Mining Embraces Responsibility Amid Challenging Environment

Amid a challenging political environment for mining companies in Mexico, the industry is doubling down on ESG measures to mitigate its operational impact. This underscores a growing recognition within the sector of the need to address environmental concerns while navigating regulatory uncertainties.

On Feb. 5, 2024, President López Obrador delivered a reform package aimed at addressing different social and environmental issues, which include a ban on open-pit mining and water concessions restrictions on areas where the resource is scarce. This move has been met with criticism from industry insiders, who perceive it as part of the administration's confrontational stance toward the mining sector. 

Environmental protection and socially responsible mining have been a widely discussed topic among industry insiders. Recognizing the significant impact of their operations, companies have made substantial investments in ESG practices. According to AIMMGM Sinaloa, the mining sector invests over MX$60 billion (US$3.5 billion) in good environmental practices. “The mining sector has never denied its environmental impact but that does not mean that it is not working to make its operations more sustainable. The main problem here is the demonization of the sector,” said Alberto Vázquez, Partner, VHG Servicios Legales, S.C., in an interview with MBN. 

Water Management 

Although the mining sector consumes a relatively small amount of water, comprising just 0.35% of nationally concessioned water and relying on treated wastewater for over 60% of its supply, its operations often occur in regions with significant water scarcity. This has pushed mining companies to invest in developing more water-efficient processes, such as dry stack tailing, which according to Jim Norine, Vice President Southwestern USA, Ausenco, has proven to reduce water consumption by nearly 30% in certain projects. “I believe that Mexico could, and should, become a world leader in water-efficient mining technologies. Mexico certainly has the need, the opportunity, and the momentum to drive innovation and adoption in this area,” Norine added. 

Closure of Mining Projects 

AIMMGM Sinaloa noted that, unlike some other economic activities, mined sites are susceptible to remediation once mining activity concludes. Proper mine closure plans usually include environmental remediation measures, such as land reclamation and water management strategies. 

These closing mine projects involve socio-economic initiatives aimed at supporting affected communities during and after concluding mining activities. These initiatives could encompass vocational training programs and economic diversification projects like promoting agricultural activities, enhancing infrastructure, optimizing water use, and fostering alternative livelihood opportunities to maintain the economic well-being of the communities post-mining. For instance, Alfredo Phillips, External Consultant, Argonaut Gold, said the company was looking to transform its past producing mine La Colorada in Sonora into a mining ecotourism destination. 

Regulation vs International Standards 

Industry insiders stress that mining is one of the most heavily regulated industries in the world as it must comply with environmental and social requirements. This aligns with widely spread standards such as Towards Sustainable Mining (TSM). While standards are widely accepted in Canada, they are also being promoted within Mexican companies. 

Armando Ortega, President, CANCHAM's Mining Task Force, highlighted that CAMIMEX and the Mining Association of Canada (MAC) signed an agreement in March 2023 to promote the adoption of TSM protocols among CAMIMEX's membership. Ortega emphasized the significance of embracing standards like the World Council's Conflict-Free Gold Standard, which are widely accepted and contribute to a more responsible approach to mining.