Grupo Mexico will focus offshore if Mexico mining tax enacted – by Dorothy Kosich (Mineweb.com – October 29, 2013)

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Greater production from Grupo Mexico’s mining division increased third-quarter base metals sales, but precious metals sales declined.

RENO (MINEWEB) – Grupo Mexico warned Monday that Mexico’s proposed 7.5% tax on mining earnings–in addition to a 0.5% tax on precious metals revenue and the elimination of the immediate deduction on exploration expenses–“will jeopardize investment in current and future projects in the sector, along with the consequent effect on jobs and infrastructure.”

“If approved, we will conclude our current investment program of US$3.5 billion for 2013 and US$1.5 billion for 2014,” said the company.

“Nevertheless, we will be obliged to re-direct our future investment program of US$5.3 billion for the coming years, which is primarily allocated to Mexico, and analyze opportunities in countries where the investment conditions are more favorable, such as the US, Canada, Peru or Chile which offer a stable tax regime with stimuli and low energy costs,” Grupo Mexico advised.

Grupo’s mining division, the Americas Mining Corporation, reported that copper sales increased 2.3% in the third quarter from 201,670 tonnes in the third-quarter 2012 to 206,382 tonnes. For the first nine months of this year, however, copper sales declined to 592,447 tonnes, 5.7% lower than the 628,498 tonnes produced during the comparable period last year.

Molybdenum sales were up 5.5% in the third quarter from 4,468 tonnes in the third-quarter 2012 to 4,713 tonnes. For the first nine months of this year, moly sales were up 2.7% from 13,718 tonnes during the first nine months of 2012 to 14,088 tonnes.

Zinc sales increased 32.5% during the third quarter of this year from 18,451 tonnes in third-quarter 2012 to 24,440 tonnes. During the first nine months of the year zinc sales increased 2.7% from 66,867 tonnes for the first nine months of last year to 73,245 tonnes.

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