Palmarejo, Mexico


The Palmarejo mine is located 420 kilometers by road southwest of the capital city of Chihuahua, and 15 kilometers northwest of the town of Témoris in the Témoris mining district of northern Mexico. Mining at Palmarejo, a modern silver and gold mine commissioned in 2009, is conducted both underground and on the surface. Coeur’s wholly owned subsidiary, Coeur Mexicana, employs over 900 people at Palmarejo while contractor employment totals about 150. Access to the property is via paved and all-weather dirt roads. Electric power is supplied by the local power utility and on-site generators used only for emergency. Read more, in Spanish, about Coeur Mexicana’s commitment to Community Relations and Environmental Stewardship.

Location Map Palmarejo
Stage: Production
Location: State of Chihuahua, Northern Mexico
Type: Open Pit/Underground
Metals: Silver and Gold
Product: Doré
Ownership: 100%
Land position: 135,131 acres
Production: 2015 = 65.1M oz Ag and 70,922 oz Au
Adjusted costs applicable to sales per silver equivalent ounce1: $13.03 per AgEq oz using a 60:1 ratio; $11.81 per realized AgEq oz
Proven and probable reserves2: ​​44.9M oz Ag and ​​690,000 oz Au
Measured and indicated resources2: 2​5.3M oz Ag and​ 3​30,000 oz Au
Inferred resources2: 8.2M oz Ag and ​​147,000 oz Au
Employees: ​765
  1. Non-GAAP financial measure. Please see Reconciliation to GAAP table.
  2. Please see Reserves and Resources statement.


The Palmarejo Property is located along the Sierra Madre Occidental silver-gold belt. Surface mining is by conventional drill and blast, truck and shovel operations. Underground mining is accessed from three primary portals to the underground ramp systems designed for life of mine access. The operation is running at full capacity.

Ore feed to the mill is from a combination of surface and underground sources. Ore is blended and fed through a primary crusher at a rate of approximately 6,000 tons per day. Processing entails grinding, flotation, carbon-in-leach and Merrill Crowe-electrowinning recovery of silver and gold and produces a doré, which is shipped to Coeur’s smelting and refining partners in the U.S. and Europe.

(Regarding royalties at Palmarejo, please see Palmarejo Gold Production Royalty Obligation.)

View the latest Technical Report for the Palmarejo mine.

Geology and Exploration Potential

The gold and silver deposits at the Palmarejo mine, typical of many of the other silver and gold deposits in the Sierra Madre, are classified as epithermal deposits and are hosted in multiple veins, breccias and fractures. These geologic structures trend generally northwest to southeast and dip either southwest or northeast. The dip on the structures ranges from about 45 degrees to 70 degrees. In the mineralized portions of the structures gold and silver are zoned from top to bottom with higher silver values occurring in the upper parts of the deposit and higher gold values in the lower parts, sometimes accompanied by base metal mineralization, though local variations are common. The Palmarejo property contains a number of mineralized zones or areas of interest. The most important of these to date is the Palmarejo zone in the north of the concessions which covers the old Palmarejo gold-silver mine formed at the intersection of the northwest-southeast trending La Prieta and La Blanca gold-and-silver bearing structures. In addition to Palmarejo, other mineralized vein and alteration systems in the district area have been identified all roughly sub-parallel to the Palmarejo zone. The most significant of these additional targets are the Guadalupe (including Animas) and La Patria vein systems in the southern part of the property which are currently under development and exploration by the Company. 

Exploration in 2015 was focused primarily around expanding and further defining the Gudalupe and Independencia deposits and defining the newly discovered Los Bancos and Nacion veins. A total of $6.8 million was spent in 2015 on mapping, sampling, drill target generation and drilling to identify and define new silver and gold mineralization. 

Palmarejo Gold Production Royalty Obligation

On January 21, 2009, the Company entered into a gold production royalty transaction with Franco-Nevada Corporation under which Franco-Nevada purchased a royalty covering 50% of the life of mine gold to be produced by Coeur from the Palmarejo mine. Coeur received $75.0 million in cash plus a warrant to acquire Franco-Nevada Common Shares (the "Franco-Nevada warrant"), which was valued at $3 million at closing of the Franco-Nevada transaction. In September 2010, the warrant was exercised and the related shares were sold for $10.0 million.

The royalty agreement provides for a minimum obligation to be paid monthly on a total of 400,000 ounces of gold, or 4,167 ounces per month over an initial eight year period. Each monthly payment is an amount equal to the greater of 4,167 ounces of gold or 50% of actual gold production multiplied by the excess of the monthly average market price of gold above $400 per ounce (the $400 floor is subject to a 1% annual inflation compounding adjustment beginning on January 21, 2013). 

After payments have been made on a total of 400,000 ounces of gold, the royalty obligation is payable in the amount of 50% of actual gold production per month multiplied by the excess of the monthly average market price of gold above $400 per ounce, adjusted as described above. Payments under the royalty agreement are to be made in cash or gold bullion.  

On October 2, 2014, Coeur terminated the Palmarejo gold production royalty effective upon completion of the minimum ounce delivery requirement. Subsequently, Coeur entered into a gold stream agreement with a subsidiary of Franco-Nevada Corporation whereby Coeur Mexicana will sell 50% of Coeur Mexicana Property gold production upon completion of the gold production royalty minimum ounce delivery requirement for the lesser of $800 or spot price per ounce. The properties acquired by Coeur in the Paramount acquisition are not subject to the Franco-Nevada gold production royalty or the gold stream agreement.

(For further information, please see “Debt and Royalty Obligation – Palmarejo Gold Production Royalty Obligation” in the Company’s latest Form 10-K and the Notes on “Debt and Capital Lease Obligations” and “Derivative Financial Instruments and Fair Value of Financial Instruments” in the Company’s latest Form 10-Q.)


In late 2014, drilling at Independencia (Coeur Mining, Inc) and the contiguous Don Ese (Paramount) validated that both veins connected at the property boundary – Don Ese represents the southeast extension of Coeur's Independencia structure.  Once the merger of both companies was completed, the combined mineralized vein/clavo will retain the name of Independencia Clavo.  Independencia is located approximately 800 meters east of Coeur's Guadalupe deposit, which is currently being developed. Based on the current resource estimates, Independencia consists of significantly higher grade silver and gold mineralization than Guadalupe but approximately the same tonnage.  Of significance, the portion of Independencia on the Paramount property is not subject to any non-government third-party royalty or stream obligations.

Additionally, Paramount controlled a much larger project area called San Miguel (yellow in map below), which covers over 121,000 hectares (approximately 299,000 acres) and completely surrounds Coeur's Palmarejo property.  The combined Coeur-Paramount geologic team is now evaluating the package employing recently-collected airborne magnetic data, stream-sediment geochemistry results and surface alteration visible in ASTER imagery.  There is potential for three new Guadalupe-sized mineral camps to emerge from this evaluation – these will be prioritized for exploratory drilling in coming years.

Paramount Status

In a part of the property referred to as the San Isidro Vein System, mineral resources have been drilled at three vein zones, referred to as San Miguel, La Union and San Antonio (see map below).  Each of these is under review for potential underground mining and synergies with the existing Palmarejo Mill.

Claim Map

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Coeur Mining, Inc.
104 S. Michigan Avenue, Suite 900 Chicago, Illinois, 60603 - (312) 489-5800