Alain Charest
Exploration Vice President, Mexico
Evrim Resources
View from the Top

"Outraregous" Number of Mineral Properties Remain Unavailable

Wed, 10/18/2017 - 14:54

Q: How does Mexico stand out from other mining countries?

A: Mexico is an amazing country and differs greatly from other mining jurisdictions thanks to its long mining tradition dating back to the 1500s. Other countries such as neighboring Guatemala have similar geological potential but no long-standing mining tradition, which makes it much more difficult to carry out mineral exploration and mining.

Evrim Resources spends more than 60 percent of its resources in Mexico. We have four active projects located in Sonora and Chihuahua. On the project-generation side, Evrim focuses its exploration activities in northwestern Mexico, mainly in the Sierra Madre Occidental’s volcanic belt where many high-potential mineral prospects can be found, explored and developed. The company is based on the project-generator model, which involves the participation of a team of highly experienced exploration geologists in both Canada and Mexico.

Q: What would you consider to be the main challenges that exploration companies face in Mexico?

A: My biggest concern in doing exploration work is related to the availability of mining concessions. Today, there are thousands of canceled mineral concessions that have accumulated over the past 25 years or so, an outrageous amount of mineral property that has not been made available for acquisition by the public. These mineral concessions are tangled in a faulty, deficient bureaucratic process and remain dormant until the respective authorities free them and offer them to the public.

Another impediment to exploration work is that a considerable portion of prospective mineral concessions are owned and controlled by large companies, many of which remain stagnant exploration-wise for many years. These major mining companies would benefit if they  would be more open to working in partnership with the smaller exploration companies. Sadly, we often find out that half or more of our selected target area is covered by canceled “untouchable” claims. Once the canceled mineral concessions are freed and released for public tendering it is still difficult for a junior mining company. The tendered mineral claims are granted through a lottery system where the more tickets bought, the better the chance of a win, giving a solid edge to the cash-rich, larger companies.

Q: What strategies help ensure success and potential discoveries?

A: On the exploration side, it helps to have a broad network of contacts in the industry, including government officials, concession owners, surveyors and local prospectors from mine communities. Once a promising target has been selected and the legal status of the mineral concessions has been cleared, Evrim will conduct a field evaluation program including rock sampling and mapping. If the results are positive, Evrim then starts a process of negotiation with the claim owners to reach reasonable terms on a contract that includes the permission to explore the mineral concessions and an option to buy the respective mineral rights.

In late 2015, Evrim acquired the Cerro Cascaron project near Morelos in Chihuahua through such a process. As of today, the company has spent more than US$250,000 evaluating the project. Cerro Cascaron is now at a stage where it can be offered as a JV to larger mining companies that are looking for potential new mineral projects to develop.

Q: How can the Mexican mining industry boost its production levels?

A: Mexico should try to learn from the largest producer of gold in the world today, China, which has only a few million-ounce-plus gold deposits; most of the country’s producing gold mines have only 200,000–300,000 ounces of reserves. Mexico has many million-ounce gold mines in production, and many more 200,000-300,000-ounce gold deposits that are not being exploited. Mexico could become the global leader in gold production if it can find a way to take advantage of this abundance of smaller gold deposits.