The mining industry is asking the federal government to improve the security outlook of the country as companies have been subject to extortion and thefts, which has increased operational costs.
Mining companies have reported that insecurity, an enduring problem in Mexico, is also affecting the mining industry, as they continue to be targeted by organized crime. This has led some companies to increase their budgets by 10 percent to protect themselves, as well as others to give in to protection rackets offered by the criminal organizations. According to the Association of Miners, Metallurgists and Geologic Engineers (AIMMGM), the lack of security impacts important mining areas like Sonora, Chihuahua, Zacatecas and Guerrero. “Insecurity has affected Mexico’s most important mining regions like Sonora, Chihuahua, Zacatecas, Guerrero and the State of Mexico, where companies have had to assign between 5 to 10 percent more to their security budget to deal with the high levels of insecurity,” said Luis Vázquez, President, AIMMGM.
Vázquez said that states with long mining histories like Chihuahua, the State of Mexico, Guanajuato, Sonora and Zacatecas rank among the states with the highest perceived insecurity. He admitted that some companies have even paid off criminal gangs, which resulted in an increase of 3 percent in the final costs of produced minerals. Alfredo Phillips, Local Director and Vice President of Corporate Matters, Argonaut Gold, concurred and said that companies in high-risk areas like Guerrero and Zacatecas direct 2 percent of their budget to security. “Two percent is a brutally high figure, especially if we take into account that mining companies operating in low-risk areas award less than 0.5 percent of their budget in security and felony prevention,” Phillips added.
Phillips said that mining companies can hire private security to prevent and avoid thefts, but this measure is insufficient since private companies cannot prosecute crime, an essential step to reduce high crime rates.
Regarding thefts, mining companies frequently struggle to protect their minerals and explosives. On Oct. 19, 2022, MBN reported that affiliated members of the Mexican Mining Chamber (CAMIMEX) continue to suffer from thefts despite the support provided by the Ministry of Defense (SEDENA). According to Juan Peña, President of the Commission on Safety and Health at Work, CAMIMEX, the thefts of explosives are used to maintain illicit mining projects. “The biggest problem occurs in underground mining. All these supplies like explosives have a barcode that can detect to whom they were sold. This enables SEDENA to carry out controls. however, since illegal mining cannot buy these explosives legally, they obtain them illegally,” Peña added.