Palmarejo Gold-Silver Complex, Mexico

Palmarejo Location and Site Access Details

The Palmarejo Project is located approximately 420km via road southwest of the Chihuahua City, Chihuahua State, northern Mexico.

Overall, Palmarejo Operations comprises 71 mining concessions (27,227 ha).

The site can be accessed by paved Highways 16 and 127 up to the San Rafael Town in the Chihuahua State. From San Rafael, a gravel road stretches through Temoris to the Palmarejo Town. The town is adjacent to the processing plant.

A 35km gravel road connects Temoris with the mine site. There is also an airstrip located at the project’s site.

Mining and Ownership History

There is a long history of mining at Palmarejo.

In 1818, first gold-bearing minerals were discovered in the region. This was followed by the construction of first metalworks facility in 1892.

In 2003, modern mining operations commenced at the location.

Coeur acquired an initial interest in a site, which is now a part of the project, in 2008 and bought the adjacent land.

Subsequently, the company conducted geological mapping and sampling; surveys; and drilling works.

Mining at the open pit mine and underground mines began in 2008, and milling operations commenced a year later.

The open pit mining operations ended in 2016.

Operations at the Guadalupe underground mine, Independencia underground mine and at the La Nación underground mine began in 2014, 2016 and 2019, respectively.

In July 2014, Coeur Mining announced an updated mine plan and a Preliminary Economic Assessment (PEA) for the silver and gold mine. The company filed a technical report for Palmarejo in November 2015.

In November 2023, Coeur Mexicana signed a purchase agreement with a subsidiary of Fresnillo to acquire mining concessions adjacent to the Palmarejo complex. The $25m transaction includes concessions totalling nearly 7,000 acres and claims adjacent to two primary zones.

Geology and Mineralisation at Palmarejo 

The gold-silver project’s deposits are epithermal in nature and show intermediate and low sulphidation features. The project has two mining districts: Palmarejo and Guazapares.

The Palmarejo Mining District is underlain by shallow-dipping andesitic volcaniclastic rocks and flows and cut by rhyolite domes and dikes of the late Oligocene to early Miocene age, while Guazapares District consists of andesite and volcaniclastic sedimentary units with dacitic to rhyolitic intrusions.

Mineralisation in both districts shows vertical and lateral zoning and occurs along the northwest-trending faults.

The Palmarejo District has gold and silver deposits characterised by pervasive silicification, sheeted veins, and quartz-filled breccias. The types of minerals include pyrite, sphalerite, galena, and argentite (acanthite).

The Guazapares District contains gold and silver deposits characterised by multi-phase quartz veins, quartz + carbonate + pyrite veinlet stockworks, quartz-filled expansion breccias, and silicified hydrothermal breccias.

Mineral Reserves

As of December 2021, Palmarejo Operations had a total (measured + indicated) mineral resource estimate of 19,117kt containing 73,712koz silver at a grading of 120g/t, 1,047koz gold at a grading of 1.70g/t.

The inferred mineral resource estimate was 4,275kt containing 17,453koz silver at a grading of 127g/t, 246koz gold at a grading of 1.79g/t.

The total (proven + probable) mineral reserves of the project stood at 65.7M oz silver and 953,000 oz gold, effective December 2022.

Mining and Processing of Ore

Conventional underground mining methods and equipment are used to mine ores from the Guadalupe, Independencia, and La Nación mines of the Palmarejo Operations.

Guadalupe mine is accessed from surface via two ramps, while  Independencia mine deposit is reached via two portals. The La Nación mine has two levels.

The production rate is around 165,000tonnes/month.

The processing and recovery of ores is conducted by a processing plant operating at 91.3% availability 365 days per year. The plant has a throughput of 6,000t/day with upgrades increasing it up to 7,000t/day.

The process flowsheet includes a standard crushing and grinding circuit (a jaw crusher, a semi-autogenous grind (SAG) mill, and a ball mill) and a flotation circuit. The flotation circuit directs the flotation concentrate to a series of clarification tanks and then treated in agitated cyanidation tanks.

The flotation tailings are treated in agitated cyanidation tanks. Gold and silver are recovered from the leachates of the concentrate solution and tailings solution by a Merrill Crowe Circuit via a carbon in-leach (CIL) absorption, desorption, and recovery (ADR) system.

A technical report filed in February 2022 said that the Palmarejo Operations have nine years of mine life remaining.

Palmarejo Infrastructure

The important infrastructure at Palmarejo includes three operating underground mines, two shotcrete mixing plants, water treatment plants, a backfill cement mixing plant, ROM pads, a processing plant, tailings storage facilities and associated support.

Electricity is delivered by a 66km 115kV overhead transmission line from the CFE grid. Substations are located at the Guadalupe and Independencia mines on the surface and underground at the La Nación mine.

An emergency powerhouse is located near the processing plant and has 12 diesel generators. It is used during the main power outages.

Key Contractors Involved

In March 2008, Aker Kvaerner, now Aker Solutions, won the contract to carry out construction management of the Palmarejo Project.

Tierra Group International conducted dam safety inspections of the tailings storage facility, water diversion dam and channel, and environmental control dam of the project.