Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Mexico’s President Andrés Manuel López Obrador exhorted Vulcan Materials’ subsidiary, Calica, to accept his government’s $440 million offer for the 2,000 hectares it has under concession in the southeastern Quintana Roo state.
During a press conference, López Obrador accused the American company of causing an environmental disaster for the over 30 years it operated in a region surrounded by a jungle, underground rivers, cenotes and mangroves. He said authorities would not allow any more limestone extraction in the area.
AMLO noted that, despite his government’s offer, the company refuses to sell and demands a $1.5-billion compensation for the closure of its operation, which was ordered in May 2022.
“It is not possible to allow them to continue operating. We sent them a proposal to seek an agreement, but I think they are poorly advised,” the President said, adding that Vulcan’s shareholders seem to be waiting for the end of his term to go on with their work.
But López Obrador warned that he won’t leave the issue hanging and will put an end to it before leaving office. He also said that his administration plans to turn a section of the mine into a recreational facility and establish a protected area in the surrounding terrain.
The Mexican government shut down Vulcan Materials’ operations last year, citing concerns over the impact of the company’s underwater limestone extraction on the local ecosystem and water table.
Vulcan, on the other hand, has said that it has the necessary permits to operate and intends to vigorously pursue all lawful avenues available in order to protect its rights and resume normal operations.
The Alabama-based firm is a leading producer of gravel, sand and crushed stone and has several concessions in Quintana Roo, where it mines crushed limestone that is later shipped to the United States, where it is used in construction.
