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Canadian corporate greed on display in Mexico mining dispute

EnvironmentLatin America and the Caribbean

One of the open pits at the Los Filos gold mine near Carrizalillo, Mexico. Photo supplied by the Ejido of Carrizalillo.

As gold prices soar to record levels, the Los Filos gold mine in Mexico, one of the country’s largest, has sat idle since early September after its owner, Vancouver-based Equinox Gold, failed to uphold its agreement with the nearby community of Carrizalillo, a small town of about 3,000 people. Equinox blames the community for the shutdown, but in reality, the company and its executives have no one to blame but themselves.

On September 3, the community assembly of Carrizalillo set up camp outside the mine, which is principally located on their lands, after their representatives tried for months to appeal to company management to correct breaches of their social-cooperation agreement. Instead of receiving a constructive response, they faced disrespect, ridicule, and discrimination from the manager designated to respond to their concerns.

The community first sought resolution through written correspondence and meetings. In a July 31 letter, the community appealed directly to the Los Filos general manager and explained that their efforts to address grievances with the manager assigned to them “always end with incomplete responses or without resolution and with arrogant acts and insults that extend to acts of discrimination and lack of respect.” They requested that the general manager be assigned to them instead. But he was dismissed that very week. Subsequently, communication with and trust in the company began rapidly eroding.

Left with few avenues to resolve their concerns, including a lack of clean water, overpriced medicine, and a dearth of unionized jobs, the community exercised its legal right to stop the mine’s activities on their lands in the hope that this would elicit a more serious response from Equinox. Within a few days of the shutdown, the community assembly rescinded the social-cooperation agreement, requiring a new one to be negotiated.

Banner outside the mine gates where an encampment was set up in September. Image supplied by Amapola.

Equinox Gold’s response: Racist and discriminatory

Equinox Gold’s first response was to paint the people of Carrizalillo as criminals. Next, it took to blaming the community for the company’s own inability—or apparent lack of interest—in a good faith and productive negotiation. The community, they suggested, was just trying to pressure the company for greater benefits.

On September 4, the day after the encampment was set up, the company released a communiqué referring to it as an “illegal road blockade.” Such statements can sometimes be enough to put communities in serious danger of legal persecution or violence. The community was quick to react, denouncing the company for continuing to treat them in an openly hostile manner, and demanding that it retract the statement. It has not.

Since then, the community has faced acts of intimidation, including two unannounced visits by the Guerrero state attorney, accompanied by dozens of heavily armed police officers. During the second of these visits, on September 22, two Equinox Gold vice-presidents met with the state attorney on ejido land (land that is communally owned and its use managed by members of the ejido) inside the mine’s area of operations. In order to operate the mine, Equinox Gold rents land from Carrizalillo, on which the bulk of the mine installations are located. Ejido members condemned their presence as an attempt by the company to provoke a confrontation rather than seek respectful talks.

More recently, the company’s CEO, Christian Milau, has attempted to shrug off responsibility for the shutdown. During the company’s third quarter investors’ conference call on November 9, Milau suggested that the residents of Carrizalillo, who live next to the mine’s massive, cyanide-laden waste piles, are trying to squeeze the company for more benefits. Adding insult to injury, Milau went so far as to claim that the arsenic that has been found in the community’s water is not a problem and that “it’s safe to drink.” That is easy to say from the comfort of his home in Vancouver. Milau admitted that Equinox Gold had stopped payroll to most workers and contractors. In addition to cutting costs, this is presumably part of the company’s strategy to pressure the community to cease their strike.

Late last week, the community agreed to lift its encampment to advance talks, but emphasized that the mine would remain closed while negotiations are ongoing. Meanwhile, the company announced on Monday, erroneously, that it had regained access to the mine and would once again ramp up operations. This, however, cannot be true given that the community continues to keep watch over the mine gates to prevent such a restart, limiting access during the shutdown to personnel responsible for safety and security measures. Equinox Gold’s misrepresentation of the situation has only provoked further mistrust. It also heightens the potential for confrontation as the company, jumping the gun, begins calling back workers and contractors before resolving the conflict. The company was obliged to issue another press release on Friday stating that the mine is shut down.

More than a decade of devastation and struggle

When Equinox acquired the Los Filos mine this past March, it also assumed responsibility for the social-cooperation agreement between the community and the mine’s former owner, Leagold Mining. Signed in 2019, the six-year agreement covers economic benefits, such as jobs and scholarships, as well as provisions to alleviate serious impacts upon the community’s water and health—impacts that have been felt since the mine began operations more than ten years ago.

The community’s social-cooperation agreement, and its accompanying land-use agreement, were hard-won. In 2007, when the community learned that Canadian giant Goldcorp (since merged to form part of a US company called Newmont) had illegally purchased collective lands, they shut down the mine for 83 days to achieve a better land-use agreement. In April 2014, as talks to renew their agreements with Goldcorp reached an impasse, they held a 33-day strike. This time, the mine has been stopped for almost 80 days.

Carrizalillo is roughly half a kilometre from the Los Filos mine’s massive heap leach pad, onto which Equinox sprays a cyanide solution to extract precious metals from crushed ore. Since the mine went into operation in 2008, the community’s water supplies have been depleted and contaminated by arsenic and other heavy metals. Families in the community report spending upwards of $6,300 CAD a year on bottled water for drinking and bathing.

A community health study conducted in Carrizalillo between 2012 and 2014 documented a marked increase in health problems among the local population believed to be the result of constant exposure to arsenic and heavy-metal-laden dust from the mine. Eye irritation, skin conditions, respiratory troubles, premature births, and birth deformations, among other illnesses, are prevalent among the population. The social-cooperation agreement was set up to alleviate some of the residents’ sky-high medical costs, but under Equinox’s leadership, medicines arrived months late and were priced well above market rates. The community began to suspect mismanagement of funds.

During the last nine years, the community has also experienced significant increases in violence and extortion, a forced displacement of half the community in 2015, and the murders of an estimated 55 community members as of 2019. Such extreme violence has also been reported in connection with Toronto-based Torex Gold’s mining operation about 45 kilometres north of Los Filos in Guerrero state, as well as others elsewhere in the country, as industrial mines in Mexico have become targets for extortion by organized crime, often in collusion with state authorities.

The Los Filos heap leach pads with Carrizalillo in the background. Photo supplied by the Ejido of Carrizalillo.

Carrizalillo’s losses: A lesson to others

Equinox Gold’s refusal to accept responsibility for its actions is not uncommon in the mining industry. Mining executives love to talk ad nauseum about jobs, benefits, and social responsibility, but in fact, companies are rarely held to account for the human and environmental impacts of their operations.

But for the many communities threatened by Mexico’s more than 25,000 mining concessions, the devastation and ongoing deception taking place in Carrizalillo speaks volumes. REMA, a Mexican network of persons affected by mining, has members around the country and regularly shares information about the health harms, water contamination, and escalating violence in Carrizalillo—an eye-opening warning to others regarding the kinds of impacts which they, too, may suffer should a mine be allowed to gain a foothold on their territory.

High gold prices, policies favouring continued mining industry expansion in Mexico, and the tremendous indifference of Canadian authorities mean that conflicts like this one will continue to proliferate. However, efforts by organizations and communities to share and disseminate their struggles and experiences as widely as possible can help other communities to coordinate and fortify their own resistance strategies. In this regard, Equinox Gold’s intransigence and arrogance toward Carrizalillo is only supplying more evidence to fuel this fight.

Jen Moore is an Associate Fellow with the Institute for Policy Studies and former Latin America Program Coordinator at MiningWatch Canada.

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