Mulatos Mine Mexico

Home Operations Producing Mines Mulatos, Mexico

Quick Facts

Ownership
100%
Location
Sonora, Mexico
Status
Operating
Operation
Open Pit, heap leach
Commodity
Gold

The Mulatos mine is Alamos Gold’s founding operation. It was acquired for $10 million and has produced over two million ounces of gold and generated more than $400 million in free cash flow since 2005. Mulatos remains a consistent gold producer, and significant cash flow generator, with strong exploration potential.

2019 Performance

Production

oz Au (thousands)

142

Total cash cost1

US$/oz

$784

Mine-Site All-in Sustaining Costs1

US$/oz

$868

1 Please refer to Cautionary Notes on non-GAAP Measures and Additional GAAP Measures.

Mineral Reserves and Resources

as of December 31, 20192

Proven and Probable
Mineral Reserves

000 oz Au

1,563

Measured and Indicated
Mineral Resources

000 oz Au

2,608

Inferred
Mineral Resources

000 oz Au

269

2 M&I Mineral Resources exclusive of Mineral Reserves. Please see 2019 year end Mineral Reserves and Resources statement for additional detail.

Mulatos Mine Map Larger

The Mulatos mine is located in the Sierra Madre Occidental mountain range in the east-central portion of the State of Sonora, Mexico. The mine is approximately 220 kilometres directly east of the City of Hermosillo.

Hans Kersten, General Manager, Mulatos mine Hans Kersten
General Manager
Sonora, Mexico

The Mulatos mine is a conventional open-pit, heap-leach operation with gold recovered through a carbon-in-column circuit. Ore is sourced from a number of open pits within the Mulatos District providing stable low-cost gold production. These include the main Mulatos and Cerro Pelon open pits as well as existing stockpiles. La Yaqui Grande is expected to provide future production while also driving combined costs lower at Mulatos given its higher grades.

The operation produced its one millionth ounce of gold in 2012 and achieved another significant milestone in 2019, producing its two millionth ounce. This also marked the end of the 5% NSR royalty that had been paid since 2005.

The Mulatos District is a large underexplored land package comprised of 28,773 hectares of mineral concessions with significant exploration potential. The operation has a six-year mine life based on current Mineral Reserves, similar to the start of production in 2005, demonstrating a strong track record of exploration success.

The Mulatos deposit was acquired in 2003 for $10 million. The operation was built at a cost of approximately $74 million with the first gold pour completed in 2005. The operation achieved commercial production in April 2006. Over the years, a number of expansions and productivity improvements have taken combined throughput from approximately 10,000 tpd to over 20,000 tpd.

In addition to its heap leach operations, Alamos constructed a mill to process ore from the Escondida high-grade zone until it was depleted in 2014, followed by the San Carlos high-grade underground deposit which was depleted in 2018. The higher-grade La Yaqui Phase I satellite project was built in 2017 and went on to produce approximately 60,000 ounces and generate over $35 million of free cash flow (net of $13 million of construction capital) before being depleted in 2019. Construction of the higher grade, high return Cerro Pelon project was completed in 2019 with initial production achieved ahead of schedule late in the year.

The Mulatos District occurs within the Sierra Madre Occidental volcanic province. The Mulatos mineral deposits are large epithermal, high-sulfidation, disseminated, gold deposits hosted within a mid-Tertiary dacitic dome complex. Gold mineralization is closely associated with silicic alteration within extensive areas of argillic and advanced argillic alteration. The Mulatos deposit proper is composed of the contiguous Estrella, El Salto, Mina Vieja, and Puerto del Aire resource areas. Within the larger Mulatos complex of concessions, and generally within 20 kilometres of the Mulatos deposit, geologically similar high sulfidation gold deposits, occurrences, or prospects are known. The principal ones include La Yaqui, Cerro Pelon, El Carricito, El Halcon, Las Carboneras and El Jaspe.

Gold deposits of the Mulatos district are considered to be high sulphidation, epithermal, disseminated systems. Precious metal mineralization at Mulatos is associated with intense silicic alteration (mostly vuggy silica), advanced argillic alteration, and the presence of hydrothermal breccias. Gold mineralization within the Mulatos deposit occurs primarily within areas of pervasive silicic alteration of the volcanic host rocks, and to a lesser extent, within advanced argillic alteration assemblages proximal to silicic alteration. The gold-bearing advanced argillic zones are dominated by pyrophyllite or dickite alteration. Silicic rocks host approximately 80% of the contained gold within the deposit.

Gold mineralization exists in oxide, mixed oxide/sulphide, and sulphide ore types, with pyrite as the primary sulphide mineral. The deposits are amenable to cyanidation in all ore types, but gold extraction decreases with decreasing levels of oxidation.

Conventional open-pit mining methods are utilized at Mulatos. This includes a typical drill, blast and load haul operation. Ore from the Main Mulatos pit and stockpiles is trucked to the Mulatos crushing circuit for processing. Ore from Cerro Pelon is trucked to its own dedicated crushing circuit.

The Mulatos processing facilities consist of a crushing circuit, heap leach pad and an adsorption-desorption-recovery (ADR) plant. Ore is crushed through a four-stage circuit after which it is conveyed, agglomerated, and stacked on the heap leach pad which is underlain by an impermeable plastic layer on top of a layer of compacted clay. A low-concentration cyanide solution is applied to the ore on the leach pad using a low-pressure irrigation sprinkler system. Ore from the Cerro Pelon crushing circuit is deposited onto the Mulatos leach pad.

The resulting gold-bearing solution is channeled to the pregnant solution pond and is then pumped to the carbon-in-column circuit, where gold is recovered from the solution. The barren solution is then recirculated to the heap leach pad with added cyanide as part of a closed circuit and in adherence to the principle of zero discharge. Gold recovered from the carbon-in-column circuit is captured via electrowinning after which doré bars are produced on site in the refinery.