Hector Herrera Ordoñez
Partner
Haynes and Boone
/
View from the Top

Environmental Negligence Threatens Mining Operations

Wed, 10/21/2015 - 16:30

Q: How much pollution does the mining industry actually generate?

A: While mining companies provide benefits such as jobs, infrastructure, and healthcare to nearby communities, they are often severely criticized because of the mistakes they make. Accidents in the mining industry happen as they do in the oil industry. Yet, neither of these industries represents the largest source of pollution in Mexico. Contrary to what people believe, the main sources of pollution in Mexico are municipal governments. According to the Constitution, municipal governments are in charge of treating municipal water discharges, yet most do not comply with their obligations. The total volume of discharge from municipal governments and the concentration of pollutants that they introduce to water resources are greater and more harmful than the pollutants emitted by the private sector. Mining companies control their emissions for fear of being shut down, but there is little control on the pollution emitted by municipalities. When referring strictly to the pollution generated in Mexico’s mining sector, the largest threat to the environment is that generated by small-scale mining. Small-scale mining operations often do not follow norms or standards, nor do they seek to prevent harm to the environment or their workers. Many diseases caused by pollution in small towns are caused by illegal mining activities. As it is hard for PROFEPA to regulate pollution from small businesses, it is hard for it to regulate small-scale mining.

Q: How effective are Mexico’s laws at regulating the environmental risks associated with mining, and what steps can be taken against those who break these laws?

A: The General Law of Ecological Balance and Environmental Protection enacted in 1988 has been subject to many amendments and now stands out as the most relevant environmental federal law in Mexico. It covers most of the relevant environmental issues, follows some of the best practices set by international standards, and serves as legal protection against pollution. It is closely linked to Article 4 of the Constitution which sets forth the right for a healthy environment. There is no country that entirely prohibits pollution though. Countries instead set forth their own permitted concentrations of specific pollutants. If all pollution was prohibited, there would be no industrial activity on the planet. For example, all mining projects need to clear the area of vegetation and top soil, since there is no other way of extracting the minerals. This however requires a permit from SEMARNAT, which is issued after an environmental impact assessment is carried out on the property. Mexico’s laws give every individual or company the right to file a complaint through PROFEPA against any other individual, company, or governmental entity which does not comply with the environmental laws. After a complaint has been filed, PROFEPA issues a resolution on whether or not there are grounds to carry out an inspection. If there are reasons to think that a company is not complying, such as signs of smoke or illness in a community, PROFEPA typically proceeds with an inspection visit. When an environmental liability takes place, the accused will be subject to a procedure to resolve if he is guilty or not. Not complying with Mexican environmental legislation can lead to liabilities and sanctions for companies in the scope of criminal, civil, administrative, and even international law.

Q: What types of studies do mining companies have to present to SEMARNAT to carry out mining operations?

A: Environmental impact assessments are necessary and are meant to outline strategies to reduce the environmental impact and outline a remediation plan. Companies also have to present an environmental risk study in which they list all the possible risks of pollution that could be caused by their operations. The way that new mining projects need to be structured depends on these risks. However, old mines were not designed to mitigate risks and prevent environmental damage. With the technology available nowadays, almost any risk can be prevented though. Environmental disasters happen either because a mine is old and not initially designed to mitigate risks, or due to insufficient risk studies. Yet, there is no excuse for not taking the necessary precautions to prevent accidents, whether the company owns a new or an old mine. Unfortunately, many mining leaders in Mexico still do not understand the need to take preventive measures. This differs in countries like Canada, where companies listed on the stock exchange boast about their efforts to mitigate risks and reduce environmental impact to attract more investors. Such companies show that it makes good business sense to follow environmental best practices.