For­tuna Sil­ver Mines re­launches sus­pended projects as econ­omy im­proves

Com­pany em­pha­sizes Peru­vian roots and fam­ily-run qual­i­ties to nav­i­gate the com­plex­i­ties of the Latin Amer­i­can min­ing world


It was a dark patch, but the hard­ships of the past year, in par­tic­u­lar the im­pact of the fi­nan­cial cri­sis, have been gen­tler than an­tic­i­pated, said Luis Dario Ganoza Du­rant, chief fi­nan­cial of­fi­cer of Van­cou­ver­based For­tuna Sil­ver Mines, which placed sec­ond on Busi­ness BC’s list of the prov­ince’s fastest-grow­ing com­pa­nies this year, up from fourth in 2008.

“We were all in cri­sis mode. Ev­ery­thing that was not an im­me­di­ate need was shut down,” Ganoza Du­rant said.

“It’s safe to say that most com­pa­nies were con­tem­plat­ing a con­tin­gency plan in terms of a po­ten­tial shut­down of op­er­a­tions. We went through all of that. You had to run those types of ex­er­cises.

“We ad­justed bud­gets both for our as­sets and the cor­po­rate bud­get to re­flect a very tough year in terms of metal prices. No one knew how long the re­cov­ery would take,” Ganoza Du­rant said.

But a few months into 2009, the road started to turn, al­low­ing the com­pany to re-ex­am­ine its tight­ened spending plan, he said. “I think that [metal] prices have re­acted much faster than every­one thought they would. That has meant that we have been able to put force back into our plans and are re­launch­ing many projects that we had put on hold. Since the end of the sec­ond quar­ter, we have been loos­en­ing up a bit on bud­gets and cap­i­tal ex­pen­di­tures.”

For­tuna, which mines sil­ver and gold in Latin Amer­ica, has two main as­sets: The Cayl­loma sil­ver-zinc-lead mine in the south­ern high­lands of Are­quipa, Peru, and the San José sil­ver­gold project in Mex­ico.

The com­pany has of­ten touted its fam­ily-run roots and its na­tive in­sight for nav­i­gat­ing the Latin Amer­i­can min­ing world. Ganoza’s brother, Jorge Ganoza Du­rant, is the com­pany’s CEO and pres­i­dent, and their fa­ther, Jorge Ganoza Acairdi, is a mine chief op­er­at­ing of­fi­cer and a fourth-gen­er­a­tion Peru­vian miner.

In April of this year, this feel for the lo­cal en­vi­ron­ment — all the nu­ances and the in­vis­i­ble hoops — was tested when the San José mine was sub­jected to a twom­onth-long road block­ade.

“ We were sub­ject to a twom­onth protest that was per­pet­u­ated by peo­ple from out­side the town where the mine is lo­cated,” Ganoza Du­rant said. “ They claimed to be anti-min­ers. There were ac­cu­sa­tions of in­dus­trial con­tam­i­na­tion, which just were un­true.”

Looking ahead, Ganoza Du­rant said the com­pany hopes to re­launch so-called brown­fields ex­plo­ration (ba­si­cally search­ing around a known de­posit for fur­ther ones) in the area around its San José mine. This work was sus­pended last year at the height of the fi­nan­cial cri­sis and is slated to start again in early 2010.


For­tuna Sil­ver Mines CFO Luis Dario Ganoza Du­rant (right) with di­rec­tor Mario Szotlen­der in Van­cou­ver last week.

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