McEwen Mining (NYSE: MUX; TSX: MUX) is facing a lawsuit from the Apitipi Anicinapek Nation (AAN) over the Black Fox project. In its lawsuit, the First Nation is alleging the company breached its impact benefit agreement related to the Black Fox project. McEwen Mining is a gold and silver producer with operations in Nevada, Canada, Mexico and Argentina.
The First Nation launched the lawsuit in Ontario Superior Court on February 10 and claims McEwen Mining failed to meet to its financial commitments and caused environmental harm on the Indigenous community’s traditional territory. The lawsuit says McEwen failed to make yearly compensation payments in the form of shares to the First Nation for over a decade and had allowed tailings leakages that harm fish, wildlife, and the local ecosystem. The First Nation alleges historical and ongoing seepage from the Black Fox mill tailings management facility.
The announcement of the lawsuit comes on the heels of an official statement from McEwen responding to a letter from the First Nation dated February 12 alleging McEwen breached the impact benefit agreement associated with the Fox complex originally signed in 2011 between Brigus Gold and AAN. Since that time, the Fox property has changed ownership twice. First to Primero Mining when it purchased Brigus in 2013 and then in 2017 when McEwen acquired Fox from Primero in a single asset sale.
McEwen’s most recent statement is as follows: “Concerning the environmental allegations, McEwen is fully committed to the protection of the environment at the Stock Mill. We continue to take appropriate steps to protect the environment and comply with laws. We do not believe there is cause for concern about harm to the environment or the public from the operation of the tailings facility. Our tailings facility is operated under an approval issued by the Ontario Ministry of Environment, Conservation and Parks, and is subject to frequent inspections by representatives from a variety of provincial and federal ministries including those responsible for fisheries, natural resources, the environment and mining.”
In defending its record, the company added, “We must adhere to stringent requirements for effluent treatment, including surface and groundwater quality monitoring and biological monitoring, and report results to the MECP. As part of a recent Closure Plan Amendment in the normal course of operations and in response to inspections by provincial authorities, McEwen proposed additional monitoring and continues to work with these authorities to ensure that we are fulfilling our obligations to all our constituents.
McEwen understands that there has been an ongoing dispute concerning the obligation in the IBA to make annual payments of 25,000 Brigus common shares to AAN predating McEwen’s acquisition of Fox. Complicating the conversation is the fact that Brigus ceased to exist after its purchase by Primero in 2013; McEwen believes that Brigus shares and McEwen shares are not interchangeable on a 1-to-1 basis and that we are not responsible for shares that were not delivered by Primero during its ownership of Fox, among other things. We remain open to constructive dialogue with AAN on this issue, and we hope to reach an amicable resolution.”
McEwen also stated before and during the ongoing dispute it worked with AAN to provide the community members and businesses with advantages consistent with the financial participation and business terms of the IBA. The company said it provided CDN$20 million in direct and indirect benefits since 2017. McEwen said the company paid for an AAN representative to dialogue with the community. The representative was present at Fox up to five days per week and had a workspace in the environment office. McEwen’s statement said that this AAN representative has “not appeared at Fox for more than one year.”
The company further stated, “Given there seem to be significant misunderstandings about environmental matters and transparency, we believe it would be highly beneficial to have an AAN representative present at Fox on a daily basis.”
More information is posted on www.McEwenMining.com.
