President Otto Perez Molina has approved a new rule passed by the Congress last week, which rises taxes to transnational miners operating in the country from 1% to 10%.
The country’s congress passed Friday legislation to increase mining royalties from 5% to 10%.
The mine is expected to produce 4,000 tons/day of gold and silver concentrate during its 23 years of life.
The friendly deal creates a tMontreal-based gold-royalty company with a market capitalization of about $1.15 billion (Cdn$1.3 billion).
The company has paid a monthly dividend to its shareholders since 2003.
Investors in Canadian giants Barrick and Goldcorp have been running for the exits in ever-larger numbers, as each piece of bad news triggers massive sell-offs in the stocks.
The move comes as Chile's Supreme Court halted the $3.9 billion gold and copper project last month.
Value of low-grade ore stockpile at the Peñasquito mine dropped, raising average costs by $64/oz. and negatively affecting adjusted earnings by $0.04/share.
The country’s environmental authority criticized the Top Court decision saying the miner conducted proper consultation with local indigenous groups and shouldn’t have to do it again.
Once again the mining giant's $3.9 million project can't move forward until local indigenous groups who oppose it are better consulted.
The news represents a relief for local authorities, which have seen several projects halted in recent months.
Output for this year is expected to be between 40,000 and 60,000 ounces of gold, reaching 7,000 tonnes a day by 2018.
Local press is reporting the miner has already abandoned the operation, which was in its last year of active mine life.
CEO Chuck Jeannes says barring a major technological breakthrough global gold production probably peaked in 2013.
"Worst case scenario" for Mexican mine in final year of its life says Vancouver-based gold giant.
As of this year, the mine produced 37,000 ounces of gold.
Who were the top earners in 2013?
This is the third project in the past four moths to be given the go-ahead after an initial unfavourable ruling.
Vancouver-based company drives all-in costs down to $852/oz and also beats expectations with $1.1 billion in quarterly revenue.
The miner poured the initial dole bar at a weight of 100 kilograms containing an estimated 317 ounces of gold.
Move signifies departure for Vancouver-based miner.
Decision bodes well for mining firms.
In 2010 at the World Economic Forum, legendary investor George Soros called gold “the ultimate asset bubble.” He failed to mention, however, that his hedge fund had just doubled the size of its position in the yellow metal.
Among publicly traded companies, 40% have no women in the boardroom.
Company seeks smaller deals in Latin America after biggest in its history.
Cost of mining and exploring for gold and silver in the country has increased 13% and 20%, respectively, over the past year.
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