Mexico’s Newmont optimistic about negotiations on rising mining royalties

By Raul Cortés

MEXICO CITY (Reuters) – Newmont’s Mexico division stated on Wednesday it was seeing an “openness to dialogue” from the Mexican authorities, amid a proposed improve in mining royalties that would probably hamper billions of {dollars} of investments.

WHY IT IS IMPORTANT

The proposed improve in mining royalties might block greater than $6.9 billion in funding over the subsequent two years, based on the nation’s mining chamber, including to challenges affecting the sector, akin to administrative choices previous and potential authorized reforms.

Newmont, a world chief in gold mining, operates the large Penasquito open pit gold mine in Mexico, which produces gold, silver, zinc and lead and processes a mean of 110,000 tonnes of contemporary ore per day.

KEY QUOTES

“There may be quite a lot of curiosity from corporations, quite a lot of dedication to proceed investing in Mexico,” stated Ana Lopez, director of Newmont’s unit in Mexico, whereas emphasizing that “the very best situations in “When it comes to certainty, alternative and collaboration, it is usually vital that we proceed to take action.”

“This commonplace and any commonplace that’s accredited and that applies to us, what we’ve got to do is respect it,” she stated, referring to the controversial price improve proposal.

Lopez additionally welcomed the place taken final week by Mexican President Claudia Sheinbaum, proposing a overview of a authorized reform geared toward banning floor mining, a problem that has additionally sparked considerations within the trade.

CONTEXT

The Mexican authorities’s proposal goals to extend trade royalties, arguing that metallic costs have risen steadily lately.

The mining sector has already been hit by earlier President Andres Manuel Lopez Obrador, who refused to grant new mining concessions, and it faces new challenges below the administration of his successor, Sheinbaum, as authorized reforms might hinder mining operations in Latin America’s second-largest economic system. after Brazil.

(Reporting by Raul Cortés; enhancing by Sandra Maler)