1. Mining in Mexico
PDAC
Toronto; March 2012
E. Luna
Mexico Mining Seminar at PDAC 2012 3/7/12
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2. Mining in Mexico
Access to land
• “Ownership” not really the issue
• Three types of ownership
• Private property
• It can, and should be, bought
• Ejidos
• Only individual parcels can be bought
• Temporary Occupation agreements are widely used
• Agrarian Communities
• Hardest to negotiate
• Get a local (firm or person) to negotiate
• Language barrier
• Different culture
• Lack of knowledge of legal provisions
• Cost of gaining access has increased
• Be prepared to pay top peso
Mexico Mining Seminar at PDAC 2012 3/7/12
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3. Mining in Mexico
Royalties-1
The Economist, Leaders, February 11, 2012
Mexico Mining Seminar at PDAC 2012 3/7/12
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4. Mining in Mexico
Royalties-2
• It has happened in other countries
• Caused by high prices and economic crises
• Can not be a special tax (unconstitutional)
• In principle, we are opposed to it
• Thinking creatively
• Design it as an additional levy on concessions
• Use it as a credit to VAT and/or other taxes
• Triggered by a minimum price
• Apply proceedings directly to Municipalities
• Has to have built-in accountability
• Work with Congressmen is being done
Mexico Mining Seminar at PDAC 2012 3/7/12
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5. Mining in Mexico
Unions
• Having a union is not unavoidable but it is difficult to escape from it
• Three different national Unions
• National leadership weak in every case
• One located in Fresnillo
• One located in Monterrey
• One located in Mexico City-Vancouver
• Relations with Locals should be close and respectful
• They should decide
• Due to current prices, great expectations about salaries and bonuses
• Tug-of-war between local and corporate management
• Agree on a collective contract that is:
• Simple
• Understandable
• With very few different jobs
Mexico Mining Seminar at PDAC 2012 3/7/12
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6. Mining in Mexico
Health and Safety
• Hindrances
• Machismo
• Low formal education
• Lack of training
• Health related
• Drug abuse
• Physical conditions
• Assistances
• Use of families
• Should be written within the Collective Contract
• Training
• Start with staff: Word convinces but example drags
Mexico Mining Seminar at PDAC 2012 3/7/12
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7. Mining in Mexico
Community Relations
• Strongly intertwined with Access to Land
• Patronizing and Paternalism shouldn’t be applied
• Make communities part of the project
• Mess halls
• Garbage collection
• Some freights
• General housekeeping
• Shops
• Sewing -coveralls, vests, etc.
• Poultry farms
• Bakeries
• Set up a team of NATIONALS to handle this matter
• Foster education, formal and informal
• Promote the incorporation of a Community Development Committee.
• Town people
• Company
• Local governments
Mexico Mining Seminar at PDAC 2012 3/7/12
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8. Mining in Mexico
Operations
• It is best to develop or choose a local team of operators
• The only long term solution
• Convenient to support Mexican Earth Sciences Schools
• Students
• Teachers
• Using market oriented provisions
• Reinforce training and development
Mexico Mining Seminar at PDAC 2012 3/7/12
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9. Mining in Mexico
Mining and environmental regulations
• Participation in the writing of regulations is necessary
• Mexican Chamber of Mines
• State and Federal Congressmen
• State Governors
• Support for adequate application and interpretation
• Mexican Chamber of Mines
• Mining Task Force of Can Cham
• Have lawyers and advisors with the right Rolodex
Mexico Mining Seminar at PDAC 2012 3/7/12
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10. Mining in Mexico
Mexico Economic Outlook
• Mexican-and Canadian-economy tangled with US economy
• Outlook is fair
• Government (and citizens!) has to bring about several changes
• Privileges have to diminish
• Unions
• Government monopolies
• Big business
• States have to be financially independent
• With accountability
• As the economy improves, there’ll be better:
• Security
• Labor pool
• Canadian miners in Mexico have helped in curtailing duopoly
Mexico Mining Seminar at PDAC 2012 3/7/12
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