Pan American Silver Approves La Colorada Skarn Decline Development in Mexico

Pan American Silver has moved the La Colorada skarn expansion from study momentum into funded critical-path development, approving US$265 million of project capital over five years for underground access works beneath one of Mexico’s established primary silver operations.

The approved capital will fund the 588 Decline Project, a major underground development drive initiated from the existing La Colorada vein mine’s 588RL drift, about 588 metres below surface. The decline is designed to access the 901, 902 and 903 skarn deposits, provide ventilation development and eventually connect to the bottom of a planned East Hoisting Shaft at about 1,350 metres below surface. 

The approval follows Pan American’s revised development plan for La Colorada, which combines continued production from the existing vein mine with future development of higher-grade portions of the skarn deposit and the newly identified eastern Candelaria silver resource.

The plan envisages conventional long-hole open stoping and a new 15,000 tonnes per day processing plant, while current La Colorada vein production continues through construction, commissioning and into the expanded operating period. 

The production implication is substantial. Pan American’s expanded mine concept is expected to significantly lift silver output, averaging 19.1 million ounces of silver annually during the peak five years after construction and ramp-up. For a company with a deep operating footprint across the Americas, La Colorada offers a brownfield expansion route with existing underground access, established workforce capacity and a known operating district rather than a greenfield build. 

The 2026 capital program has also been reset. Pan American now expects to spend US$92 million to US$95 million on the La Colorada Skarn Project this year, including the 588 Decline Project, up from earlier guidance of US$47 million to US$50 million.

That increase reflects the shift from engineering and drilling toward physical development of the underground access infrastructure required to mine the skarn system. 

La Colorada is already a producing underground silver-lead-zinc mine in Zacatecas, producing silver-rich lead and zinc concentrates through a flotation plant. The skarn discovery changes its scale profile by adding a large polymetallic system beneath and adjacent to the existing mine infrastructure. 

The development is timely for the silver market. Mine supply growth remains constrained across many primary silver jurisdictions, while industrial demand is being supported by solar manufacturing, electronics and electrification.

A funded access decline at La Colorada gives Pan American a defined engineering pathway toward one of the more consequential silver expansion projects now advancing in Mexico.