Fresnillo Provides Update on New Mexican Mining Law
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Fresnillo Provides Update on New Mexican Mining Law

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Karin Dilge By Karin Dilge | Journalist and Industry Analyst - Tue, 05/09/2023 - 02:42

Fresnillo released an update on the recent reform to Mexico's Federal Mining Law, which has now been enacted. The company is analyzing the reform in detail and for now it does not expect any significant impact on its current operations or advanced exploration projects.

Regarding mining concessions for current operations, Fresnillo reported that it has all necessary concessions currently in place to continue its operations regularly. None of the company's current operations are expected to be impacted by the new law and the average remaining term of these concessions is 28 years, subject to renewal at the end of their respective terms.

Furthermore, Fresnillo currently holds all concession permits for its main advanced exploration projects Orisyvo and Rodeo, with an average term of 33 years, which are also subject to renewal at the end of their respective terms. Therefore, the company does not anticipate any impact on these concessions due to the new law.

Regarding the deposit of tailings and industrial residues, Fresnillo is analyzing any possible implications of the new requirements. However, the company does not currently anticipate any significant adverse impact. The new legislation places greater emphasis on environmental and social obligations. However, as a company committed to sustainable mining of silver and gold, Fresnillo said it will continue to comply with environmental and social best practices and obligations where it operates.

Certain aspects of the new law may require additional clarification from the regulator, which would be accomplished through guidance and/or complementary regulation that is yet to be issued. Fresnillo will continue to engage with all relevant stakeholders to ensure it is meeting the requirements of the law, said the company.

On April 29, the joint committees on Mining and Regional Development, as well as Second Legislative Studies of the Senate, approved, without changes the bill that reforms the Mining Law, National Water Law, General Law of Ecological Balance and Protection of the Environment and the General Law for the Prevention and Comprehensive Management of Waste, regarding mining and water concessions.

Art. 15 of the aforementioned law orders that mining concessions are subject to the public domain regime of the Federation and confer the right to carry out the exploitation, benefit and use of minerals or substances subject to the application of the law. 

Additionally, the new legislation, which was dispatched to the Executive and is awaiting promulgation in the Official Gazette, reduced the duration of mining concessions from a maximum of 100 to 80 years. The text also establishes that exploratory activities are reserved to the State through the Mexican Geological Survey (SGM).

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