Gerardo Durán
Director General
CLUMIN
/
View from the Top

Chihuahua’s Mining Sector in the Middle of Recovery Curve

By Paloma Duran | Fri, 06/03/2022 - 12:18

Q: To what degree did 2021 represent a year of recovery for Chihuahua’s mining industry?

A: 2021 was a good year, although the pandemic continued to impact the industry’s productivity. Overall, production levels have yet to reach optimal levels comparable to pre-pandemic output. Some productive units continue to suffer from obstructions. However, a significant degree of recovery was certainly achieved when compared to 2020. We expect that by the end of 2022, we will see the full recovery of Chihuahua’s mining industry.

Q: How would you describe the most important aspects of your ongoing conversation with Chihuahua’s state and federal authorities to manage the reopening of mines?

A: We have had a great relationship with Chihuahua’s state government. Along with the office of Gov. Maria Eugenia Campos Galván, the state has shown a great disposition toward the gradual reopening of mines and to supporting and promoting the mining sector in general. This represents a marked difference when compared to previous administrations. A key point relates to environmental regulations that affect our industry. Legally stipulated ecological prioritization led to a serious impact on mining activity Zacatecas, so we are grateful to see that Chihuahua’s communication channels with the authorities have remained open to manage these kinds of issues. The cluster has initiated meaningful exchanges of ideas regarding the matter.

The authorities have also been helpful on the issue of security, which is one of CLUMIN’s key priorities. We held a meeting recently with Chihuahua’s Ministry of Public Security and are completing the final stage of negotiations that will lead to the consolidation of the Chihuahua Mining Police. This also implies key training initiatives so that the newly inaugurated members of the industrial police body can identify the most relevant security issues that mining operations face. We want the Chihuahua Mining Police to be able to reliably identify whether a mineral shipment in transit originates from an illicit exchange so that they can support the legality and judicial certainty of our operations.

Q: How have local authorities helped CLUMIN in supporting social engagement work?

A: The cluster manages key projects for social and community engagement, which were significantly affected by the pandemic. We are launching initiatives to rebuild those bridges. CLUMIN has also received significant support from state and federal authorities in this matter. Mines represent some of the most important sources of employment and social investment for these communities. The response from the government suggests its acknowledgement of this fact, particularly when compared to previous administrations. Unfortunately, some communities continue to block access to mines in the state but we expect these negotiations to come to a peaceful and mutually beneficial conclusion within the short term.

Q: How will water management impact the future of Chihuahua’s mining projects?

A: CONAGUA is the ultimate authority here and the regulatory framework is as centrally managed as possible by CONAGUA so that clarity and legal certainty can be established and disputes can be avoided. Local and state-level directives need to be completely aligned with what CONAGUA has established. Contradictions between different institutions can create difficult conflicts that take a long time to be processed and resolved by the courts. In turn, this can lead to indefinite delays in productivity, which is economically detrimental to Chihuahua’s mining industry.

All communities have access to legal resources and defense mechanisms should they feel that their access to this essential resource is being impeded. Nevertheless, we prefer that these mechanisms are defined by CONAGUA or aligned with what CONAGUA has already set in stone. Therefore, CLUMIN plays an active role in ensuring that all the state’s mining projects are considered when designing ecological prioritization mandates and distribution guidelines for water resources and infrastructure. We do not want a prioritization for water use to be designed without previous knowledge of any possible mining project nearby. While ecological prioritization is enforced at a federal level, the state’s local government is still in charge of defining it, so we want to ensure that we work closely with them from the very beginning.

The Chihuahua Mining Cluster (CLUMIN) was created in 2013 to support the main mining units in the state. Its goals are to foster the development of local suppliers and attract more mining investment to Chihuahua.

Paloma Duran Paloma Duran Journalist and Industry Analyst