Canadian Company Vows to Overcome Drilling Woes,Wed, 10/21/2015 - 16:16
The domination of Canadian companies in the Mexican mining landscape can be attributed to many factors: the country’s mining supremacy, its relative proximity to Mexico, the experience of its companies in a number of environments, and the financial bearing of the Canadian mining industry. While all of these have contributed, not all Canadian executives agree on why their country has attained its leadership role in Mexico. Robert Daigle, Director of G4 Drilling Mexico, believes that Canadian mining firms have outpaced their competitors in a number of ways. “The exploration market is highly competitive,” states Daigle. “To stay ahead of the game, G4 Drilling has had to develop the ability to provide tailored services to its clients and harness leading safety systems to reinforce what we offer. Although most of our work is carried out in Canada, we have offices in Colombia, Mexico, and Panama as well. Mexico was actually our main source of revenue for several years,” explains Daigle. His argument is a compelling one. Although G4 Drilling has certainly capitalized on its country of origin’s reputation, this is hardly enough to remain a market leader. Being a Canadian mining company does not confer special protection from adverse conditions.
G4 Drilling also seeks to dismiss another matter, namely that much diversification exists within the exploration sector. “All companies use similar equipment and similar techniques for drilling. Such companies do not traditionally have the luxury of choosing the location of their projects. We have to play to our strengths to be flexible in a range of conditions,” says Daigle. One of those strengths is the experience and skill of Canadian mining executives. When Daigle first moved to Mexico for G4 Drilling in 2008, many Canadians went with him to set up operations here. However, the company made it an early priority to train up a fully Mexican team. In 2014, only two Canadian supervisors were left in the country. Another area that G4 Drilling seeks to focus on is providing a lower price per meter drilled than the competition. Unfortunately, achieving this came at a serious cost as the company has had to lower the wages of its employees, with Daigle finding no comfort in the fact that competitors have done so as well.
In order to hold onto its market share and be primed to expand it once growth returns, G4 Drilling has sought to make its basics above all reproach. In a time where mining companies are closely scrutinized for any environmental fault, G4 Drilling goes beyond the call of duty to minimize the impact of its operations. Daigle says that the company only uses biodegradable additive processes, ensures that all working areas are kept clean, and that all waste is disposed of on the spot. Furthermore, it has come up with a strict oversight process for its drilling rigs, whereby preventive maintenance is constantly performed and detailed in logs to avoid all emissions of pollutants or leaks of oil or fuel. Besides this, Daigle strongly believes in the fact that reducing costs does not mean withdrawing from the public eye. G4 Drilling has made a strong push to stay present in the minds of mining players by participating in national and international conventions.
Although he acknowledges that business slowed down from 2013 to 2014, Daigle is determined to see beyond this adversity and he maintains a positive outlook on the seven years since G4 Drilling entered Mexico. Over that time, G4 Drilling has been hired for exploration work at such heavyweight projects as Coeur Mining’s Palmarejo mine and Agnico Eagle’s Pinos Altos mine in Chihuahua. Overall, this has led it to drill a yearly average of 350km. However, replicating this success in the future will require exploring new paths. “We expect to see many changes in this sector over the next few years. There will be an increased focus on the environment and on safety,” says Daigle. “But, at the moment, a large majority of the drilling rigs in Mexico are not being used since there is simply not enough work coming in. We hope that by the beginning of 2015, the market conditions for exploration will improve. We are ready for the moment when business picks up again, both in terms of staff and equipment.” This confidence is based on a foundation that again shows how Canada can impact the Mexican mining market. Daigle explains that northern Canada has seen an increasing interest from Chinese players looking for iron ore. Mexico’s reserves provide him with assurance that this trend will soon spread here, which, along with activity surrounding gold mines, could lift drilling out of the doldrums.