November 26, 2018 / 2:48 PM / 22 days ago

Mexican lawmakers, mining sector to discuss controversial bill

    By Noe Torres and Anthony Esposito
    MEXICO CITY, Nov 26 (Reuters) - Mexican lawmakers will meet
with mining sector leaders this week before seeking Congress's
approval of a bill that analysts have said could hinder mining
operations and that was partly responsible for a massive selloff
in mining shares last week.
    A lawmaker from leftist President-elect Andres Manuel Lopez
Obrador's National Regeneration Movement (MORENA) party
presented the bill in the Senate on Tuesday that would change
mining regulations and require the consent of indigenous
communities before granting mining concessions on their
land.
    The bill is one of a handful up for consideration that would
regulate the mining sector. It also could lead to the
cancellation of mining concessions if firms do not present an
annual report on the social impact of their projects.
    Companies say most of the provisions in the bill are already
included in current laws.
    Morgan Stanley downgraded the stocks of Mexican miners
Industrias Penoles and Grupo Mexico
citing 11 bills and resolutions that could materially affect
mining companies operating in Mexico, dragging their shares to
levels not seen since 2016.
    Lawmakers, mining industry representatives and authorities
of Lopez Obrador's incoming government will meet this week to
discuss the bill presented by MORENA, said Geovanna Bañuelos,
the president of the Senate's mining commission.
    "We want them to be calm. We will not (move forward) without
listening to everyone," Bañuelos, of the leftist Labor Party,
told Reuters in a telephone interview. "We are open to weighing
all arguments."
    Grupo Mexico said it was analyzing the controversial bill,
adding that much of the content in it and the series of other
bills being considered by Congress already is covered by current
regulations.
    "The content of the reforms are not innovative or
disruptive," said Jorge Lazalde, Grupo Mexico's general counsel.
"Many of the things that come in this series of initiatives are
already in the law."
    Lazalde said it was normal for bills to be presented and for
the industry representatives to work with lawmakers to improve
them.
    "As a guild, as an industry, as a sector through the Mining
Chamber, we will work closely with Congress and harmonize points
of view," he said.
    Here is a table of the performance of the main Mexican
mining shares last week:    
                            PRICE     VARIATION
 Industrias Penoles        225.27        -15.6%
 Grupo Mexico               39.35        -10.6%
 Autlan                     13.64         -3.9%
 Minera Frisco               5.00         -3.5%
 
 (Writing by Anthony Esposito
Editing by Bill Trott)
  
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