Top 20 #Copper Mines

To make the list, the cut-off for 2022 was 245kt, versus 232kt in 2021 and 221kt in 2020. The order of the mines also changed, with mention going to Codelco’s Chuquicamata which saw production fall from 319kt in 2021 to 268kt in 2022, but it was not the only one with declining output.

#Mexico #Covid19 Lockdown puts #Gold & #Silver Miners' 2020 Plans on Hold

Just as Miners were gearing up for increased production, Mexico lockdown upsets miners' 2020 plans

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On March 31, the Mexican federal government mandated that all non-essential businesses temporarily suspend operations until April 30 due to help curb the spread of the COVID-19 virus.

WPM said all of its counterparties were taking steps at the corporate and operational levels to ensure business continuity, but given the fluidity of the situation, the risk that these operations would be impacted in some way had become too great to continue to rely on the February-issued production guidance.

Newmont Corporation reports that as of April 1, mining has not been deemed an essential activity under the Mexican decree, but that it is engaging with government to better understand the intended impacts of the decree on its operations. As a result, Newmont is undertaking an orderly ramp-down of operations at the Peñasquito mine. Other significant Mexico-based mines on which WPM has streaming deals include the San Dimas and Los Filos mines.

WPM said it was currently generating enough free cash and maintained comfortable debt levels to fund all outstanding commitments, including dividends, as well as providing flexibility to pursue new metal streams.

Fellow Canadian company Agnico Eagle Mines also said Thursday it was ramping down its Mexico operations, including Pinos Altos, Creston Mascota and La India, which would remain suspended until the end of this month. Agnico's Kittila mine, in Finland, is expected to continue operating at normal levels, however, it reported one positive case of COVID-19 in an underground miner which caused several days' disruption last month.

Mexico's highest-grade silver miner Excellon Resources will also suspend all mining, milling and exploration activities at its assets, including the bonanza-grade Platosa silver mine. Critical pumping, safety, security and environmental management will continue during the temporary hiatus.

Meanwhile, Endeavour Silver said it was in the process of suspending operations at all three its Mexico mines, thereby also pulling its 2020 production and cost guidance. For 2020, the company had targeted production of 3-3.5Moz silver and 38,000-44,000oz gold at an all-in sustaining cost, net of gold by-product credits, of US$17-$18/oz silver.

Equinox Gold, which just this week announced it expected to triple output to 700,000oz in 2020, said Thursday it was suspending all mining activity at the Los Filos mine. It will continue to process solution from the heap leach pads and expects output to continue at reduced levels through the temporary suspension.

The company has also temporarily suspended operations at its Pilar mine, in Brazil. Equinox's other producing mines continue to operate normally with COVID-19 safety and preventive measures in place.

It said it was too early to determine the impact on the production guidance and it would provide updates when practical.

MAG #Silver ($MAG.to) CAD 9.00 - Comments from Raymond James

MAG Silver is one of the best silver stocks to play as its main asset, the Juanicipio silver project (44%) (Fresnillo 56%) is under construction and the Cinco de Mayo (100%) silver-zinc-lead project has huge exploration potential.

Both projects are in Mexico.

THIS IS FROM RAYMOND JAMES RESEARCH:

Although we do not officially cover Fresnillo, I don't think many people dispute the high quality silver miner that they are.  The company is known for its lowest cost silver assets, high return projects, strong track record of project delivery and history of district consolidation.

Fresnillo's next best asset - Juanicipio, is the world's highest grading project that continues to grow at depth and has high potential for new vein discoveries on the property and at depth under the main vein (drilling has been incredibly encouraging).  As you can see by the picture, this is in a main district Fres operates in.

Fresnillo, is JV'd with MAG Silver on this project and development has already started with significant progress of an impeccable ramp you could drive a Ferrari down.  Our analyst recently visited the site and believes the ramp up risks have been lowered and the mine is being constructed to a level typical of much larger mines – foresees them meeting the late 2017 start date.

MAG is trading at ~0.59x total company NAV, but if you believe their two other assets are getting no value then it is trading at closer to just over 1xNAV for Juanicipio but gives you upside in exploration (bumped target once recently)/ takeout premium / development and then strong FCF profile.

Their second project currently hosts 12mmt of Zinc grading 13%... we think there is incredibly strong potential to triple this…overhang- surface access temporarily blocked-  a resolution with the Ejido group this year would likely result in a nice bump to the stock price.

We strongly urge investors to take advantage of recent share price weakness in MAG; cheap Tier 1 assets don't stick around – they either appreciate in value or get taken-out.

It has paid to trade around core positions in this stock…development is on track, new zones are being added, potential for access rights to be received at second project, people adding to precious exposure, takeout potential is real…

·         MAG is unequivocally the best silver developer in the world with:

o   the highest grade project globally that continues to grow at depth and has high potential for new vein discoveries

o   low risk profile, with development quarterbacked by the world's most experienced silver operator and its location in a safe part of Mexico

o   hopeful 2015 return to 100%-owned Cinco de Mayo, which has massive potential and is zinc-dominant, yet is overlooked by the market

o   strong balance sheet with some ~$80 mln in cash – well over half their upfront capex requirements at Juanicipio

o   high caliber, albeit small, management team with low G&A

o   and yet the stock is trading at only 0.5x P/NAV,

§  we currently value this asset using a DCF valuation for MAG's 44% at C$8.84/share

·         recent exploration results increased tonnage and LOM, our NAV increased by $1.00

Exploration points to further upside at Jaunicipio

o   Upside through an entirely new silver rich phase of mineralization overprinting the roots of the main vein, Valdecanas, opening up additional high-grade potential at depth.

o   4 holes were recently drilling into this area that on their own have doubled the existing Deep Zone resource of 4.5mmt and have significantly increased the average grade

o   Increases ounces per vertical and development meter, increasing mine effenciency and lowering future unit costs

o   Extends mine life by an additional 4 yrs and boosted our NAV by $1

• The higher deep tonnes also underlines emerging potential to raise a shaft later in the mine life to support higher throughputs and production rates

o   Potential to build on results such as this..

