The Future of Open-Pit Mining in Mexico
FULL DISCLOSURE: This is sponsored content for Sonoro Gold.
Mexico’s mining industry finds itself at a pivotal juncture as President Claudia Sheinbaum’s administration reviews a proposed ban on open-pit mining. Originally approved by the lower chamber of Congress in August, the ban has stirred intense debate over environmental responsibilities, corporate interests, and the country’s economic trajectory.
“Open-pit mining warrants a thorough review, as activities such as sand extraction for cement production and lithium mining—critical for national development—are conducted using this method,” Sheinbaum said, emphasizing the importance of measuring the constitutional reform’s provisions.
Her statement came in the wake of a meeting Minister of Economy Marcelo Ebrard characterized as “productive,” during which government officials and leaders from the mining sector, including the Mexican Mining Chamber, explored ways to reconcile economic objectives with environmental imperatives. No concrete details on policy changes have been released, but Sheinbaum insists that any decisions will be guided by ecological necessity and remain “independent of corporate interests.”
Open-pit mining, which accounts for 60% of Mexico’s national mining and metallurgical output, generates enormous revenue and supports nearly 200,000 jobs. Industry advocates warn that prohibiting such a widely used extraction method could contract the nation’s GDP by about one percent and inflict serious harm on local communities.
Sheinbaum’s stance is regarded more conciliatory than that of her predecessor, Andrés Manuel López Obrador, who had proposed the ban. AMLO’s administration nationalized lithium, canceled concessions—now under arbitration—and restricted the permitting of new open-pit mines.
Opponents of the ban include a range of international and domestic operators: Southern Copper’s Buenavista copper mine, Newmont at Peñasquito, Fresnillo, and companies such as Teck Resources and Agnico Eagle Mines. Projects like San Nicolas, a partnership between Teck Resources and Agnico Eagle, depend on open-pit designs to remain viable.
The prospect of reversing the ban could bode well for Sonoro Gold’s (TSXV: SGO) flagship Cerro Caliche gold operation, located in the mineral-rich region of Sonora State. The site is in its final permitting stage for an initial open-pit, heap-leach mining operation designed to process around 12,000 tonnes of ore per day. Company assessments project a nine-year mine life, with potential to recover close to 300,000 ounces of gold equivalent over the initial nine year life of the mine.
One recent study projects an NPV of roughly US$71.4 million on a pre-tax basis, assuming a gold price of US$1,800 per ounce, with an IRR near 59%. Sonoro also estimates cash operating costs at around US$1,295 per gold-equivalent ounce.
Cerro Caliche’s strategic position between two world-class mining districts underscores its broader relevance to Mexico’s policy landscape. The region is already home to several established gold and silver operations, providing both a skilled workforce and robust infrastructure. As per the firm, only about 30% of the property’s identified mineralized zones have been drilled, with much of the potential gold-silver mineralization remains unexplored.
Sonoro Gold describes the property as hosting a “broadly mineralized, low-sulphidation epithermal vein structure,” making it particularly suitable for open-pit, heap-leach extraction methods–the same extraction style now under review at the highest levels of government.
FULL DISCLOSURE: Sonoro Gold Corp is a client of Canacom Group, the parent company of The Deep Dive. Canacom Group is currently long the equity of Sonoro Gold Corp. The author has been compensated to cover Sonoro Gold Corp on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. We may buy or sell securities in the company at any time. Always do additional research and consult a professional before purchasing a security.
