(Mexico City) On July 8, 2012, over 70 members of the Ejido (communal landowners) 'La Sierrita', in Tlahualilo, Durango, blockaded the La Platosa mine run by Minera Excellon de México S.A. de C.V., subsidiary of Canadian mining company Excellon Resources.

The blockade, which has stopped all operations in the mine, occurred as a result of the company’s failure to resolve its own non-compliance and violations of key clauses of the land rental contract that the two parties signed in 2008.

The Ejido has asked the company to work together to revise the land rental contract since November 2011. Nonetheless, on June 27, company representatives still stated that it would not comply with the clauses in question.

“We’ve been trying to resolve these matters with the company since November of 2011 with little success. The company walked away from a roundtable with the community in January and only sat down with us in June after we attended the company’s shareholder meeting in Canada and informed its shareholders of the company’s misconduct. They have treated us with disdain and have refused to provide us with concrete responses to our proposals,” said, David Espinoza, President of the General Assembly of the Ejido.

Background

In 2008, the Ejido and Excellon Resources, Inc. which is based in Toronto, Canada, signed a land rental contract which allowed the company to use the Ejido's communal land.  Following the signing of this contract, the company immediately started exploiting extensive silver, zinc, and lead reserves in the mine. Mineral extraction from the La Platosa mine has contributed to the vast majority of Excellon's revenue in the last four years.

As part of its contract, the company promised to construct a water treatment plant for the Ejido, hiring preferences in the mine for ejido members and their families, and concessions for transportation of mineral ore and food services in the mine.

“In the last four years, the company has failed to comply with these key clauses. In particular, the company refuses to construct the water treatment plant for our agricultural use of the mine’s excess water. The company has also failed to provide the community with concessions for mineral transport and food services which were promised in the original contract,” said Mr. Espinoza. The company also plainly violated the contract in March of 2011 when it conducted exploration activities on the Ejido's communal land that was not contemplated in the land rental contract.

Since November 2011, the Ejido has repeatedly requested the company's dialogue to revise the contract and invited company representatives to resolve the contract violations. In January of 2012, the company's representatives walked away from a contract revision roundtable with the Ejido. Company representatives only sat down with ejidal leaders in June after Ejido representatives attended the annual shareholders meeting in Canada and after the community filed a complaint with the Organisation of Economic Co-operation and Development (OECD) in Canada regarding the conflict. Four days following the shareholder meeting, Jeremy Wyeth, the CEO of Excellon, resigned from his position.

The community members now willingly wait to resolve this conflict and establish an equal and respectful relationship with Excellon leadership. However, because the company did not meet with the Ejido on July 6 as planned, the Ejido must continue its blockade of company operations until the company seriously agrees to address its non-compliance with the land rental contract.

Contact:

Alejandra Ancheita and Darío Maldonado, ProDESC (Proyecto de Derechos Económicos, Sociales y Culturales en México), (tel) +55-5212-2230, darío(at)prodesc.org.mx