Strong Leadership Drives Sustainable Results: Guanajuato Silver

Q: What is Guanajuato Silver’s vision for Mexico?
A: Guanajuato Silver’s vision is to be a safe and reliable medium-sized producer of precious metals and an innovative, financially solid, and respected company that focuses on sustainable mining in central and northern Mexico. We also want to be an exceptional employer. We are different because, out of all foreign mining companies operating in Mexico, we are the most “Mexican.” The entire management team is Mexican. We are harnessing local talent to form the new Guanajuato Silver team that will achieve our business vision.

Guanajuato Silver's initial growth was rapid. We concluded a number of acquisitions and are now making those assets productive. We saw record production in 1Q24. If there are opportunities, we will act quickly to take advantage of them.

Q: As the new COO of Guanajuato Silver, what experience do you bring to the company and what are your goals in this position? 
A: To be productive, the first priority should be human talent. We modified our equipment and plants, but the most important change was leadership. I passed on our business vision, our leadership style, and our goals to everyone at Guanajuato Silver. We analyzed opportunities in the mines, plants, and equipment, and achieved significant efficiencies. We promoted talent development in areas such as ventilation engineering and geotechnics, with a different focus and leadership style.

Our goals are to exceed 1Moz in 2Q24 and resume stalled projects, including installing flash cells to recover minerals in addition to what is recovered by normal flotation cells. This increases the value of our concentrates and our income. These changes, along with our new image, will attract suppliers and traders, consolidating us as a reliable and attractive producer for the market.

Q: What advances have been made toward restoring operations in past-producing silver mines?
A: We are restarting exploration at Topia and at our older mines like Valenciana and Cata. Despite their age, recent drilling programs are yielding promising results, with vein analysis underway. San Ignacio's drills are also showing positive signs. Despite the common belief that these are old and extinguished mines, our drill findings show great potential. 

Following a recent visit to Topia, we are confident that we can double production in 2024 with minimal investment. To achieve this, we are focusing on ensuring that the plant can efficiently process high-grade ore, which is abundant in Topia. We are expanding our filter capacity and optimizing cell operations to capitalize on this opportunity. We are also revamping our strategic planning processes to be more agile in addressing challenges and improving efficiency. Our emphasis on leadership and teamwork is key to our success, as we strongly believe that effective leadership drives positive change. Financial investments are crucial, and we are now leveraging past investments to enhance productivity and achieve our goals, always with a strong team and strong leadership.

Q: How has the Pinguico project advanced and what potential does it have? 
A: The Pinguico mine is of significant size and historical importance. During the Mexican Revolution, Pinguico was one of the region's most important gold mines. We believe that there is still significant untapped potential in the mine, and we are excited to see what we can uncover. Despite its potential, it had been somewhat neglected until recently. Since January 2024, we have been moving swiftly to capitalize on its resources. In May, production from the above-ground stockpile is ongoing, which are remnants of high-grade ore left behind by earlier miners who lacked the technology to extract them efficiently. With our modern equipment and technology, we can profitably process this ore.

The decision to focus on Pinguico was driven by its proximity to El Cubo’s processing plant, which has great capacity for ore processing. This allows us to process the ore without the need for significant additional infrastructure. we are now planning to further explore its potential. 

Guanajuato Silver prioritizes economically viable projects. Pinguico is a prime example of how we are leveraging our existing assets to drive growth and profitability.

Q: What is Guanajuato Silver’s approach to ESG? 
A: In my previous role at Santacruz Silver, we achieved something unparalleled in Mexico: securing the IRMA certification for responsible mining, an unmatched feat. I am bringing that vision to Guanajuato Silver. 

To sway opinions about the mining industry, we work to consistently exceed expectations. We are making headlines every day in Guanajuato. The goal is to drive productivity, nurture our relationships with communities, address environmental concerns, and adopt a proactive stance. This proactive approach will soon be reflected in our strategic plan. Our objectives are clear: prevention, productivity, and growth. Prevention is not just about avoiding accidents but preventing negative narratives and financial setbacks.

We are focusing on making Pinguico more efficient and effective. We want more production and for our team to grow and their families to prosper. These objectives are part of a larger plan for the next five years. We will talk with the incoming municipal president and governor to help them understand what Guanajuato Silver stands for in terms of responsible mining. 

Q: When will Guanajuato Silver obtain the IRMA certification? 
A: We are meticulously assessing acquiring the IRMA certification. It is not complicated, but it requires careful planning. We need to understand Guanajuato Silver better to determine our potential rating, as this is an extremely robust certification. I plan to propose acquiring the certification but the timing has not been decided yet.

Q: What are Guanajuato Silver’s perspectives on the future of the mining sector? How does the company plan to navigate upcoming challenges?
A: During times of political change and economic uncertainty, crises can unexpectedly create opportunities. Guanajuato Silver sees challenging periods as potential openings for growth. While we never wish for companies to leave Mexico, their departure can create space for remaining entities to acquire their assets. With the right approach and execution, this can lead to increased productivity and growth for those who remain.

Politically, we will aim to align with governments to ensure responsible mining, community integration, and protection of local employment and the local economy. Our goal for 2024 is to reach close to 4Moz AgEq, a significant increase from last year's 3.5Moz. We are prepared to pursue growth opportunities and secure investments to achieve this target. Our focus remains steadfast: responsible and sustainable growth in the mining sector.
 

Guanajuato Silver is a Canada-based precious metals producer engaged in reactivating past-producing mines in central Mexico. In Guanajuato, it operates the El Cubo Mines complex, the Valenciana Mines complex, and the San Ignacio mine, as well as the Topia mine in Durango.