Mining, Megaprojects, and Metrosexuals in Sonora

Tom Barry

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Minera María, open-pit copper mine owned by Grupo Frisco in upper Sonora River basin not far from U.S. border and near Cananea / Photo credit: Soy Cobre.

NOTE: This article is the thirteenth in a series by the CIP TransBorder Project that examines the water crisis on the U.S.-Mexico border.

“Lo metrosexuales nos ha ganado.” (“The metrosexual culture has beaten us.”) –Sonoran Mining Association (AMSAC) president Joaquin Rojo de la Vega Ulloa, 2011

Public officials in Mexico routinely boast of the megaprojects undertaken during their administrations. Presidents, state governors, and mayors assert that it was their leadership that brought major infrastructure projects to Mexican communities, thereby boosting social well-being and economic growth.

The operating assumption is that the bigger the megaproject, the better Mexico is. Since the 1930s this megaproject logic has served as a driving force in the country’s development plans.

To some extent, the political economy of megaprojects can be found the world over. But in few other countries do public officials so unabashedly brandish the term megaproject (megaproyecto) to promote their own political legacies as in Mexico. Politics and megaproyectos are inextricably linked – regarded as a political necessity because these construction megaprojects provide jobs to constituents and government revenues to the allies, friends, and families of politicians in the business community.

Rarely do the announcement of the initiation of new megaprojects preceded by any cost-benefit evaluations or even rigorous assessments of need for the projects or of their budgets.

Dams and the building of tourism centers (such as Cancún or Los Cabos) have long been among some of the most favored type of megaprojects in Mexico.

In the case of Sonora, Governor Guillermo Padrés points to the water megaprojects of Sonora SI (dams and aqueducts) and the natural gas pipeline from the U.S. border as among his top accomplishments.

Never, however, do Mexican presidents or governors refer to the major mining operations that are initiated or expanded on their watch as part of their megaproject legacy – even though most of the mining projects depend on the close cooperation of the government through the provision of water, roads, subsidies, and technical assistance.

However, measured by most any standard – quantity of investment, associated infrastructure, contracts and subcontracts, and land and natural resources affected – mining projects are certainly megaproyectos.

Conflicting Narratives about Mining’s Impact and Problems

The larger mines generally involve displacement of existing communities and the creation of company towns. In Sonora, Cananea and Nacozari de Cananea (copper mining by Grupo México) are prime examples. To the east, across the Sierra Madre Occidental in Chihuahua, the Bismark zinc mine owned by Industrías Peñoles sits next to the company-owned town of Bismark where the mineworkers and service staff live not far from the U.S.-Mexico border.

Nongovernmental organizations involved in environmental protection and indigenous issues point to mines as among Mexico’s most socially and environmentally destructive megaprojects. They also note that economic benefits are captured almost exclusively the transnational mining corporations, including Mexico-based companies like Grupo México.

“Mining is the megaproject which has cost the most lives in [workplace and environmental] accidents overall the world,” wrote Gustavo Castro Solo of the Network of Communities Impacted by Mining (REMA). Furthermore, “Mining is the megaproject that consumes the most energy and water, and is the largest cause of environmental contamination.” Mining projects involve invariably involve corruption, the loss of indigenous cultures, community divisions, according to REMA.[i]

A disconnect between the huge social and environmental impact of the mining boom and the attention of government to those impacts. Both the federal and state governments – through agencies associated with the ministries of economy – closely collaborate with the mining industry in providing easy access to land, water, and rural communities.

This disjuncture is readily evident when listening to the prevailing narrative about the mining industry as told by the mining industry and the state’s Direccíon General de Minería, a subagency of the Secretary of Economy’s office in Hermosillo.

Over the past decade, as the mining industry’s presence in Sonora has more the doubled, the social and environmental impacts of mining have grown exponentially – as evident in the rising complaints registered by mineworkers, environmentalists, university researchers, and affected communities. However, it wasn’t until the massive spill of toxic water into the Sonora River basin by Grupo México’s Buenavista copper mine in Cananea that this gap between the official story and the reality of the costs of this boom in mining exploration and extraction.

Hermosillo-based Minera Cascabel working with Mag Silver of Canada organized forces to counter anti-mining majority in Ejido Benito Juárez, located on the eastern edge of the Sierra Madre Occidental. / Photo by Tom Barry

The Sonora Miners Association (AMSAC), which includes the director of the state government’s mining office on its board of directors, includes most of the major mining companies in Sonora, including the big three of Mexican mining companies: Grupo México, Grupo Frisco, and Industrías Peñoles. The membership of the association also includes less well-known mining firms such as the gold-mining firm Agnico Eagle and Minera Cascabel. In most cases, the Sonora-based mining firms are fronts for foreign mining corporations – almost all of which are Canadian.[ii]

