Fortuna Silver Mines Inc. is a Canadian precious metals mining company with four operating mines in Argentina, Burkina Faso, Mexico and Peru, and a fifth mine under construction in Côte d'Ivoire
SEMARNAT suggested that it had made a typographical error in the EIA Extension. (Credit: Khusen Rustamov from Pixabay)
Fortuna Silver Mines Inc. (NYSE: FSM) (TSX: FVI) reports that its Mexican subsidiary, Compania Minera Cuzcatlan (“Minera Cuzcatlan”), has received written notice of a resolution (the “SEMARNAT Resolution”) issued by the Secretaria de Medio Ambiente y Recursos Naturales (“SEMARNAT”) which provides that SEMARNAT is re-assessing the 12-year extension (“EIA Extension”) to the environmental impact authorization (“EIA”) for the San Jose Mine, located in Oaxaca, Mexico that it granted to Minera Cuzcatlan in December 2021 (refer to Fortuna news release dated December 20, 2021).
Jorge A. Ganoza, President and CEO, commented, “It is incomprehensible that we find ourselves again having to contest a controversial resolution issued by SEMARNAT. This specific authorization, one of the many under which San Jose operates, was confirmed by the Federal Court last November, with a ruling in our favor against SEMARNAT.” Mr. Ganoza added, “Moreover, under the four years of the current Mexican Administration, the San Jose Mine has been audited annually by the Federal Environmental Attorney’s Office (PROFEPA) as well as the National Water Commission (CONAGUA), and in every single audit, San Jose´s compliance with environmental obligations has been confirmed. Further, during this period, SEMARNAT has issued two multi-year environmental authorizations for the mine and tailings facility.” Mr. Ganoza concluded, “Minera Cuzcatlan is diligently working with the government authorities to resolve this matter and is concurrently pursuing all pertinent legal protection.”
Subsequent to the grant of the EIA Extension on December 16, 2021, SEMARNAT suggested that it had made a typographical error in the EIA Extension and that the correct term was two years (refer to Fortuna news release dated February 4, 2022). Minera Cuzcatlan initiated legal proceedings to challenge and revoke the alleged typographical error, and on November 7, 2022, the Company announced that the Mexican Federal Administrative Court had issued a judgment in favour of the Company and re-confirmed the term of the EIA Extension for the San Jose Mine for a period of 12 years (Refer to Fortuna Q3 2022 MD&A).
On January 2, 2023, Minera Cuzcatlan received the SEMARNAT Resolution which annuls the EIA Extension and requires SEMARNAT to re-assess its decision to extend the EIA by conducting a review of the following two areas of the extension that it previously considered, and subsequently issue a new decision related to the extension of the EIA that:
SEMARNAT did not have authority to grant an extension to the EIA for more than half of the original 12-year term of the EIA
In the EIA Extension, SEMARNAT did not provide sufficient analysis to justify the compliance by the Company of some of its environmental obligations in order for SEMARNAT to grant the extension of the term of the EIA
Management of the Company believes that the SEMARNAT Resolution is unfounded and has no merits, as:
SEMARNAT has the authority under the General Ecological Equilibrium and Environmental Protection Law to grant an extension of the EIA for a period of 12 years
By granting the extension to the EIA in December 2021, SEMARNAT had confirmed that operations at the San Jose Mine are conducted in compliance with all environmental obligations under the EIA which justified the EIA Extension
As a result, Minera Cuzcatlan will pursue all legal protection available to it, which includes initiating legal proceedings against SEMARNAT to contest and revoke the annulment of the EIA, which revocation is appealable by the Company.
Minera Cuzcatlan is in full compliance with all material environmental laws and continues to operate under the terms of the EIA. The Company continues to work with communities from the surrounding area in relation to the mine to enhance and expand the social benefits of the mine in the region. The mine is the single largest employer in the region of Valles Centrales and provides direct employment to over 1,200 people. The Company has sustainable development initiatives with various neighbouring communities and works with over 150 small local enterprises.
Source: Company Press Release