Why Mexico? Rated #4 Most Favoured Country Globally for Mineral Exploration (Metals Economics Group, 2011) Ranked #5 in Countries Favourable for Mining Investment, 2012 (Behre Dolbear, 2012) Highest ranked country for tax regime (Behre Dolbear, 2012) with low taxation rates and no mining royalties 500+ years of mining history Political and financial stability with North American-style legal and financial systems Strategic geographical location in world class mining region 14th Largest Economy in the World – Member of G20 Overview Mexico is a mining-friendly country with stable political and financial systems, a long mining history, rational environmental policies, excellent infrastructure and a firm government and bureaucratic commitment to the development of natural resources. It offers the exploration and mining industry a favourable investment and operating climate in a country enriched in mineral resources. Prospectivity World-class mining districts and mines are present throughout Mexico. The country is a major producer of silver, gold, copper, lead, zinc and molybdenum. Numerous new mining operations have recently commenced or are currently in development, and the country has recently become a focus for exploration and mining companies of all sizes. Azure Minerals’ projects are located within the State of Sonora in the world famous Sierra Madre Occidental province of northwestern Mexico. This historic trend has produced approximately 40 million ounces of gold and 2,000 million (2Boz) ounces of silver over the past 400 years and has become an area of global focus in the search for new precious metal deposits. Mexico is the world’s premier silver exploration and mining country for several reasons. It is historically and continues to be, the world’s number one silver producer with an historic production of over 10 billion ounces of silver and current annual production in excess of 100 million ounces a year. Most deposits are high grade and amenable to low-cost underground and open pit mining. Significant production of silver also occurs as a by-product of gold, and copper, lead and zinc mining activities. Sovereign Risk Numerous country-risk surveys place Mexico near the top of the “Most Favoured” list when assessing and comparing the suitability and risk of investment. Recently, Mexico has been ranked 5th (2012) and 4th (2011) in Countries Favourable for Mining Investment in assessments by Behre Dolbear & Company Inc, out of 25 countries which host major exploration and mining operations. In the same report, Mexico was listed as the top country for tax regimes and in the Top 3 countries for fewest permitting delays. Mexico has a 500-year mining history, with mining forming an integral part of the national and local economies. Culturally, Mexicans look very favourably on mining at all levels. There is strong government support for exploration and mining activities, and this is enhanced by the various bureaucratic departments and organisations charged with administering and assisting the industry. Politically, Mexico is a democratic republic providing the most stable political environment in Latin America. The government has implemented favourable, straightforward mining legislation for the express purpose of attracting foreign mining investment. This was accompanied by privatisation of all Mexican governmental mining holdings and an active retreat from competition with the private sector in mining exploration and development. Mexico has demonstrated a strong commitment to increasing transparency in all aspects of government, and the deregulation of the mining industry is arguably the most successful of these. Mexico has strong environmental laws and regulations, and a commitment to uphold them. Mining companies that follow Mexican laws and internationally accepted environmental practices can expect their development projects to advance without undue interference or delay. Mexico has been a party to the North American Free Trade Agreement (NAFTA) since 1994 and thus has a tax and trade regime comparable to the USA and Canada. It operates under western-style legal and accounting systems, with a contemporary taxation system and no mining royalties. The Mexican mining community is well trained and educated, both for professional and technical personnel, and at the skilled labour level. Specialised and standard mining equipment and services are readily available with good technical support. The Mexican Geological Survey has excellent geological databases and other technical resources readily available at little or no cost. Mining Law Mineral exploration and mining in Mexico are regulated by the Mining Law of 1992 (as amended in 2005), which establishes that all minerals found in Mexican territory are owned by the Mexican nation, and that private parties may exploit such minerals (except oil and nuclear fuel minerals) through mining licenses, or concessions, granted by the Federal Government. A Mining Concession gives the holder both exploration and exploitation rights subject to the payment of relevant taxes. Mining Concessions have a term of 50 years from the date the exploration concession was registered. Concessions may be granted to (or acquired by, since they are freely transferable) Mexican individuals, local communities with collective ownership of the land known as “ejidos”, and companies incorporated in Mexico pursuant to Mexican law. There are no restrictions on foreign ownership of Mexican companies. Foreigners wishing to engage in mining in Mexico must establish a Mexican corporation for that purpose, or enter into joint ventures with Mexican individuals or corporations. To this end, Azure Minerals has incorporated a 100% owned Mexican subsidiary company called Minera Piedra Azul SA de CV.
Posted on: Sun, 28 Sep 2014 18:56:43 +0000
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