At Least 50 Mexican Metals Ops Ripe for Takeover
Source: Reuters, Mica Rosenberg (2/22/11)
"Expansion plans and new projects set to boost production, investment."
Sergio Almazan, the head of the chamber, said investment will jump 7.3% in 2011 compared to last year, the boost driven in part by expansion plans at the giant Cananea copper mine.
Cananea, Mexico's largest copper mine near the border with Arizona, reopened last year after a three-year-long strike and is slowly ramping up production.
Mexico's copper production is seen rising to 31% this year to 350,000 tons, Almazan said, slightly below forecasts made by the chamber made last September.
"In copper we hope to return to the levels (of production) we had in 2007," before the strike began at the mine, Almazan said.
The ground is fertile for acquisitions, said Eduardo Luna, the director of precious metals miner Primero Mining Corp. (TSX:P), with 738 exploration projects in Mexico.
"There are around 50 projects that are being studied by different companies that have the possibility to be developed beyond the capacity of their actual owners. Definitely there will be mergers and acquisitions," Luna said at a chamber event in Mexico City, without naming specific companies.
The most advanced exploration projects in Mexico are already owned by the major mining companies, including Grupo Mexico, Goldcorp Inc. (TSX:G; NYSE:GG) and Fresnillo, the precious metals arm of Penoles, Almazan said.
With new projects coming on stream, Mexico's silver production will jump to 138 million ounces in 2011, up from 128.6 million ounces in 2010.
Gold production is also expected to rise 12.5% this year to around 2.7 million ounces.