Government Acts as Conciliator in La Platosa

After announcing that the Platosa Union, located in Bermejillo, Durango, took action against Excellon Resources due to a salary increase denial, Durango’s Minister of Work, Israel Soto Peña, pointed out that mediation works between the two parties are already on course to prevent a cease of activities at the mine.

Soto Peña explained that the case is already in the Federal Center of Conciliation and Labor Record’s hands, since it is one of the entities responsible for these matters. The Ministry of Labor and the Ministry of Economic Development (SEDECO) of Durango will also act as intermediaries to resolve the situation.

The National Mining Metallurgical Union (FRENTE), argues that there was a violation to the Collective Work Contract because salary increments corresponding to this year were not given.

On its part, the Canadian company said that earlier last week the company and the union had agreed in principle on the terms of the 2022 collective bargaining arrangement following numerous concessions, stated Brendan Cahill, President and CEO.  Unfortunately, the agreement fell through, leading to union action.

"Our workers at Platosa have one of the most generous compensation structures in the Mexican mining industry and have benefitted greatly from both improved metal prices and improved productivity in recent years. We hope they also understand the challenges we are facing this year at Platosa. As always, we remain open to discussions and hope for a positive resolution in the near term,” added Cahill.

The negotiation revolves around silver, zinc and iron operations. Soto rejected the possibility of the company shutting down its operations in Durango, because there is willingness from both parties to keep dialogue open, come to an agreement and continue working.  

The Durango government is constantly approaching the involved parties trying for an environment of cordiality to prevail by respecting negotiation liberties and the autonomy of the union to make a decision.

Adding to this tense situation, at the beginning of the year, Excellon Resources announced that the company would evaluate the economic viability of operating its Platosa project beyond 2H22. Over the last two years, the company has faced the impact of dewatering rates, an increase in consumables prices, legislative changes and now labor actions from the mine’s union. The company said it would provide an update on its decision as its mining plans for 2022 are being carried out, which include advanced exploration work and strategic alternatives to unlock the value of its main assets.