Such is the case of Minera Cascabel. The exploration firm has functioned as a front for the Canadian mining firm Mag Silver. The two companies have come under sharp public scrutiny in Chihuahua after the October 2012 murders by sicarios (hired killers) of two anti-mining activists. The married couple belonged to the organization of small farmers and ranchers El Barzón and led the community’s opposition to the mining operations in the Benito Juárez Ejido, which is located in the northwestern part of the state. “From the beginning, we have known who were involved in the murders. The mining company (Mag Silver and its associate El Cascabel) used their funds to buy sicarios and killed them,” according the murdered couple’s family.[i]

The Sonora Mining Association also maintains close relations with the state government. The chief of the Dirección General de Minería is a member of the association. And one of the most powerfully connected members of Sonora’s business class, Miquel Ángel Áyala Guerrero, serves as AMSAC liaison with state government. Ángel Áyala is owner of couple of construction companies including Terracerías Construcciones, y Vías Férreas (Tecovifesa), which is invested in the expansion of Grupo México’s Buenavista copper mine in Cananea.

Angered by the assassination the ejido’s anti-mining figures, Ismael Solorio and Manuela Solís, and the failure of Minera Cascabel and Mag Silver to remove mining chemicals and samples farther from town and comply with environmental regulations, members of Ejido Benito Juárez together with the agrarian organization El Barzón dump materials along highway. / Photo by Tom Barry

Among other work, Tecovifesa builds the dams and terraces for mine tailings – including the one that failed so spectacularly on August 6, 2014, contaminating the Sonora River.[ii] Tecovifesa is also part of the consortium of companies, Exploraciones Mineras del Desierto, which has the state contract to build the controversial (and nearly complete) Novillo-Hermosillo aqueduct.[iii] Ángel Ávila’s company has received numerous state contracts, including for construction related to mine maintenance.[iv]

Facts and Fantasy from Sonora’s Mining Association

A 2011 public letter by AMSAC’s president Joaquin Rojo de la Vega Ulloa illustrates the perspective of the mining industry with respect to workers, youth, environment, water use, and security.

In his 2011 public letter and speech, AMSAC president boasted, “Sonora is the top mining state in Mexico, and [in Sonora] mining far surpasses any other industry” in the benefits it provides to the state population and economy.[i] With respect to the foreign exchange (mostly dollars) from exports by the state’s mining industry, this assertion is certainly true with respect to any other nonagricultural industry, such as manufacturing.

The assertions of AMSAC’s president about how the mining industry benefits Sonora mirror the laudatory declarations by the state government’s own mining agency, Dirección General de Minería (See “Mining Boosterism in Sonora”).

Although the figures cited by AMSAC and the Dirección General de Minería likely reflect the industry’s production and sales, there is a fanciful quality to assertions about the industry’s social and environmental benefits, as evident in the dubious assertions by AMSAC’s president, such as the following:

* “We are the industry with the most certifications as a clean industry.” Which “means that government agencies recognize us as agencies that don’t contaminate and which conserve the environment – and all of this documented.”

* “More than any other industry, we take care of water resources.”

* “We don’t contaminate the water, as our detractors assert.”

* “If our standards for responsibly caring for water were applied to the agricultural or cattle industries, they couldn’t even operate nor meet our [environmental care] requirements.”

* The mining industry plants and conserves more trees than other industries. Our tree nurseries plant and conserve millions of trees. We aren’t killers of trees, we are reforesters.”

“Only 30 percent of our territory has been explored – and 70% remains unknown.”

Los Mulatos gold mine in the Sierra Madre Occidental of Sonora / Alamos Gold Inc.

AMSAC’s president Rojo de la Vega did, however, acknowledge that “all isn’t beautiful and right” with the industry. One major problem, he underscored, was that “young people today don’t want to work in the mining industry because “they only want to work in an office, to wear suits, to stay out of the bad weather, and to eat and sleep when they choose.”

Summing up this major challenge for the mining industry, Rojo de la Vega regretfully observed: “Lo metrosexuales nos ha ganado.” (“The metrosexual culture has beaten us.”) What is more, speaking of the industry’s bad reputation, he noted that nowadays “comfort prevails over personal and professional growth.”

Many Sonorans, especially after the August 2014 mining disaster in the Sonora River Valley, might also take issue with his statement: “We are an industry oriented to the environment; we are an industry of labor peace; we are an industry of open and honest communication.”

The mining association president gave the example of the copper mines in Cananea as a model for what could occur across the state. Mining in Cananea is “generating an flood of economic wealth that is shaking treasure boxes the world over,” waxed Rojo in his paean to the glories of mining in Sonora.

Closing his address, AMSAC’s president underscored the importance of the Cananea model, pointing out that the “transnationals are there” in Cananea but only the “most intelligent” Mexican firms. Yet, in the mining sector, “there is opportunity for everyone,” he concluded.

