Mexican silver miner Fresnillo Plc will purchase Newmont Mining’s 44% stake in Penmont, their Mexican gold mining joint venture, for $450 million in cash. The agreement, including three mines, gives London-listed Fresnillo full control of exploration and other prospects in and near northern Mexico’s Herradura corridor.

Fresnillo, primarily a silver miner, forecasts gold to represent 50% of earnings by 2018 following the agreement. According to Fresnillo CEO Octavio Alvídrez, it will enable “significant exploration and development potential in a region where we are experienced operators.” Fresnillo operates three other projects in Mexico and forecasts 43 million silver oz in 2014 guidance.

Fresnillo officials nonetheless acknowledged that processing plant complications at Penmont’s Herradura mine are reducing production, according to Reuters News. Company representatives said this could equal a reduction up to 8% in its 2014 guidance of 450,000 oz. But Fresnillo anticipates a full recovery by next year.

Subsequent to the buyout, Fresnillo forecasts an annualized capacity up to 620,000 oz gold before ramping up to 750,000 oz by 2018. Newmont’s pretax profit in the Mexico stake was $33.4 million last year.

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