This week, Mexico Mining Review‘s interview of the week is with Alfredo Phillips, President of the Guerrero Mining Cluster to discuss its strategies and the importance of Guerrero as a mining state. The Cluster aims to strengthen the industry and its supply chain in the state of Guerrero. It works with the government and the private sector to establish priorities for the health of the industry, focusing on issues such as security, rule of law and the generation of economic development programs.
Q: How is the mining industry in Guerrero contributing to the state’s GDP and how does it benefit the local economy?
A: The official information we have indicates that in 2017 about MX$800 million of services and products were purchased from companies fiscally based in the state of Guerrero. That was basically a calculation of what Minera Media Luna and Los Filos spent, keeping in mind the former was blockaded for two months. We estimate that this year, Telson’s Campo Morado is spending about MX$30 million a month on services and products, half in the Arcelia region and the other half in Guerrero. Los Filos is spending about MX$80 million per month and Torex Gold is spending around MX$100 million per month. The numbers for this year could be well above MX$2 billion, which would far exceed our initial goal of MX$1.5 billion. In terms of direct employment and permanent contractors, the mining sector in Guerrero provides direct jobs to around 6,000-7,000 people. Multiplied by five or six mines, this equates to around 40,000 total direct and indirect jobs in the state. Assuming each of the workers provides for a family of four, mining is providing for around 200,000 people in the state. It also should be taken into consideration that mining jobs are the best-paid jobs in the region and among the best paid in the country. According to IMCO’s 2017 study, mining related degrees are the 4th best paid in the country with an average salary above $17,000 pesos a month plus benefits.
Q: What have been the Guerrero Cluster’s biggest achievements in the last year?
A: In 2018, we had a few ups and down in terms of mining operations. Minera Media Luna, the state’s largest operation and the country’s third largest gold mine, experienced an illegal blockade for several months, which distracted our attention. Although we were not working to our full capabilities, the main achievement was the strengthening of our value chain. We launched an ambitious value chain project together with CONCAINGRO, the Confederation of Chambers and Associations of Guerrero. The cluster alongside CONCAINGRO has developed a technological platform that includes a directory of companies and their specifications. We are developing a registry of the needs of the mining companies to cross-reference. This is based on a national CONCAMIN platform and this really simplifies the process for many businesses.
In addition, as part of the change in the government and the 2018 elections, the Cluster’s Board held a meeting with the mayors-elect from the Guerrero gold belt and that was very important in terms of setting up a common agenda between the companies, the cluster and the communities through their mayoral representation. We want to create a common working group to develop the value chain and for the cluster to understand regional needs and areas where we can help. This will also help the mayors to understand the importance of the mining industry. The Cluster has also held meetings with the newly elected members of the State Congress in order to openly discuss the benefits of mining for the region and make sure that public policy is aimed at making the environment more conducive to increased investment with a responsible focus.
Q: What have been the main advancements of your agreement with Sudbury, Canada?
A: With all the recent events, the establishing of the Technology Hub in Iguala was not a priority but right now it is a topic that greatly interests the new mayor-elect of Iguala. There are many companies from Sudbury that have been working with the mines in their underground operations and as such they are setting up shop in Iguala. We have continued promoting a joint collaboration with Sudbury and we are still working on the idea of a mining industrial shelter program in Iguala. I believe the municipality can be an example for the mining industry.
We are also working on an agreement between Sudbury’s Laurentian University, which is one of the leading universities in underground mineral exploration globally, and Universidad Español in Acapulco to create specialized training programs. The initially agreement will focus on four key areas, including environmental protection. We hope to have one of the first training programs released by the end of 2018.
This is an exclusive preview of the 2019 edition of Mexico Mining Review. If you want to get all the information, plus other relevant insights regarding this industry, pre-order your copy Mexico Mining Review or access our digital copy of the 2018 edition.