President López Obrador said Thursday that the government would offer 6.5 billion pesos (US $389.7 million) to United States construction aggregates company Vulcan Materials for its property on the Caribbean coast of Quintana Roo.
Speaking at his morning press conference, López Obrador said that Mexico’s ambassador to the United States, Esteban Moctezuma, would make a formal offer to the Alabama-based company, which in March denounced the “illegal” takeover and occupation of its Riviera Maya marine terminal by federal and state security forces.
He said that the Ministry of Finance had appraised the company’s 2,400-hectare property at 6.5 billion pesos. Vulcan operated a limestone quarry on the site near Playa del Carmen for about 30 years, but the current government shut it down last year due to alleged environmental damage and the company’s alleged failure to obtain required permits.
On Thursday, López Obrador said that Vulcan “shouldn’t reject the offer we’re making.”
“What is the offer? We’ll buy everything from them, we’ll pay immediately and we’ll turn this part, 2,000 hectares, the largest area of the land, into a natural protected area,” López Obrador said.
“They’ll feel satisfied, they’ll be able to say, ‘we’re contributing to stopping climate change.’ And we’ll declare a natural protected area and we’ll only keep [one part] to carry out an ecotourism development … with a … cruise ship pier,” he said.
The amount the government intends to offer for the Punta Venado property is well below a US $1.9 billion valuation included in papers filed by Vulcan before an international arbitration panel.
According to an Associated Press report, López Obrador “left open a vague threat of seizing the property” if the government’s offer isn’t accepted before he leaves office at the end of September 2024.
“Before I leave [office], this is going to be resolved, one way or another,” he said.
López Obrador also said that as soon as an agreement is reached with Vulcan, the company would have to withdraw complaints it has filed with the International Center for Settlement of Investment Disputes (ICSID), which is part of the World Bank Group. Vulcan filed a complaint with the ICSID in 2018 over a disagreement with the previous federal government.
In addition to shutting down the company’s quarry in May 2022, the federal Environment Ministry prohibited Vulcan from exporting stone that had been used in construction projects in the United States and Mexico. The company is seeking US $1.5 billion in compensation, arguing that it had all the required permits to operate its quarry and export the extracted gravel.
U.S. Secretary of State Antony Blinken said in March that Mexican authorities’ takeover of Vulcan’s marine terminal could have a “chilling effect” on future U.S. investment in Mexico.
The takeover allowed building materials company Cemex to unload cargo at the terminal. Vulcan and Cemex reached an agreement in late March that allowed the latter to use the former’s facility.
If the government’s bid to buy Vulcan’s property succeeds, it could use the marine terminal to bring gravel and cement into the country for the Maya Train railroad project, which is scheduled to start operations in late 2023. The government has imported crushed stone known as ballast from Cuba for the project because there are no local suppliers of the material.
AP reported that ships bringing the stone to Mexico have had to dock in Sisal on the Gulf of Mexico side of the Yucatán Peninsula because the only private freight dock on the Caribbean side capable of receiving such shipments is that owned by Vulcan.
The distance between Sisal and Cuba is considerably longer than that between Punta Venado and the Caribbean island nation. Ballast arriving in Sisal has been trucked some 300 km to some Maya Train construction sites, AP said.
