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Chicago - With the soaring metals prices of the past few years, prospective mining districts across the world have attracted new investment from juniors and majors alike. After a recent site visit to multiple explorers in the Mexican state of Chihuahua, its evident that the Sierra Madre belt of Mexico could be among the most prospective of these.

Beyond its close proximity for North American firms and relative political stability, the Sierra Madres also provide access to relatively stable Mexican peso-based operating costs (its one of the few currencies that hasnt strengthened appreciably against the dollar).

Finally, many parts of the region are historically under-explored thanks to the Mexican government holding many of todays current targets within their National Mineral Reserve for the last several mining booms.

The attractiveness of the Sierra Madres and Chihuahua State in particular is no secret to the major miners of the world. Explorers and producers alike have flocked to the region, with 12 new mines opened in the last 2 years and countless exploration programmes in progress.

Notable development successes in the region include Agnico-Eagles [NYSE:AEM; TSX:AEM] Pinos Altos mine, Goldcorps [NYSE:GG; TSX:G] El Sauzal mine and Minefinders [AMEX:MFN; TSX:MFL] Dolores project.

Future Consolidation Wave

With major mining firms discovering few appreciably-sized assets in the past few years, the impetus behind industry-wide consolidation isnt that hard to imagine.

Palmarejo

Digging Into Profits

During my recent visit, I was able to hear about West Timmins Minings [TSX:WTM] Montana de Oro project, which is considerably more advanced than its historically fascinating Lluvia de Oro property.

After landing by helicopter at West Timmins office in Zataque, CEO Darin Wagner spoke in detail about the exciting prospects at Montana de Oro (which itself is probably not as well known as the companys Canadian targets near Timmins, Ontario).

West Timmins Drill

The firm acquired the project from the Mexican National Mineral Reserve after discovering overlooked worked from the 1940s by an Anaconda Mining geologist that found an intercept of 18 metres with 1.5 g/t gold.

The firm may be quite close to turning Montana de Oro into a literal mountain of gold if it continues to find success with its 2008 drill programme.

Most prospective among the Montana property is the La Dura West target, a high value near surface polymetallic that has had an average grade from 7 intercepts to date of 16.78 metres at 4.44% zinc, 0.45% copper, 25.31 g/t silver and 0.40 g/t gold.

Montana de Oro Hole 29

The team is most excited about the results that have come out of hole 29 on the property. While assay results arent yet back, the core from the hole was on display at West Timmins office.

Senior Project Manager Linus Keating declined to go into details given the ongoing assay work and continuing long-term land lease negotiations with the local ejido, but mysteriously noted that "if this plans out like we think it will, its going to be a classic case study in porphyry discovery." Or, as Wagner said of the site, "so far its looking attractive from that big tonnage, bulk mining point of view."

With road and power access nearby, the infrastructure on Montana de Oro is already well developed, making this property one to watch as the drill and assay results continue to come in over the next few weeks.

San Miguel

A visit to Paramount Gold [AMEX:PZG; TSX:PZG] also revealed a project with serious exploration potential.

The firms gold-silver San Miguel target is located on a historic mining site, and is surrounded by claims from Mexican mining titan Peoles and Mexoro Minerals [OTC:MXOM], making consolidation of the claim a potential option down the road.

The site is characterized by a gold-rich vein some 2-kilometre long and open along strike. Drilling has continued as deep at 250 metres on the site, with some 30-plus holes to date, including 9 metres of 2.99 g/t gold and 149 g/t silver.

Conclusion

Mexicos Sierra Madres are home to dozens of explorers digging into many of the regions overlooked metal deposits.

With senior miners scrambling to boost reserves and find friendly operating climes, it may only be a matter of time before some of the names start to disappear.