John McCluskey
CEO
Alamos Gold
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View from the Top

Operational Efficiency Based on Responsible Practices

By Paloma Duran | Fri, 08/27/2021 - 16:56

Q: What key areas has the company prioritized to continue its strong gold operation in Mulatos?

A: Mining is vulnerable to the price of gold. If companies are not efficient producers, they could easily close. Furthermore, if costs are high and the price of gold falls, mines can quickly go from being profitable to loss-making. This volatility is something that we must protect ourselves from. Operational efficiency and productivity are key to having a long-term sustainable business in gold mining, which is why we are focused on controlling costs and finding ways to operate more efficiently. We have invested in increasing the scale of the operation to reduce costs. We started the mine at 6,500 tons per day, increased it to 10,000 tons per day and now we produce 20,000 tons a day.

Q: What are some innovative technologies that are helping improve operations at Mulatos?

A: Scale is key to keeping our operating costs in line but we know that technology plays a huge role in our performance. Slope stability is critical for us to maintain safe operations. We have been using radar technology for several years to monitor the stability of our slopes, which has given us the ability to identify even the smallest fault within the open pit.

Sometimes good performance is not about software, equipment or technology but mainly about people and that is our approach when we teach safety standards and methods. We have a program called the Home Safe Everyday Program, which is considered a sophisticated way of teaching techniques and methodologies to our workers.

Q: Why did the company decide to connect the Mulatos mine to a power grid?

A: It significantly reduces our carbon footprint. We have been meaning to do this for a while but there have been a number of hurdles to getting our line. It has been quite a complex permitting process. There were many issues regarding land ownership and other parties involved. But in the end, we succeeded and now we can deliver significant reductions in our environmental impact. The power grid also has an impact on costs, as we are moving away from diesel. This is a change that will allow us to be a cleaner and more responsible operating mine.

Q: How would you describe Alamos’ approach to communities?

A: Alamos has a very broad understanding and commitment to the ideal of operating in an environmentally sensitive way but also in a way that addresses pressing social issues of the host communities. When we first arrived in Mexico and visited the site, local people looked at us with great suspicion. Therefore, we knew we had to work hard to create close relationships and could not start a project without being attentive to the communities. To improve their quality of life, we had to focus on three key areas: infrastructure, health and education. We have been operating in this region for the past 15 years and we have built schools, clinics, houses and water treatment facilities, among other infrastructure. We have made significant progress and have been recognized on several occasions by CAMIMEX and human rights organizations.

Q: What are the company's environmental goals and how will the company achieve them?

A: In recent years, we have focused on reducing our carbon footprint and implementing better and more responsible management of our water. Sonora’s climate changes often; sometimes it rains a lot and sometimes it is very dry. Therefore, we have had to find ways to use and manage water effectively and avoid any contamination by making sure it does not come into contact with any of the mining facilities or any of the rocks. We have done a better job over the years and now Alamos is a great water recycler.

Additionally, Alamos continues to rehabilitate the environment. We started production in 2005 and rehabilitation in 2006. This is an ongoing environmental effort. When we finished the construction phase of Mulatos, there were areas we no longer needed to use. Soon after, we began to rehabilitate and replant those areas. We plan to continue doing this in Mexico.

Q: How do you think the change of state government will impact the company and its projects?

A: In the time that we have been operating in Mexico, there have been four different governors and they all agreed that mining is essential to the development of the state. The industry plays a very important role in the development and economy of the state, especially in those marginalized areas where other types of industries will not invest or create jobs. Mining offers many opportunities to improve infrastructure, health, communication and the communities´ quality of life.

Alamos Gold is a Canadian-based gold producer with three operational mines, two in Canada and one in Mexico. In addition, the company has development-stage projects in Canada, Mexico, Turkey and the US.

 

Paloma Duran Paloma Duran Junior Journalist and Industry Analyst