Other assets not getting much value by the market:

Superb Exploration Upside at Cinco de Mayo – A Potential Second Tier 1 Zinc Asset

·        Cinco is MAG's second project, 100%-owned and also in Mexico, but where MAG has had its surface access to the site temporarily blocked  

·        Cinco already hosts 12 Mt grading 13% ZnEq (for about ~3.6 Blbs Zn) but we believe there is potential to triple that resource and develop a world-class, bulk-tonnage CRD mining operation providing MAG with a second, Tier 1 producing asset after Juanicipio.

·        The project is also zinc-dominant (~50% by value) – a metal with a very compelling-term supply/demand outlook.

·        The legal process to return MAG's access is moving along (government will overturn illegal Ejido meeting and set-up a new meeting), negotiations are ongoing, and management remains confident they will secure surface access during this calendar year, which in our view should lead to a significant bump in the stock given the huge CRD potential of the project.

MAG is earning-in at Salamandra

o   a potential Cinco lookalike where MAG just expanded the on-going $1Mio, 3000 m program - MAG's CRD expert Peter Megaw is very excited it

o   And the Pozo Seco moly-gold zone on the Cinco property is likely to be monetized in the coming few years – hard to say what they would get, but it has $2.2 bln dollars of in-situ moly and gold near surface

Link to the Full Research Document
MAG Silver MAG-TSX MVG-NYSE MKT
Strong Deep Drill Results Unlock Long-term Juanicipio Potential

Link to the Full Research Document
MAG Silver MAG-TSX MVG-NYSE MKT
Juanicipio Site Visit - Ramp Development Accelerating

Long run silver price, US$/oz

US$17.50/oz

#Mexico will see significant growth from the coming huge private investment in #energy #MasterEnergy

Total private investment in energy may reach $161bn between 2014 and 2020.

Mexico counting on huge private investment in energy

Beyondbrics - FT.com

Mexico’s energy reform is all about boosting investment and thus production. But the million dollar question is: just how much investment will flood in, and to what type of resource, when fields are put on the block starting from next year?

Ernesto Marcos, a former CFO of Pemex, the Mexican state company, has hazarded what looks like the first comprehensive guess.

His estimates, which Franklin Templeton Investments publishes in a note to clients, reckon that Mexico can count on $29bn in private investment in energy in 2018, the end of the administration of Enrique Peña Nieto, equivalent to 1.9 per cent of GDP. In 2020, the investment total could be $50bn, or 3 per cent of GDP, he reckons. Total private investment in energy may reach $161bn between 2014 and 2020.

How will the investment be broken down per sector? Mexico, after all, has a wealth of opportunities, including shale plays that are the geological continuation of US formations, and deep-water riches. But shale faces significant challenges including lack of water and infrastructure, and being located in areas prone to drug cartel violence that will add security concerns. Hydrocarbons in the depths of the Gulf of Mexico will take big investment and many years to extract.

Shale, not unsurprisingly, is expected to get off to a slow start with investment of $1bn next year. But it could gather pace speedily to $3bn in 2017, $6bn in 2018, $9bn in 2019 and $12bn in 2020, when Marcos’ consultancy, Marcos & Asociados, expects it to account for more than a fifth of all private energy investment in Mexico.

Investment in deep-water prospects is also expected to hit $6bn by the end of this administration, increasing to $9bn by 2020. The slightly slower pace underscores how much of a long-term investment deep-water is.

Most investment next year is likely in mature fields and gas pipelines. Gas processing is expected to take off from 2018, while mature fields and refinery modernisations will attract some $6bn each in 2020, according to the forecast.

Here are Marcos & Asociados’ estimates in full:

Source: Franklin Templeton Investments

So with Mexico’s economy set to grow still below initial expectations – the government is forecasting 3.7 per cent for next year – just how much will all this hydrocarbons investment boost the economy?

Significantly, Franklin Templeton says:

We still do not have a macroeconomic model that will translate this additional investment into growth for the Mexican economy. However, similar experiences of liberalising the energy sector in Brazil and Colombia indicate a multiplier effect from the additional investment of at least 1:1 on GDP.

We also have to take into account that these estmates do not include additional investment from the opening up of the electricity sector. This implies that an estimate of a level of growth of another 2 per cent of GDP from 2018 onwards ould be reasonable.

Of course, Pemex, the state oil company that is losing its monopoly, will continue to be a major player: Its investment budget from 2014-2020 alone is $209bn. Put that together with private investment and Mexico’s hydrocarbons sector is expected to suck in a whopping $370bn by 2020.

Fasten your seatbelts then. Mexico’s energy sector looks like being an exciting ride.

Read the article online on beyondbrics: Mexico counting on huge private investment in energy – beyondbrics - Blogs - FT.com