Reform to Mining Law Is Approved, State Now Controls Lithium
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Reform to Mining Law Is Approved, State Now Controls Lithium

Photo by:   Canal del Congreso
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Paloma Duran By Paloma Duran | Journalist and Industry Analyst - Tue, 04/19/2022 - 10:37

President López Obrador's new initiative to reform the Mining Law, which sought to nationalize lithium and ensure state control over the resource, has been approved after reaching a simple majority in Congress.

With 275 votes in favor, 24 against and 187 abstentions, the initiative to modify articles 1, 5, 9 and 10 of the Mining Law was approved yesterday, granting the State exclusive control of the exploration and production of lithium. Unlike the energy reform that was rejected on Sunday, the reform to the Mining Law did not need a qualified majority but a simple majority, since it does not entail a constitutional reform.

After the deputies discussed and proposed modifications to the initiative sent by López Obrador, the reform was approved with the support of MORENA, the Labor Party and the Green Party. Meanwhile, the deputies of the Go for Mexico coalition, consisting of PRI, PAN and PRD, abandoned the discussion and announced that they would abstain from voting. The only representatives actively opposing the reform were the legislators of the Citizen’s Movement.

What Does the Reform of the Mining Law Aim to Accomplish?

According to the document sent by López Obrador to Congress on Sunday, the reform seeks to “guarantee the self-determination of the nation, as well as the energy sovereignty of the people over lithium and other minerals that are strategic and necessary for the energy transition. In addition, to create a decentralized public body that oversees the exploration, production and use of the mineral.”

The new reform initiative was sent after the Chamber of Deputies announced the rejection of López Obrador's energy reform, which sought to strengthen CFE at the expense of private companies in the electricity sector and leave the exploitation of lithium in the hands of the government. In total, there were 275 votes in favor, 223 against and 0 abstentions. This reform was rejected because it did not reach a qualified majority, which requires the support of two-thirds of the Chamber.

During López Obrador's morning conference, he said the government was prepared for a “betrayal” by his opponents, for which it had a secondary plan to ensure lithium remained under government control. It is still uncertain what will happen to the companies that already have lithium concessions. However, experts believe that these projects will also be affected since López Obrador assured a few weeks ago that those with lithium projects will not be able to continue their developments due to the denial of permits.

Photo by:   Canal del Congreso

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