Orla secures final permit to advance underground mining at Camino Rojo

Orla Mining (TSX: OLA) (NYSE: ORLA) said Wednesday it’s received the environmental impact assessment (EIA) from Mexico’s Secretariat of Environment and Natural Resources for its Camino Rojo mine in Zacatecas province.  

The decision means Orla now has all the permits necessary, including the Change of Land Use approval, to mine the remainder of the oxide open pit, including the layback area, and to begin construction of an underground exploration decline to advance the Camino Rojo underground project.

Receipt of the EIA represents a “major milestone” for Orla, TD Securities analyst Wayne Lam said Thursday in a note.

“We view this as a significant, long-awaited catalyst that had impacted operations over the past few years, and now de-risks any prior potential for an impending shutdown beyond 2027,” he said.

The award also heralds “signs of positive change on the permitting front for mining operations in Mexico following significant regulatory delays” under the administration of former President Andres Manuel Lopez Obrador, Lam added.

Pit-wall slide

Building an underground operation below the existing Camino Rojo open pit would generate a net present value (NPV) of $1.3 billion (C$1.8 billion) and a 30% internal rate of return (IRR) at $3,100 per oz. gold over 17 years, Orla said in February.  

If a $5,000 per oz. gold assumption were used, the NPV would jump to $3.3 billion and the IRR to 61%. Initial capital required for this project is pegged at $608 million, while sustaining capital over the life of mine is estimated at $489 million, the company said. 

Average annual gold production over the first 10 years is projected to be 215,000 oz., with an expected average all-in sustaining cost of $1,304 per payable oz. of gold. The underground mining operation would be supported by its own crushing, grinding, and flotation circuits producing saleable concentrates. 

Camino Rojo produced 96,764 oz. of gold in 2025 – despite a July pit‑wall slide that occured along the temporary north wall of the mine’s open pit. Camino Rojo is located about 620 km northwest of Mexico City. 

Updated report

Orla also said it has filed an updated technical report for the property, and that the EIA grants it full authorization to complete the oxide open pit as outlined in the newly filed technical report. This includes the layback to the north and the east-west expansion, as well as extensions to the waste rock and low-grade stockpiles and associated infrastructure, it said.  

The EIA also authorizes the development of underground access works, including an exploration portal and decline, with work expected to begin as early as the second half of 2026.  

This will enable further resource definition and technical evaluation of the sulphide mineralization beneath the current open pit, a next step toward a potential transition to underground mining at Camino Rojo. 

Orla shares fell 7.6% to C$18.23 Thursday morning in Toronto amid a broad market rout, giving the company a market capitalization of C$6.3 billion. The stock has traded between C$10.43 and C$29.99 in the past year.