The Chamber of Deputies of Mexico has approved, in general, different amendments to the Mining Law Proposed by The President of Mexico, Andres Manuel Lopez Obradorin terms of exploration, exploitation and use of lithium. López Obrador said he expected Parliament to approve this Monday or Tuesday the legislative reform of the law that aims to nationalize lithium, hours after the Chamber of Deputies did not obtain the necessary votes to approve the electricity reform. Mexico’s president has accused opposition lawmakers of being ‘traitors to the country’ for preventing Congress from giving the green light to the law, which aimed to strengthen the public electricity company at the expense of private companies .
Lithium as a national heritage
The amendments to the mining law were approved by 298 votes for, none against and 197 abstentions. Deputies from the National Regeneration Movement (Morena), Labor (PT) and Green Ecologist of Mexico (PVEM) parties voted in favour, while abstentions came from deputies from the “Va por México” alliance, made up of the National Action (PAN), Institutional Revolutionary (PRI) and Democratic Revolution (PRD). This opposition bloc abandoned the legislative discussion and announced that it would abstain.
President López Obrador’s initiative declares the exploration, exploitation and use of lithium to be of public utility. The reform proposal of Article 5 of the law proposes the creation of a public body that manages and controls the economic value chains of lithium. Among other points, the mining law indicates that “those in which there are lithium deposits will be considered as mining reserves”, that “it is recognized that Lithium is the nation’s heritage and its exploration, exploitation and use are reserved for the exclusive benefit of the Mexican people.“.
The initiative proposed by López Obrador aims to ensure that there are no concessions or contracts for the exploitation of lithium and that this is the sole responsibility of the State. This has sparked controversy because the Chinese-owned company Bacanora Lithium now has a concession in Sonora, in northwestern Mexico, which would allow it to extract 35,000 tonnes of lithium carbonate per year. This is considered one of the largest mineral deposits in the world, at 8.8 million tonnes equivalent with reserves that would last 250 years.
As he announced last week in case of rejection of the electricity reform, López Obrador asked Congress on Monday to approve the lithium nationalization project. “The deputies who are traitors to the fatherland have not even realized what they have done, they do not know the importance of lithium and the ambition it arouses among the great powers”said the Mexican president, commenting on Sunday’s legislative vote, which left the electricity reform truncated.
“We reserve the possibility of including lithium in the mining law, because it is a strategic mineral for future development, to replace oil: It will not be possible to modernize the industry without lithium“, warned López Obrador in his usual morning conference. The major car manufacturers “are moving towards electric cars which require lithium and the price is increasing more and more, in ten years the price of lithium has increased tenfold on the world market”, assured the leader of the left.
On February 2, López Obrador announced the creation of a public company to exploit lithium. In the Rocky Mountains of the center of the country and the desert northwest of Mexican territory, there are 1.7 million tons of estimated lithium mining reserves, which place Mexico among the ten countries with the largest reserves of this mineral.
The electrical reform, rejected
A few hours before the approval of this law, which must pass by the Senate, the electrical reform also proposed by López Obrador had been rejected. “An act of treason of Mexico was committed by a group of lawmakerswho instead of defending the interests of the people or the nation, instead of defending what is public, have become fervent defenders of foreign companies dedicated to prosperity, theft and these deputies supported the looters“, said the annoyed Mexican president, who quoted French philosopher and feminist activist Simone de Beauvoir, saying that “The oppressor would not be so strong if he had no accomplices among the oppressed themselves”.
The reform proposed to delimit the liberalization of the electricity market to reverse the “disappearance of public energy companies” which had caused the constitutional reform of 2013, according to the Mexican president. The new project proposed that at least 54% of the energy was managed by the Federal Electricity Commission – compared to the 38% it currently manages and 62% in private and foreign hands.
The opposition rejected the reform believing that it would lead to an increase in polluting gas emissions and higher electricity prices, which López Obrador himself has repeatedly denied. The other main opponents of the reform were the United States and Canada, which argued that the decision could harm their investments, and even Spain, due to the presence in Mexico of the private company Iberdrola.