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MINE DEVELOPMENT NEWS Cerro San Pedro Gold/Silver Project Held Up

MEXICO Delays in obtaining an explosives permit have halted construction at the Cerro San Pedro heap leach gold/s...



MEXICO Delays in obtaining an explosives permit have halted construction at the Cerro San Pedro heap leach gold/silver project, says METALLICA RESOURCES of Toronto. Suspension of activity will result in the loss of 150 jobs. The project, located in the state of San Luis Potosi, is under development by Metallica’s wholly-owned Mexican subsidiary, MINERA SAN XAVIER.

Although Metallica believes it has complied with all the regulations concerning the explosives permit, the Mexican Secretariat of Defense is holding it up.

Worse yet, the company has not received assurance that its construction and operating licence, issued by the local municipality, will be renewed. The city consistently renewed the permissions for each of the past four years, and Metallica says it meets all the requirements to have them renewed.

The company is continuing its appeal of the previously announced Agrarian Court nullification of its 1997 Lease Agreement with the Ejido of Cerro San Pedro for the use of the land affected by the mining project. It is expected that the Mexican federal court will issue a ruling on this appeal no later than October 2004. During the appeals process the company continues to have legal access to the land. In addition to the legal appeal, Metallica has made formal application to the Federal Bureau of Mines for the grant of certain easements and temporary occupation allowing Minera San Xavier access to the lands required for the project.

The news is better from the El Morro copper/gold project in Chile. It has an inferred resource estimate equivalent to 6.2 billion lb of copper and 7.4 million oz of gold. Noranda can earn a 70% interest in the project. Learn more at www.metal-res.com.


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