Penoles is the world's leading producer of silver and one of Mexico's largest and most diverse mining companies. Simply put, they set the standard in Mexico by which all other companies have to stand up to.
Industrias
Peñoles S.A. de C.V.
Listed on the Mexican Stock Exchange. President: Ing. Jaime Lomelin. and Group Vice President in charge of Mining is Carlos I. González. Industrias Peñoles S.a.de C.V. has been in operation in one form or another since 1887 and has grown to Mexico's second largest Mining Group with more than a dozen operating properties and smelters. (See table for details) Primary metals are Zn, Pb, Ag, Au and Cu as well as W concentrates. Also very strong in industrial minerals and chemicals. Peñoles is the world's largest producer of refined Ag and sodium sulfate. Image of Peñoles geographic diversity
Peñoles reported adjusted net profits of $US 278 million in 2Q96, down from $US411 million in 4Q95. Part of the reason for this is their stated goal to become one of the world ten largest mining companies by 2010. Accordingly, in 1996 they acquired the interest of Homestake and Cyprus-Amax in Cia. Las Torres and Fresnillo, respectively. They have undertaken to put a new mine on line every year, and so far they are on schedule. They have expanded exploration expenditures dramatically elsewhere in Latin America, especially Peru and Bolivia. Their annual exploration expenditures are are budgeted at roughly 3.5% of their net.
In 1996 Peñoles purchased CyprusAmax's remaining shares of Fresnillo. Cia. Fresnillo S.A. de C.V. is now completely absorbed into Peñoles. They retained the name on some former Fresnillo Co. mines including the flagship Fresnillo Ag Mine in central Zacatecas and the Naica Unit in Chihuahua.Major Exploration commitments:
Leon-Guanato Mineral Preserve, Guanajuato During the summer of 1998 the bidding on the Leon-Guanajuato Reserve packages was concluded. Penoles paid $1.2M subject to a 2.5% nsr for Fraccion 2/3. IMMSA got the other parcel for about twice that.
Sonora Cu exploration JV with Codelco. Have picked up over 1,000,000 ha in northern Sonora in 1999 for joint evaluation of buried Cu porphyry potential.
Forthcoming Mines in Mexico: Easily 3 or 4 coming on-line in the next few years.
Francisco I. Madero, Zacatecas (100%) production target 2000. A large new SEDEX discovery which will make a major underground Zn operation. Engineering studies and permitting are in progress. This will significantly help Penoles' Torreon Zn smelter needs when the mine comes into production.
Mezcala, Guerrero. (56/44 Newmont/Peñoles JV). Production 2001. A large Fe skarn with Au. Reserves 56.3 M tonnes containing 1.8Moz Au and 21.7 Moz Ag. Production expected in 2nd half of 2001. Recently high-grade structures have been identified and need further evaluation
Milpillas Cu Porphyry, Sonora. Penoles purchased this advanced exploration-stage asset directly from CyprusAmax early in 1999. It is hard to say exactly where this fits or how close it is to becoming a mine because mineralization starts way below what you would call "grass-roots".
Operating Mines in Mexico: 14 in production in 2000 located throughout Mexico.
Rey de Plata, Guerrero. A joint investment of Japanese mining companies Dowa Mining and Sumitomo, opened its majority-owned zinc and precious metals mine in the coastal state of Guerrero, potentially raising its average annual zinc production 12 percent. The $39 million Rey de Plata, or Silver King, mine will be Mexico's fifth-largest zinc producer at 20,000 tons annually and will also produce 51,000 kg (1.74 million ounces) of silver and 260 kg (9,170 ounces) of gold. (Mexico Analytica, 10/11/00)
La Herradura, Sonora. (56/44 Newmont/Peñoles JV). Production target 1999. A 54.4 M tonne disseminated OP HL Au mine expected to produce at 150,000 opy at costs around $180/oz. $185M capitalization costs. Production initially was expected 3Q98
La Ciénega, Durango: Underground vein deposit 190 km NW of Durango with proven and probable reserves of 4.4 M tonnes of 6.95 gram Au, 141 gram Ag, 1.28% Pb and 1.52% Zn. Total resources exceed 8 M tonnes. Estimated 13 yr mine life. Operations started in January, 1994 at 1000 tpd and continue to produce Au at a low cost (amongst lowest 10% globally) . Total investment around $75M. Needed to bring in power from 92 km away and build town, schools, clinic everything for employees.
E&MJ September, 1996
E&MJ June, 1994El Realito, SLP. Located at Rio Verde, this is an underground fluorite mine with grades of 71.16% CaF2.
