Mexico miners face rising risks on indigenous lands

Mining companies with assets on indigenous lands in Mexico are facing growing risks, as emboldened communities seek to disrupt further mines and projects following a landmark court ruling.

The supreme court last month suspended Almaden Minerals’ Ixtaca (Tuligtic) gold project concessions (pictured) in Puebla state following an amparo or injunction sought by the local Tecoltemi Nahua community, which claimed the titles were invalid as the community was not consulted.

In its ruling, the court stated that Mexican authorities have an obligation to carry out consultations with indigenous peoples over activities that can impact their lives and surroundings, such as mining.

This right of indigenous communities to prior consultation is enshrined in Mexico’s constitution and the International Labour Organization’s Convention 169 (ILO 169), which the country ratified in 1990, judges said.

The decision sparked concerns that communities and NGOs will seek to halt other projects and even mines already operating on similar grounds.

“NGOs have done that in the past with litigation in other courts, so they will definitely use this [ruling] ... in other cases, and try and move them in the same direction,” Alejandra Soto, associate director at UK-based Control Risks’ Mexico City offices, told BNamericas

There are signs that groups are already planning further steps, with local NGO Fundar describing the ruling as of great significance to indigenous communities nationwide.

Other mining assets in Mexico that indigenous groups are calling to be halted include Fortuna Silver's San José silver-gold mine in Oaxaca state, which some indigenous residents say has impacted their human rights.

NO GUARANTEES

But there is no guarantee that ongoing or future cases will have a similar outcome to that at Ixtaca.

A single resolution by the supreme court does not become law or a mandatory precedent, Baker McKenzie Mexico partner Jorge Ruiz told BNamericas previously.

To become law, five continuous resolutions on the same matter must be made by the court.

“There is more room for [concessions cancellations] now with this supreme court ruling because other cases litigated in other courts have been there for a while,” Soto added.

“It doesn’t mean all cases will end up like this but it does open the door for new cases like this.”

The Ixtaca ruling also shows the court is willing to take on mining companies and rule in favor of indigenous communities.

This attitude mirrors that of President Andrés López Obrador’s (AMLO) administration, with the president often being openly critical of the sector’s social and environmental track record and promising to put communities first.

“[The supreme court] does appear to align with the executive branch’s guidelines of disliking some mining projects and having this rhetoric on respecting indigenous communities,” Soto said.

LACK OF REGULATIONS

The situation is particularly complex for mining companies given the absence of a uniform framework stating how consultations with indigenous communities should be done.

A similar lack of regulations relating to ILO 169 consultations led to mine suspensions in neighboring Guatemala, where Pan American Silver's Escobal primary silver asset has been halted pending conclusion of an ongoing consultation since 2017.

There is a risk of a similar string of suspensions in Mexico, according to Ruiz.

Another element of uncertainty stems from indigenous communities’ own governance mechanisms, which can differ from one settlement to another, Soto said.

“There are a lot of players that take advantage of that,” she added.

The lack of clarity and standardization on how consultations should be carried out has given rise to mining projects being pushed through with inadequate engagement with communities and also elements within indigenous communities sabotaging legitimate project proposals.

TEMPORARY HALT?

Almaden has said that the supreme court ruling is preliminary and may change, and that it allows for its concessions to be restored once a consultation is completed.

The view is shared by Mexican mining chamber Camimex.

“Once the reasons for which the concessions are declared groundless are resolved, they would be restored,” chamber president Jaime Gutiérrez told a recent webinar hosted by Mexican geologists and mining engineers association AIMMGM.

Legal experts also agree that companies whose concessions are impacted by similar rulings are protected by Mexico’s legal framework and they could seek reviews, appeals and constitutional reviews, as well as international arbitration claims, in some cases.