Mexico mining investment to drop in 2009, 2010

Thu Sep 24, 2009 12:38pm EDT

Seems to me that this news might mean that companies in or near production would stand to gain over time, especially if PM prices continue to climb.

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CUERNAVACA, Mexico, Sept 24 (Reuters) - Mexico's national mining chamber said on Thursday investment in new exploration projects and mine expansions would drop 25.3 percent in 2009 to $2.73 billion compared with a year ago as the financial crisis hits credit and metals prices.

Sergio Almazan, the head of the chamber, said investment in 2010 could drop even further to as little as $1.7 billion, 37.7 percent less than expected in 2009.

In 2008, when some metals prices were hitting record highs on international markets, investment in Mexico, a major copper and silver producer, reached $3.66 billion, Almazan said.

"The fall is in exploration projects in precious metals, copper (and) zinc ... Some expansion projects have also been put on hold," Almazan told a news conference.

Around 30,000 jobs in the sector have been lost due to the drop in investment and the slow down in the industry, he said. (Reporting Mica Rosenberg; Editing by Lisa Shumaker)