(Gómez Palacio, Durango, México) Excellon Resources has provoked the break-up of negotiations with the Ejido ‘La Sierrita’ and demanded that communal landowners of the Ejido lift their peaceful camp set up outside the La Platosa mine. The Canadian company demanded that the protest end before the company would comply with the contract they have with the landowners, denying the possiblity of building a relationship based on equity and justice with the Ejido, while continuing to violate the landowner's right to land and territory.

Excellon was represented at today's meeting by Canadian Executive Vice-President Brendan Cahill without legal counsel. Mr. Cahill started his new position as Vice-President on Monday of this week. The Ejido was represented by its Negotiating Committee, approved by its governing body, the General Assembly. Also present was the government of Durango represented by Labor Secretary Arturo Yañez Cuellar, Technical Secretary of the Subsecretary of Government for “La Laguna” Eduardo Silva Olivo, General Subsecretary of Government Francisco Arroyo, and Particular Secretary of the Secretary of Durango State Government Emanuel Salvador.

In the meeting, Mr. Cahill told the landowners that in order for the Company to negotiate, the community would have to lift the peaceful camp that their families have maintained outside the La Platosa mine since July 8. The Company, however, was unwilling to resolve the underlying conflict caused by its non-compliance and systematic violation of the contract. On the contrary, Mr. Cahill failed to recognize the landowners’ efforts to advance negotiations with the company since November 2011. Since that time, the Company has toyed with the trust of the Ejido members and treated social development clauses in the contract as favours. These include, among others, provisions that the Ejido will provide transportation and food services, as well as the commitment to build a water treatment plant that would make water pumped out of the mine suitable for agricultural purposes.

The Ejido, on the other hand, tried to meet the Company in the middle. The Ejido offered to work with the company to lift the peaceful protest based on progress in negotiations over the next several days. The Company did not reciprocate with any change in its position.

“At around three in the afternoon, the government asked for two minutes to see if they could talk with Mr. Cahill to be more flexible with the Company's position. After a half an hour, the government returned to the table with Mr. Cahill and seven workers of the mine who are members of the Union lead by Carlos Pavón and who have expressed their opposition to the Ejido,” said Mr. Espinoza, President of the General Assembly of the Ejido La Sierrita. “The government informed the Ejido, without asking for permission, that these seven workers would attend the rest of the negotiation. Mr. Cahill then abruptly told us, as he had said throughout the previous four hours, that he would not negotiate while the blockade continued and stated that if they could not negotiate, the Company would hand over 50% of the rented land and turn over the other 50% of the rented land within the next year.”

Given the presence of uninvited workers and the threatening posture of both the government and the Company, the negotiation committee of the Ejido calmly left the meeting.

“After four hours of negotiations in which we weren't even able to start negotiating the first clause of the contract, the presence of third-party workers and the unwavering stance of the company forced us to leave the facility. Outside, we found another twenty members of the Pavón Union and quickly left the premises,” said Daniel Pacheco, a landowner of the Ejido ‘La Sierrita’.

According to participants, the government supported the company during the process. “During the meeting, the representatives of the Durango state government obviously supported the company. For example, representatives met several times alone with Mr. Cahill throughout the day,” said Mr. Espinoza.

“Mr. Cahill's threat to return 50% of the rented land now and the other 50% within the next year does not appear to have any legal foundation. What is clear is that the Company's violation of the contract is grounds for full rescission of the contract by the Ejido. The Ejido will now analyze this possibility of rescission because they prefer to terminate their relationship with the company rather than continue going through motions with the government's mediation process, which puts foreign investment interests ahead of landowners' rights,” said Alejandra Ancheita, Executive Director of ProDESC and advisor to the Ejido.

The posture of the company puts at risk operations at the La Platosa mine. According to Excellon’s press release of July 9th, its most promising exploration sites are located in the so-called “Rincón de Caído”, which is located on lands rented from the Ejido. “If they return fifty percent of our land tomorrow, we would be happy to ensure that our returned land is from that very area because we know that we can find another company that will not run roughshod over our rights as landowners,” concluded Daniel Pacheco, landowner of the Ejido 'La Sierrita'.

Background

In 2008, after three months of conflict between the company and landowners, a new land rental contract was signed that indicated significant progress. The contract included clauses in which the company committed to contribute to development projects for the Ejido 'La Sierrita' and to improve the quality of community life.

However, in the last four years the company has failed to comply with and has violated the terms of this agreement. Since November 2011, the landowners have tried without succeses to sit down with company representatives and review violations of the land rental contract to resolve the conflict.

“The landowners were forced to start this protest after nearly eight months of attempts at dialogue with Excellon to solve various breaches and violations of the land rental agreement the company signed with us in 2008,” said Daniel Pacheco, a member of Ejido. “It is unfortunate that a company that earned $30 million in gross revenue in one year, much of which was derived from La Platosa mine, cannot meet minimum commitments to support our community's development,” he said.

The General Assembly of the Ejido 'La Sierrita', after exhausting all efforts for dialogue and due to the unwillingness of the company to work with the Ejido, decided to exercise their legitimate right to protest peacefully against the company’s operations at La Platosa mine. The Ejido 'La Sierrita' is confident that the company will comply with the terms of the land rental contract, including among others its obligation to build a water treatment plant for the mine’s wastewater, to grant concessions for the transport of minerals and food services within the mine site, and to make rent payments.

Contacto

• Alejandra Ancheita, ProDESC, (Tel.) +55-5212-2230, +55-5212-2229, +55-3334-6045, alejandra(at)prodesc.org.mx