Are Mexican Mining Opportunities Over?By Jesús Enrique Pablo-Dorantes | Tue, 12/08/2020 - 09:00
"I would also like to point out that it has been clearly stated, and the president repeated it again on Sept. 1, that no more open-pit or open-pit mining concessions would be allowed."
This statement would be normal if it came from a group opposed to mining, during any public protest. It would be even more understandable if the person who uttered it celebrated their indigenous origin in their curriculum and was born in a state where there are no Mexican Geological Survey records of mining for metallic minerals.
In these cases, I would think that the statement was a consequence of ignorance and above all, of how we have failed to adequately communicate the role of mining in the history of Mexico.
However, my dismay stems from the fact that it came from the mouth of agronomist Maria Luisa Albores González, the current head of the Ministry of the Environment and Natural Resources (SEMARNAT), during her appearance in the Chamber of Deputies in November.
My concern does not arise from the fact that I am terrified by the ostentation that Albores makes of her profound ignorance about Mexican mining, which is an activity that only through income tax contributes more than US$1.5 billion annually to the federal government, in a country where more than 50 million people were living in poverty prior to the COVID-19 pandemic.
The statement is unacceptable in terms that it denotes complete ignorance of the legal framework that regulates the life of Mexicans and, particularly, of a person who has not even bothered to read the attributions that were commissioned to her.
In the first place, the entity in charge of the administration of the mining concessions is the Directorate of the Public Registry of Mining and Mining Rights, belonging to the Ministry of Economy, under the charge of Graciela Márquez Colín who in no way reports to Albores. Why does Albores take attributions that do not concern her?
According to the Sectorial Program of Economy 2020-2024, published in the Official Gazette of the Federation (DOF), the Economy Sector “has the mission of developing and implementing comprehensive policies for innovation, diversification, and productive and commercial inclusion, as well as to stimulate investment. national and foreign, and promote the use of mineral resources and boost the productivity and competitiveness of the economy, allowing its integration into regional and global value chains, in order to contribute to generating well-being for Mexicans.”
So where does this obvious confusion come from? We have a government that entrusts Minister Márquez to promote mining and, at the same time, an engineer, Albores, who demonizes it.
The vision of this government has weighed loyalty to its leader over technical capacity, which would explain the irresponsible declaration over an activity that, during the first quarter of 2020, attracted US$311.5 million in foreign investment.
Some of my clients, both national and foreign, feel completely confused. Pessimism prevails. They seem to forget that mining is a long-term, cyclical business.
Today, there are great opportunities to acquire mining concessions. Those projects that lost their cash flow, and were, unfortunately, also projects with excellent grade potential and technical, economic, social and environmental viability, are subject to strong pressure because, simply, SEMARNAT is forgetting that the spirit embodied in the General Law of Ecological Balance is “to establish the conditions to which the performance of works and activities that may cause ecological imbalance or exceed the limits and conditions established in the applicable provisions to protect the environment and preserve and restore ecosystems will be subject, in order to avoid or minimize its negative effects on the environment.”
Should we demand a change in leadership at SEMARNAT? I think that is not necessary. The leadership of a person with the background and sensitivity of Albores is relevant; however, it is evident that her advisers have failed to provide adequate information for assertive decision-making.
Mining is the only economic activity, with the exception of the government, that promotes the introduction of services into surrounding communities, such as drinking water, drainage, electricity and schools. When Albores expresses that she is horrified by an open pit, she forgets that an automotive plant receives through donation over three times the equivalent surface of one regular open pit, on which it builds its facilities. That auto company’s property taxes are then waved for many years and the company is given rights to exploit the groundwater, even at the expense of aquifers, while the pollution generated by the cars it makes is felt throughout the planet.
Finally, if the present government wishes to rule out mining as a tool that contributes to the development of our country, mainly in remote regions, then all it needs to do is modify the legal framework. It is not acceptable to apply the law for convenience, or even in a discretionary manner.