AMLO: Mexico offered US firm Vulcan over US$400mn to avoid legal conflict

Mexico offered US company Vulcan Materials compensation of at least 8 billion pesos (US$408 million) and promised to ignore potential environmental damage to avoid a lawsuit over closing its operations in the country, President Andrés Manuel López Obrador said.

The government recently published the decree in the official gazette that creates 53,000ha of protected natural area in Quintana Roo and includes Vulcan's limestone quarry in Playa del Carmen and a port.

“We didn’t want a legal confrontation, I think we offered them eight or 10 billion pesos, without taking into account all the damage they had caused, with the purpose of saying: let’s see, let’s go to the settlement,” López Obrador said at his Thursday press conference.

“But no, in this case it was arrogance, and the senators of the United States congress thought that we were a colony, right? So, it was decided to convert not only that land, but 50,000ha into a protected natural reserve to protect the environment,” he added, referring to the bill US senators introduced to retaliate against what the company called an expropriation.

Vulcan told BNamericas it was aware of what it called the expropriation of the Sac Tun quarry, formerly Calica, and a port.

“The expropriation of our company’s land and port is yet another escalation and a new violation of Mexico’s commitments under North American trade agreements, including the USMCA and other applicable investment agreements,” a company spokesperson said via email, adding that Vulcan intends to defend itself using all available legal avenues.

For their part, the bipartisan group of US senators is promoting legislation that seeks to pressure the Mexican government to reverse the measures.

If enacted, the law would prohibit ships from entering a US port if they had previously used a port, land or infrastructure illegally seized from a US entity by a foreign nation in the Western Hemisphere.