San Rafael Mine To Reopen After 17 Months of Blockade

After months of negotiation, Americas Gold and Silver reached an agreement with Mexico´s Ministries  of Economy, Interior and Labor in an effort to reopen its Cosalá Operations, which had been closed for the past 17 months. The company announced that with the start of operations and high metal prices, it will be able to achieve a silver production of 2.5Moz per year.

The new agreement comes after months of negotiations and roundtables with governmental entities , where all parties shared their concerns and objectives. The negotiations had the participation of key leaders of the Mexican government, including President López Obrador, ministers, union representatives and workers, representatives of the community of Cosalá and organizers who supported the reopening of operations. Reaching a solution with the most important stakeholders has ensured the long-term stability of the company's operations, Americas said.

During the illegal blockade, Americas was unable to access the mine. However, with the new agreement, the company will have an immediate right to possession of the property. Before resuming operations, the Ministry of Labour will carry out a joint inspection on July 8 to verify whether the company can restart operations safely and sustainably. Americas added that after the inspection, it will provide an update and schedule to resume operations at the mine and mill.

Once operations resume, Americas will target higher grade silver minerals in the Upper Zone at San Rafael and develop its EC120 project. The new program at Cosalá Operations is expected to increase its silver production to more than 2.5Moz per year, following the lifting of the illegal blockade. Americas added its operations will benefit from the current high prices of silver, zinc and lead.

The Ministry of Economy said the new agreement has complied with the instructions of President López Obrador to reach a favorable solution for the reopening of the mine, while respecting workers' labor rights. In addition, the Ministry added that Mexico is a country with favorable conditions for investment and labour, which will be further promoted to attract more foreign investment.

Cosalá Operations comprises 67 mining concessions covering approximately 19,385ha in Sinaloa. It includes the San Rafael mine, where the company produces silver, zinc and lead. Since Jan. 26 2020, the company’s operations have been illegally blocked by its union members, under the argument that the company needed to improve working conditions. However, on several occasions, Americas explained that these claims were based on false accusations and that the real objective of the group was to illegally obtain a collective agreement and other contracts related to mining activities.