AMSAC president Joaquin Rojo de la Vega Ulloa speaking at 2011 AMSAC meeting. /Mundo Minero

The only part of the 2011 discourse by AMSAC’s Rojo de la Vega that attracted national press attention was his observation about security. Yet here, too, the reality of mining in Mexico and the official story often don’t correspond to what is readily apparent to those living in mining regions, particularly the most remote mines in the Sierra Madres.

There exists no single truth about the security of mining megaprojects in Mexico. There are at least several different ways to view the relationship between the mining sector and organized crime.

As is readily observable, most mining operations are highly controlled enclaves to which there is no public entry. Guards stand at the ready at all the entrances to the mines, such as Grupo México’s La Caridad mine in Nacozari, even though the mines operate on public land and use public water supplies. It might be said that in Mexico there are no other businesses that operate within such tightly secured perimeters.

Mina María, copper mine in Cananea operated by Grupo Frisco, a Carlos Slim-owned corporation. /Minería Frisco.

Throughout the Sierra Madres, like most centers of mining in Mexico, mining companies often maintain collaborative relations with organized crime. In some states, organized crime organizations own or control all extractive industries. A report by InSight Crime, a Washington, DC organization that tracks organized crime in the Americas, reported: “Criminal organizations now control the right to mine in at least five Mexican states, according to those working in the sector, in another example of illegal groups expanding into resource exploitation in areas where state presence is weak.” The states cited with proven links between the mining industry and organized crime included Tamaulipas, Chihuahua, Guerrero, Morelos, and Michoacán.[i]

AMSAC’s Rojo de la Vega told a different story. According to his narrative, the mining industry is under assault by organized crime and the government has not provided adequate security for mining operations, especially for the transportation of precious metals. As a result, the mining industry in Sonora suffered a 15% increase in cost of doing business.

Some of those costs, explained the mining association president, came from the purchasing and operation of security cameras. But most costly, he said, has been the creation of private security forces. “We have experienced the need to create our own paramilitary forces.”

As long as we don’t have tranquility and the rule of law, said the AMSAC president, “We have had to create our own systems of security.” Neither the federal or state governments have made information about the extent of these mining-related paramilitary forces or about their purview, weaponry, or violent incidents.[ii]

Yet another perspective comes from mining sector expert Miguel Valencia at Monterrey Technical School, who has observed that profits from mining in Mexico are so high that any problems related to crime and violence don’t detract from the incentives of capturing so much wealth. “It is such a profitable business that although crime may cost the companies some money and they have to pay for more security, the flow of investments will continue,” he said.[iii]

FOOTNOTES:

[i] “Control Narcotráfico Minas en 5 Estados,” 24 Horas, Aug. 16, 2013, at: http://www.24-horas.mx/controla-narcotrafico-minas-en-cinco-estados/; “Mexican Organized Crime Controls Mining in Five States,” InSight Crime, August 18, 2013, at: http://www.insightcrime.org/news-briefs/mexico-organized-crime-controls-mining-in-five-states

[ii] Arturo Vega, “Ahora narco va por oro y plata; mineras arman grupos,”

Excélsior, May 1, 2012.

[iii] Blanca Estela Botello, “Irregular, 30% de mineras,” Crónica.com, May 20, 2013, at http://www.cronica.com.mx/notas/2013/754413.html

[i] Carta del presidente at: http://amsac.com.mx/cartapresidente.htm See his 2011 speech to the annual AMSAC meeting at: http://youtu.be/daRFWgLY_Hk

[i] “Deudos de Barzonistas asesinados denucian el pacto del gobierno con el narco,” La Crónica de Chihuhua, Oct. 22, 2014, at: http://www.cronicadechihuahua.com/Deudos-de-barzonistas-asesinados,31651.html

[ii] La Jornada, Sept. 12, 2014, at: http://www.jornada.unam.mx/2014/09/12/politica/003n1pol

[iii] Sonora SI, “Curículum de la empresa,” at http://www.sonorasi.mx/index.php?option=com_content&view=article&id=253&Itemid=145

[iv] Sonora SI, “Fondo de Operación de Obras,” at: http://www.sonorasi.mx/index.php?option=com_content&view=article&id=256&Itemid=145

[i] Gustavo Castro Soto, “La minería y la Resistencia en México,” Jan. 13, 2013, at: http://www.cronicadechihuahua.com/Deudos-de-barzonistas-asesinados,31651.html

[ii] AMSAC, “Directorio de Miembros,” at: http://amsac.com.mx/dir_miem.htm

All articles in this 13-part series:

1. The Yaqui Water War

https://www.americas.org/archives/13463

2. Sonora and Arizona’s Uncertain Water Futures

https://www.americas.org/archives/13485

3. The Illusions of the New Sonora

https://www.americas.org/archives/13852

4. Sonora Launches Controversial Megaprojects in Response to Water Crisis

https://www.americas.org/archives/13854

5. Origins and Disappearance of the Yaqui River

https://www.americas.org/archives/13892