Morena Senator Angélica García Arrieta yesterday presented a Bill that would obligate miners to seek permission from the communities around mining projects before beginning operations. The news caused Grupo México and Peñoles stocks to tumble on the Mexican Stock Exchange (BMV).
Grupo México stocks (GMEXICO B) fell to MX$41.64 on Tuesday from MX$44.02 on Friday, a drop of 5.4 percent. Similarly, Peñoles (PE&OLES) reached MX$254.37 on Tuesday, down 4.7 percent from MX$267.02 on Friday.
The proposal would mean that the Ministry of Economy and Mexican Geological Service (SGM) would be in charge of ensuring the community consultations are carried out for projects that affect indigenous areas. This new law is in line with that for energy projects currently in force in Mexico and includes the cancellation of concessions if the companies do not present an annual report on the social impact of the projects. Morena has a majority in both the Chamber of Deputies and the Senate so the motion is widely expected to pass.
In recent months there has been a spate of allegations against mining operators of violating labor and environmental laws. In October, Napoleon Gómez, former head of the National Mine, Metallurgical, Steel and Similar Workers (Los Mineros) trade union and now-Morena senate member, called for the Canadian government to investigate Canadian miners working in Mexico.
This has been one of the first indications of the policies that could be in store for the mining industry after the election of AMLO’s left-leaning Morena party. For more clues on the future of the industry, don’t miss our analysis on the Nation Project.
Don’t miss out on your chance to rub shoulders with the industry’s leaders at the launch of the new edition, Mexico Mining Forum 2019, at the Sheraton Maria Isabel hotel in Mexico City this February 6! Register here!