Mexico's gold miners forecast lower output after bumper 2015

Tuesday, March 15, 2016

Mexico's gold miners delivered on their promise of a bumper year in 2015, with output forecast to fall this year.

The companies produced 3.87Moz last year, compared to guidance of 3.76Moz at the start of the year, based on midpoint forecasts by 19 companies collated by BNamericas.

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Output is expected to decline this year to around 3.21Moz. However, the figure excludes Goldcorp's Los Filos mine and assumes flat output by Minera Frisco and a number of smaller producers which have not issued guidance.

Privately owned companies and miners which produce small quantities of by-product gold are not included.



TOP 10

The 10 biggest gold miners were responsible for the vast bulk of output, at 3.47Moz, with combined 2016 guidance of 2.81Moz.

Goldcorp was by far the biggest gold producer at 1.13Moz, thanks to a strong year at Peñasquito, Mexico's biggest gold mine.

The company expects Peñasquito to produce 550,000oz in 2016, down from 860,300oz. Guidance has not been issued for its Los Filos operation.

Second placed Fresnillo also had a strong 2015, with gold production at 761,712oz, compared to guidance of 677,500oz. The company, majority owned by Industrias Peñoles, expects a further increase to 782,500oz in 2016, probably enough to make it Mexico's top gold producer.

Minera Frisco, at number three, produced 411,858oz gold in 2015.

Agnico Eagle produced 352,039oz last year at its three Mexican mines, compared to guidance of 315,000oz. The company expects to produce 320,000oz gold in Mexico this year.

Alamos Gold's 2015 output was lifted by its acquisition of AuRico Gold and the El Chanate operation, at 219,642oz, compared to guidance of 160,000oz. Output this year is expected at 210,000oz.

Primero Mining and Argonaut Gold have forecast slight declines in Mexican output this year to 150,000oz gold and 135,000oz gold equivalent, respectively, from 151,355oz and 139,059oz.

New Gold and Pan American Silver were the only other companies to produce over 100,000oz last year, at 105,500oz and 102,110oz.

New Gold expects output to drop to 65,000oz in 2016 at its ageing Cerro San Pedro mine, with Pan American forecasting a rise to 109,800oz at its three Mexican mines.

Timmins Gold was the tenth biggest gold producer at 93,353oz, falling to 80,000oz this year.


Yamana Gold's Mexican gold output was below expectations at 84,000oz, with 2016 guidance at 87,500oz, with Coeur Mining above guidance at 70,922oz, with guidance at 69,500oz.

McEwen Mining produced 63,366oz gold equivalent at its El Gallo mine, expected to fall to 55,000oz this year, with Endeavour Silver producing 59,990oz gold, with 2016 guidance falling to 41,500oz.

Conversely, Fortuna Silver's San José mine produced 38,526oz, with guidance up at 42,000oz because of an expansion project.

Gold Resource expects gold output to fall to 26,000oz this year from 29,644oz in 2015, with First Majestic Silver forecasting 48,690oz, up from 25,467oz last year, due to output at the recently acquired Santa Elena mine.

Great Panther Silver expects broadly steady output this year from 29,644oz in 2015. Avino Silver & Gold has not issued guidance, with production assumed as flat this year from 7,083oz in 2015.



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