By Frank Jack Daniel and Monica Medel
MEXICO CITY (Reuters) - Mexican miner Penoles (PENOLES.MX: Quote, Profile, Research, Stock Buzz), the world's top silver refiner, will see output rise gradually for the next few years, then jump by about 10 million ounces in 2010 or 2011 as new projects start up.
Chief Executive Jaime Lomelin, speaking at the Reuters Latin American Investment Summit in Mexico City on Wednesday, said the company had no plans to expand through acquisitions but was increasing its exploration budget to $80 million in 2007 from $60 million in 2006.
"In these boom times for metals it is very difficult to buy companies or well-advanced projects, so we have focused basically on exploration," he said.
Penoles (PENOLES.MX: Quote, Profile, Research, Stock Buzz), which celebrates its 120th anniversary this year, is known as a cautious company that invests in exploration even when metals prices are low.
"The growth is a little slower, more organic, but in the end it is often cleaner growth," he said.
The company plans to produce 52 million ounces of silver this year, up from 49 million ounces in 2006, Lomelin said.
He said the silver company would increase production by 3 percent to 4 percent in 2008 and 2009 and predicted high metals prices would hold in that period.
"This bubble could last for some years yet, two or three years more," said Lomelin. Continued...
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