What’s next for Vulcan Materials in Mexico

Vulcan Materials finally received a customs permit last month for its deep-water port at Punta Venado in Playa del Carmen, Quintana Roo, Mexico.

The permit was issued after Mexico delayed it earlier this year, the company says. Vulcan chairman and CEO Tom Hill says the permit had historically been issued every three years.

“We are making progress in our discussions with the government of Mexico,” Hill says.

In discussions between Vulcan and senior Mexican officials, Vulcan says it articulated its openness to supply construction materials for construction of the Mayan Train and other infrastructure projects. Vulcan will also make port capacity available for the transfer of train-related construction materials.

Additionally, Vulcan says it is open to adapting its mine plan for the development and construction of a large-scale ecotourism project – suggested by the Mexican government – on land owned by the company, as long as Vulcan can continue to supply its customers. Development could begin immediately on certain areas of Vulcan land where reserves were already depleted.

Vulcan is also prepared to explore an expansion of the Punta Venado maritime terminal to receive passenger, freight and naval vessels in the coming years.

“While there is more to be done before a final binding agreement can be reached, we are working toward a satisfactory resolution for all those involved that enables us to continue to supply aggregates to our customers,” Hill says.

Ongoing negotiations

Vulcan has been engaged in a NAFTA arbitration with Mexico since 2018. The negotiation centered on Mexico’s rejection of an agreement to unlock a portion of Vulcan’s aggregates reserves in Mexico, and the shutdown of a portion of the company’s quarry operations there.

Vulcan says a hearing took place in July 2021, and a decision is expected in the second half of 2022. Vulcan continues to engage with government officials to pursue an amicable resolution while awaiting final resolution from the NAFTA tribunal.

According to Vulcan, it has quarried limestone legally in Mexico – on Vulcan-owned land – for more than 30 years. Vulcan is the sole owner of four lots of land south of Playa del Carmen that together form its Sac Tun operation, formerly known as Calica.