La Minita, Michoacan. Located near Coalcoman, this is an open-pit Ag-Pb-Zn-barite operation grading 0.27% Pb, 3.12% Zn, 54 grams Ag and 36.12% barite.
El Monte, Hidalgo Located in the Zimapan District, this mine is operated by Fresnillo and mines ore grading 148 grams Ag, 1.31% Pb, 4.39% Zn and 0.25 Cu underground by room-and-pillar methods.
La Negra, Queretaro. Located in the Sierra Gorda Range in central Queretaro, this polymetallic mine was shut down in 1991 until Feb, 1996. It was expected to produce 39 tons of Ag, 3,000 tons of Pb, 683 tons of Cu and 3,300 tons of Zn in 1996.
NMN 10/24/94
Skillings 10/26/91Bismark Zn Mine, Chihuahua. Located in the NW end of the state of Chihuahua near Ascencion. Around 75th hole around perimeter of intrusion drilled center of strong ground mag anomaly drilled into a blind Zn contact skarn deposit with initial proven and probable reserves in excess of 8.6 M tonnes at almost 8.5% Zn. Developed by a ramp to take advantage of trackless underground LHD cut-and-fill mining using fleet of 8 scoop trams. Mine has 5 levels, the deepest around 420m beneath the surface. It always had made a lot of water and needs to pump in excess of 13,000 gpm. Was a 60/40 JV with Cyprus Minerals operated by the majority partner Peñoles until Cyprus was bought out around 1993.In 1997 the mine and mill employed 410 people. Developed to mine and mill around 660,000 tons of ore annually, in 1996 Bismark produced 95,500 tons of Zn concentrate, 4,200 tons of Pb concentrate and 4,800 tons of Cu concentrate. (Geomimet #209 3Q97)
Fresnillo, Zacatecas. It began with the Spanish Conquistadores and over its long life it has produced over 1 billion ounces of Ag. The main operative unit of the company is called Minera Proaño.
Geomimet #209 Sep/Oct, 1997
E&MJ October, 1994The main veins of the Fresnillo Ag Mine are:
Santo Niño: Currently the most important because of the high Ag grades and greatest strike length in the district. it strikes N&%E and dips 60-65S. Widths vary between 0.5 qnd 6 m. with an average of 2.85 m.
San Ricardo: Embedded in a fault breccia with an attitude of N75W dipping towards the NE and averaging 2.80 m wide.
Santa Cruz: On the southern end of the district with an attitude of N78W dipping 65 to the NW with average widths of 5.0 m. Mining on this vein started in March, 1990 at a depth of 270 m.
San Mateo: This vein was initially intersected in July, 1989 at 600 m above the hanging wall of the eastern end of the Santo Niño vein. Surface drilling expanded its reserves later.. Its attitude is S80E dipping 75 S and averages 1.78 m in width.
The main minerals of the above veins are pyrargarite, polybasite and argentite. production from these veins combine to feed the mill at a rate of 3000 tpd at an average headgrade of around 755 gpt Ag (a little more than 24 opt!!) making it the world's most profitable Ag Mine. WOW!!!
Naica, Chihuahua. Fresnillo - Unidad Naica. A major carbonate-hosted Pb-Zn replacement deposit developed as an underground mine and mill complex operating at about 3000 tpd. It is Peñoles' main producer of Pb and second of Zn. Was a relatively new "blind" discovery. In 1997 the Fresnillo's Naica Unit was deepening the shaft from the 700 to the 765 level along with the infrastructure improvements needed to pump 11,000 gpm of water, crush and hoist ore. Naica employed about 569 people in 1997. During 1996 its production was as follows:
54,892 tons of Pb concentrate at: 1.0) gpt Au, 2100 gpt Ag, 68.86% Pb, 2.77% Zn and 2.91% Cu
47,862 tons of Zn concentrate at: 0.22 gpt Au, 69 gpt Ag, 1.13% Pb, 53.21% Zn and 1.25% Cu
204 tons of tungsten concentrate with grades of 70.38% (Geomimet #209 3Q97)Sabinas Mine , Zacatecas. A skarn hosted proximal Pb-Zn- mine located in the San Martin District. Put into production in the 1940's, this 2000 tpd underground mine produces ore grading around 4% Zn, 1% Cu, 120 gpt Ag and 0.5% Pb. Minor by-product Au, Cd and W.
Las Torres Complex - Guanajuato. Underground Ag-Ag veins of well-known camp which includes the Veta Madre..
La Encantata Mine, Coahuila. A Pb-Ag CRD replacement chimney in Cretaceous carbonates. Was once a partial asset of Homestake Mining Company.
Laguna del Rey, Coahuila
