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News Article

Landmark Community Agreement Reached at Peñasquito

By Alejandro Ehrenberg | Fri, 08/21/2020 - 17:18

Newmont Corporation announced that all outstanding disputes between the company and the Cedros community have been resolved. The latter has been involved in a series of blockades to the company’s Peñasquito mine in Zacatecas. The resolution was reached after the Cedros General Assembly ratified the definitive agreement that was reached with Newmont on April 22, 2020. 

As described by the company, Peñasquito is a world-class asset with over 8 million Au oz and approximately 26 million Au Eq oz in reserves. The significant exploration potential in Peñasquito’s prospective district may allow the company to extend value delivery for decades to come, noted Newmont.

The agreement was developed with the support of Mexico’s Ministry of Interior, the Government of the State of Zacatecas, the Undersecretary of Mining and the Mining Union, highlighted the company. It was signed by elected representatives of the Cedros community.

“Through the comprehensive application of Newmont’s sustainability practices at Peñasquito, we achieved a significant milestone with the formal ratification of the agreement that was reached earlier this year with the Cedros community. We are pleased to bring months of negotiation with the Cedros community to a close and look forward to sustainably operating in this region for decades to come. It is only through patient and transparent community engagement, combined with strong government support, that we have been able to reach a lasting solution that is beneficial to all stakeholders,” said Tom Palmer, Newmont’s President and CEO.

The ratified agreement includes land use, water availability, infrastructure and social investments. It involves access to more than 10,000ha of the Cedros ejido’s land for exploration, mineral production and other operational purposes and resolves all outstanding disputes between the two parties. The agreement expressly states that any future disputes will be resolved through dialogue and free of blockades.

Last year, Peñasquito was intermittently blockaded amid tensions with the community. Due to the blockades, 3Q19 production was hit by 11,000 Au oz, 1.7 million Ag oz, 13.7 million Pb lb and 22.8 million Zn lb, reported Reuters.

The news outlet explained that Newmont’s operations at Peñasquito have been affected by disputes with local truckers and claims of water hoarding. On the other hand, Newmont has pointed at local leaders for utilizing social concerns to obtain benefits by unfair means from the company.

Reuters noted that President López Obrador stepped into the situation. “The president accused some of the protest leaders of seeking money rather than legitimate social goals. He asked the parties involved in the conflict to resolve their differences,” the news organization said.

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Alejandro Ehrenberg Alejandro Ehrenberg Journalist and Industry Analyst