Alamos concerned over viability of Esperanza after new cyanide law
JOHANNESBURG (miningweekly.com) – TSX- and NYSE-listed Alamos Gold has raised “significant” concerns over the impact that a new state law in Mexico will have on the Esperanza gold project, in Morelos, which the Canadian gold producer is in the process of buying.
Last week, the Mexico government affected an amendment to Article 71 of the Law of Rural Sustainable Development, which restricts the use of cyanide in the state of Morelos.
Alamos commented that, while the nature or extent of the restrictions were unclear, the amendment had made specific reference to the Esperanza gold project, which had been contemplating the use of cyanide in its design plans.
Cyanide is used in the recovery of gold and silver in mining operations.
Precious metal exploration and development company Esperanza Resources commented that it would fully comply with the new laws and regulations relevant to its operations.
Alamos, in response to Esperanza Resources’ public acknowledgment of the new law, said it was engaging with its legal advisers in Mexico to further clarify the potential impact that the legislation would have on the viability of the gold project.
In July, Alamos offered to buy all the issued and outstanding shares of Esperanza. The transaction was subject to the fulfilment of certain conditions.
Alamos owns and operates the Mulatos mine, in Mexico.
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