Douglas Coleman
Director General and Founder
Mexico Mining Center
View from the Top

Prioritizing Exploration for Industry Health

Mon, 10/22/2018 - 16:02

Q: What needs did you identify in the market that led to the creation of a directory for mining companies and their properties through a news portal?
A: MMC was founded from the recognition of the mining industry’s need for freely accessible, accurate and relevant information on mining developments in Mexico. We posted the online mining directory first and later added the news portal and exploration map. Today, with our daily bulletin, MMC News, mining executives stay on top of recent developments, service providers obtain leads to potential clients and everyone has quick, easy access to information specifically centered on mining in Mexico. MMC News is now received by over 35,000 subscribers and we just recently launched a mobile application that will make it even easier to stay up-to-date on mining in Mexico.
Q: What does the country’s mining industry need to make sure there is a healthy flow of large discoveries that can replenish depleting mines?
A: More investment in exploration and drilling will lead to more discoveries. Mexico has enormous mineral potential. Important discoveries are still being made right at the surface. A good example is the Alacrán silver-gold deposit near Cananea, Sonora, where high-grade silver was discovered within sight of Grupo Mexico’s world-class Buenavista copper mine. Dozens of geologists must have walked over this deposit without noticing its silver potential until the Australian exploration company, Azure Minerals, made the initial discovery of nearly 2kg/t silver in outcrop. Mexico continues to reward companies willing to invest in exploration with important discoveries. Brownfields exploration has shown remarkably positive results, expanding the reserves of mines currently in production. There are many excellent known mineral deposits in Mexico that have not yet been explored using modern techniques. Investment in exploration will undoubtedly result in major discoveries which are vital to the health of the mining industry.
Q: What trends have you identified when it comes to the types of projects that are being acquired most often in Mexico?
A: The focus has been on high-grade, epithermal vein deposits of silver and gold as well as high-grade copper and zinc deposits. Lithium is gaining importance due to increased demand for battery metals and Bacanora Lithium has been successful in exploring, developing and financing the Sonora Lithium project which is one of the largest, most economically feasible lithium projects in the world. There is also excellent potential for discovering large porphyry copper deposits in Mexico, but the bulk of the activity is from Canadian junior companies seeking high-grade deposits that can provide a quick return to investors.
Q: What would you like the next administration to prioritize in the next six years to make sure Mexico’s mining industry remains competitive?
A: Mexico has one of the best mining laws in the world and Mexico has a very positive, favorable environment for mining not to mention the enormous potential for new discoveries.
With that said, Mexico has been slipping in favorability for mining investment due to its lack of security and the rule of law and to bureaucratic delays. I believe one of the greatest improvements the next administration could make would be to reduce the bureaucratic delays in all steps of the mining concession process. Granting of titles to concessions should be processed in a matter of days; cancellations of concessions should be processed more quickly, and thousands of cancelled concessions should be liberated promptly instead of being held in limbo for years as they are today. This will open prime exploration ground and encourage more mining investment. Also, a big incentive for exploration companies would be if the government could speed up the process for income tax reimbursements. Without the income tax reimbursements, the expense for exploration companies is increased by 16 percent.