Image credits: Shane McLendon
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News Article

Torex Gold to Invest Significantly in Guerrero

By Fernando Mares | Fri, 05/06/2022 - 13:40

Minera Media Luna, a subsidiary of Torex Gold, will invest considerably with the aim of integrating its Limon Guajes and Media Luna projects and extending the gold project’s useful life until 2033. 

 

Faysal Rodríguez, Vice President Mexico, Torex Gold, announced an investment of over US$800 million, which will be invested from May 2022 until 4Q24. The company’s estimated production would be from 430,000oz to 470,000oz of gold a year. Through the launching of the Media Luna Project, the company’s operations can continue until at least 2033. According to Rodríguez, this is the single largest investment from a mining company in the state of Guerrero, if not in all of Mexico: “So far, I am not aware about an investment like this in the country. Other projects are under development, but not with a formally announced investment like ours. it is an investment without precedent in Guerrero,” said Rodríguez during a business forum.

 

The company already announced works, which will start in 1H23 become operational in 4Q24. 

The works consist of the construction of an underground tunnel under the Balsas River, where a conveyor belt will be installed. The company will also build ventilation, a water treatment plant, pumping infrastructure and a paste filling plant, among other infrastructure.  

 

The company is furthermore aggressively investing in exploration. In 2022, the company already committed to invest over US$35 million in exploration activities within its 29,000h of concessioned land. 

 

Despite the changes and uncertainty created by the Mining Law reform and a lack of new concessions, the company said that its confidence in Mexico is still strong. “We have built a great relationship with [Guerrero] Governor Evelyn Salgado. We must say that we have received strong support from the federal government. This built trust among our managing board to approve this investment,” Rodríguez added. 

 

The company announced that from the US$800 million investment, US$500 million will be sourced from the company’s own resources. For the remaining US$300 million, it will seek financing elsewhere. Currently, the company has 1,000 employees. This investment aims to create other 600 direct jobs. Rodríguez highlighted that inflation, which earlier this year already reached 7 percent, is one of the biggest challenges for the company and it will be reflected in operation costs. 

 

According to the Ministry of Economy 2021, Mexico received over US$4 billion of FDI in the mining sector, with most of the investment coming from Canada, the US and Spain. 

The data used in this article was sourced from:  
El Economista, Forbes
Photo by:   Shane McLendon
Fernando Mares Fernando Mares Junior Journalist and Industry Analyst