Los Filos Mining Complex Grapples With Gold Production Deficit
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Los Filos Mining Complex Grapples With Gold Production Deficit

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Fernando Mares By Fernando Mares | Journalist & Industry Analyst - Wed, 08/03/2022 - 15:51

The Los Filos Mining Complex, property of the Canada-based Equinox Gold, reported significant decreases in its gold production. The company says the deficit is mainly associated with the COVID-19 pandemic as well as its outdated equipment. Nevertheless, Equinox remains optimistic about the future of the complex, whose operations could be expanded for another 16 years.

According to Ezequiel Martínez, the person overseeing the work of the Los Filos Mine for Equinox Gold, the company reports a 10,000oz gold production deficit, caused by forced absences of key staff. He mentioned that mechanical failures and COVID-19 cases were the main reasons for this issue: over 500 workers tested positive this year and 12 operators are currently in isolation. 

Carlos García, Director General, Los Filos said that the estimated production for 2022 is 160,000oz of gold, which is lower than the registered production of 2011, 2012 and 2013, when the mine produced over 400,000oz/y. “As with every deposit, there are bell curves and time continues to pass. Now, we work with outdated equipment, lower grades, distances from the deposits are now longer, the price is another factor that either plays in favor or against us. We were selling at US$1,850/oz and now we are selling at US$1,600/oz,” García added. 

According to Gacía, the mining complex requires investment to maintain continuous production and continue bringing economic value to Carrizalillo’s inhabitants, who benefit from leasing their land to the company. Currently, Equinox operates in 500 of the more than 2,600ha that inhabitants leased to it. “The fee that the Los Filos Complex pays for each hectare is the largest of all Latin America. I do not want to reveal the numbers considering the inhabitants’ safety, but the agreement will last until 2025,” García added. 

Regarding its environmental impact, the company pointed out that from 2014 to date, it has restored 121ha of land via an investment of US$5 million. This was used to construct dams and trenches, as well as to carry out reforestation works. The company says that the land could be used for agriculture within the next decade. 

The company said it created over 1,644 jobs, of which 669 were for nearby inhabitants who work as chauffeurs, mine employees and general workers. Furthermore, the company highlighted that it employs 164 women. 

García said that the company has been cautious regarding security issues, since the central area of Guerrero suffers from insecurity caused by organized crime. Nevertheless, Equinox said it has not suffered from extorsion or theft yet. “Because of corporate regulations, as a company listed in the stock exchange, as well as our ethics and conduct codes, we cannot deal with groups that operate illegally such as terrorists or gun traffickers,” García added.

Photo by:   Stafi Chuck

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