Enrique Espinosa
Deputy Director of Mineral Resources
Mexican Geological Survey
View from the Top

Geology: The Beginning of Mining

By Andrea Villar | Tue, 05/05/2020 - 08:44

Q: What role does the Mexican Geological Survey (SGM) play in the mining industry?

A: The Mexican Geological Survey plays an important role in the mining industry as it is the government instance aimed to generate geological, geochemical and geophysical information and makes it available to everyone.

We offer geological information on two scales: 1:50 000 and 1:250 000. Currently, the 1:50 000-scale mapping is in process, which are detailed maps that contain geological information and mineral deposits distribution within the limits of the map. Cartography includes two disciplines: the first is geochemistry, which means taking stream sediment samples, analyzing them and mapping out the origin of statistically anomalous elements found in the sample. The second is geophysics, delivering airborne and ground data to determine the response of possible buried mineral deposits. To do this, we measure the magnetic susceptibility of the exposed and underground rocks to identify areas on which the magnetic response is compatible with the presence of a suspected mineral deposit. Another method is called electromagnetic transient or TEM, which consists of a coil suspended in a helicopter “injecting” an electromagnetic field into the subsoil to reveal its characteristics based on the transient response of rocks lying up to 400 meters deep.

Another airborne system is the high-resolution geophysics, a technique englobing two methods: the air-magnetic search plus the radiometric. Radiometry records radioactive components on the surface rocks such as uranium, thorium and potassium. This method is highly practical and recommended for mining exploration because helicopters fly about 60 or 70 meters above the surface, allowing for a better magnetic response of the rocks plus the radioactive content of the surface rocks.

Q: How does the recognition of an area of ​​mining interest begin?

A: The SGM makes the evaluation of new mineral deposits. When a geological map is searched, the geologist in charge has the commitment to record the different types of rocks and its relationships. They also point out evidences of areas that could be of interest to explore for a mineral deposit. For example, a hill with crests or anomalous coloration may indicate an anomaly and, therefore, a prospective area. Also, lineaments or visible hydrothermal alteration in certain points, as well as dense content of veins and veinlets.

Samples from these prospective areas are analyzed and a follow-up visit is scheduled to take more samples and evidences. If that area still has the necessary qualities, it is registered as an exploration target and additional fieldwork is done. If that exploration target ends up being an interesting area, it finally becomes a mining allotment.

Q: How does mining benefit from the SGM taking over the mine instead of the private sector?

A: It benefits as the Geological Survey has enough experience and the number of professionals needed to take the first evaluation risk and make savings to the mining companies searching for mineral projects.

Once the land becomes a mining allotment, it is legally protected, so it can be evaluated. Evaluation includes a detailed exploration of the area to propose a deposit model according to the geological context, origin, mineral content, shape and other factors.

The law allows SGM to search over the area for a maximum of six years to assess whether there is a mineral deposit at depth. During the evaluation, if it is determined that there may be a profitable mineral deposit, a drilling campaign is performed for confirmation on the potential resources. After the drilling, the area is put is concessioned through a bid carried out by the General Directorate of Mines.

The winning mining company already knows that there is a high probability of an important mining project in a specific site because SGM geologists deliver reliable information. Once the project becomes a mining operation, the company pays from 1 to 3 percent royalty to the SGM for the entire duration of the operation. The royalties are known as a finder’s fee.

The Undersecretary of Mining, Francisco Quiroga so the General Director of the Mexican Geological Survey, Flor de Maria Harp, continue encouraging the aforementioned policy in order to increase the confidence and value of the prospects proposed for bidding.

In 2000, a new discipline called environmental geology emerged. This branch is dedicated to help state and municipal governments to identify geological hazards in certain areas exposed to floods, landslides, earthquakes, volcano eruptions and snowfall, among other natural phenomena.

Q: How does the Mexican Geological Survey support smaller companies in the mining sector?

A: Many people have a mining concession but do not know what its potential might be. We can evaluate the concession using three modalities: 1) geological assessment, 2) a service contract to do a specific job, such as reserve estimates, and finally, 3) a reserves or resources certification. In the latter, the SGM issues a certificate that backs up the amount of resources within a deposit. This document helps concession owners to finance the project with the Fideicomiso de Fomento Minero (FIFOMI) or another bank.

Q: What new projects does the Mexican Geological Service have in the pipeline?

A: It is a matter of importance to reinforce and continue exploration of uranium, rare earths and lithium. The last, a critical element used in modern digital and communications technologies. Four projects are being assessed, two in the state of Sonora, one in Jalisco and one in Puebla. Actually, they are in the first exploration stage.

SGM Continues improving has a division that is dedicated to digital geoscience where all the published information in the database GeoInfoMex is managed to make easy access and consulting. GeoInfoMex is a digital platform providing information on geophysics, geochemistry, mineral deposits, earthquakes, land tenure, mining property and geological risks, among others.

Q: What is SGM’s position on the proposal regarding the indigenous consultations?

A: Not much has been defined yet regarding this matter; nonetheless, we understand that the indigenous communities of Mexico are the true heirs of a historical tradition that has existed for more than 500 years. Countries like Canada, Australia and Africa value it as a cultural heritage and make sure these values are not lost. Mexico is already taking action and it would be worthwhile to reconcile the views of the communities and a mining company that is going to be installed on-site.

The Mexican Geological Service is here to serve Mexicans. It has been said that mining is the source of everything because raw materials are used to build buildings, cars and even computers. That is true; however, if mining is the beginning of everything, geology is the beginning of mining.

The Mexican Geological Survey (SGM) is an institution within the Ministry of Economy committed to generate geological knowledge of Mexico by contributing to investment and competitiveness through the sustainable use of natural resources.

Andrea Villar Andrea Villar Journalist and Industry Analyst