Mining at El Pinguico – the potential crown jewel of Guanajuato mining

August 5, 2020

by James Anderson, CEO at Vangold Mining

There are very few jurisdictions in the world that are truly mining friendly, and Mexico is one of them. Mining is generally accepted, encouraged and supported by the local people and all levels of the government. Unlike many other countries, if you discover something valuable at the end of a drill bit, you’re entitled to keep it – the government won’t confiscate it, and nor will anyone else.

Guanajuato and Mexico’s rich history

Guanajuato’s mining history extends to the sixteenth century, when the Spanish were drawn to the New World, rich in precious metals. Having arrived in Mexico in 1520, they began mineral exploration. By 1540, they had identified the hills in and around Guanajuato as areas to exploit for their abundant silver and gold deposits. In 1548 and 1554, silver was discovered in the areas of San Bernabé and Rayas. The discovery led to the settling of more people in the area, and Guanajuato became one of the premier mining districts of Nueva España or New Spain, as it was known at the time.

From the sixteenth century, Guanajuato produced an estimated 1.2 billion ounces of silver and 6 million ounces of gold, deeming it one of Mexico’s most important historic silver mining districts. The eighteenth century was considered the peak period for Guanajuato mines – Valenciana in particular was deemed as one of the world’s largest and richest silver mines.

Valenciana mine was Guanajuato mining’s crown jewel. From the late 1700s, the mine owners – the Counts of Valenciana became extremely wealthy and powerful, as the mine was contributing approximately 20 % supply to the world’s silver production. Valenciana’s first Count, Antonio de Obregón y Alcocer commissioned construction of San Cayetano Church, also known as La Valenciana Church near the mine’s entrance. The church was surrounded by thick and mighty stone walls supported by buttresses, resembling a medieval fortress.

Mining at Valenciana was undertaken along the Veta Madre or ‘Mother Vein’ – a regional formation that can be traced at surface for over 25 km (15.53 miles), and from which many mines have produced over the centuries. Veta Madre is somewhat unique given that it is a low sulfidation epithermal system mined over 600 m (1968.50 ft) of vertical extent, demonstrating the prolonged nature of the mineralizing event that introduced the silver and gold.

Today, Valenciana forms part of Great Panther Silver’s (GPR) Guanajuato Mine Complex, and GPR also own and operate the nearby San Ignacio Mine. Other companies and operations within the region include Endeavour Silver’s Bolanitos mine and mill, private company Electrum Group, led by New York billionaire, Tom Kaplan; and TSX-listed Argonaut Gold is developing the Cerro del Gallo deposit.

While Fresnillo PLC is in the process of returning to the area to refurbish Las Torres mine, just 2 km (1.24 miles) away from Vangold’s past producing El Pinguico mine.

Vangold Director, Bill Gehlen (left) discusses underground development with General Manager, Gerardo Dorado Cantu (right) and Head of Security, Eleuterio (background)

Vangold Mining’s El Pinguico mine project

Vangold Mining (Vangold) acquired the historic El Pinguico mine project in 2017. The property is located 7 km (4.35 miles) southeast of Guanajuato city, in the State of Guanajuato, Mexico. It consists of two mining concessions totaling 71 hectares.

Vangold’s historic mine is near several active, modern mining operations including Endeavour Silver’s El Cubo and Bolanitos mines and mill complexes. There are three other mills and numerous mines between Bolanitos and El Pinguico, with the closest being Fresnillo PLC’s Las Torres, located a mere 2 km (1.24 miles) away from El Pinguico.

El Pinguico was an industrious site one hundred years ago, with mining being undertaken on ten levels and from four shafts. A small train ran from El Pinguico’s shaft to a large cyanide plant on the far side of the property. But it was the ore grade that attracted so much interest and was deemed so special – the mining cut-off grade was approximately 15 grams per ton of gold equivalent.

Mining at the property started in the early 1890s, realizing great success in 1904 with the discovery of the actual El Pinguico vein – named after a small, native Mexican plant, flowering in abundance at the property. In summer, the flowers develop into small berries that locals use to make jam and the taste is likened to North America’s huckleberries.

Today, the property’s historic remains include mineralized material grading 1.25 to 1.35 grams per ton gold equivalent, which Vangold plan to ship to one of the local mills and monetize. Vangold currently access the mine using what is known as the #4 adit – open for 800 m (2624.67 ft) before encountering their underground stockpile. The passage is clean, dry and benefits from natural ventilation from other open shafts and adits, and is therefore deemed easy and straightforward. Vangold constructed a small head frame on top of the El Pinguico shaft, for future use and to access higher grade underground stockpile material.

Vangold’s immediate plans to advance the project include undertaking a 1000-ton (t) bulk sample from the surface stockpile material, utilizing one of the local mills. The sample is expected to provide invaluable data regarding metallurgy and metal recoveries, while demonstrating economic viability of direct shipping the material locally. The surface material is of marginal grade, although Vangold expect the sample will inspire confidence to pursue the underground stockpile, measuring approximately 150 000 ton (t). Trench sampling from 2017 measured the stockpile at 3.57 gpt AuEq at surface, suggesting direct shipping of material could prove to be quite lucrative.

Old shaft workings at the El Pinguico project

Future mining plans

Considering that the mine was deemed very high-grade 110 years ago, and cut-off grades were in the 15 grams per ton AuEq range, Vangold is mindful that there will be numerous exposures of vein stock-work systems that have never been drilled. Vangold intend to conduct both surface and underground drilling in late 2020 while also providing opportunity to discover additional high-grade, in-situ material.

Vangold plan to acquire a small underground drill to drill multiple shallow holes approximately 70 m to 100 m (229.66 ft to 328.08 ft) to hit the target. Numerous galleries still exist within the old workings that today’s drillers will be able to utilize to drill safely and comfortably.

Vangold plan to explore Veta Madre’s deep potential and expand its operations. El Pinguico vein systems is a splay or an extensional feature from Veta Madre. As Veta Madre dips to the west, at approximately 45 degrees, it should cross Vangold’s claim boundary. The high-grade El Pinguico vein intersecting with the Mother Vein makes for an exciting drill target, with the potential to become the second Valenciana deposit.

Underground workings, El Pinguico

About the company

Vangold Mining is an exploration company engaged in mineral projects in Mexico’s Guanajuato region. Board members include Dan Oliver, head of Myrmikan Capital LLC – a New York-based precious metal equity fund; Richard Silas, a stock exchange and corporate governance specialist; Mining Engineer, Hernan Dorado and newest recruit, William Gehlen – an American geologist now living in Vancouver, Canada.

For more info visit: