Mexico to pay Vulcan Materials less than 1% of arbitration claim
MEXICO CITY - Mexico's government said it will compensate Vulcan Materials less than 1% of the $1.7-billion compensation the US quarrying firm sought in international arbitration over the closure of its Mexican mining operations.
Vulcan launched arbitration, through its Mexican unit Calizas Industriales del Carmen, in 2018 under the North American Free Trade Agreement after authorities shuttered its limestone extraction operations in Quintana Roo state.
Mexico's Economy Ministry said on Monday the arbitration tribunal dismissed almost all of Vulcan's claims, upholding only one related to the January 2018 closure of a single site.
A government source told Reuters the amount would total around $15-million, of the more than $1.7-billion sought by the US company.
Vulcan said on Monday the tribunal found Mexico had violated NAFTA in several respects, but called the financial compensation awarded "insignificant," without disclosing the amount.
Vulcan claimed the case stemmed from Mexico disregarding an agreement meant to free part of its aggregate reserves and ordering "arbitrary closure" of its extraction operations.
Former Mexican President, Andres Manuel Lopez Obrador, had accused Vulcan of causing severe environmental damage, including destruction of cenotes and contamination of underground rivers, by extracting limestone below the water table for decades. Vulcan accused the Mexican government of illegally expropriating its assets.
The affected land was subsequently declared an environmental protection zone.
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