BLM: Cemex owes more than $25 million in annual payments

Santa Clarita City Councilmembers Laurene Weste, left, and Bob Kellar celebrate as they report on the decision about the Cemex Mine at a press conference held at Santa Clarita City Hall in Valencia in March 2019. Dan Watson/The Signal

Cemex owes more than $25 million to the Bureau of Land Management and, if the payments are not made, the multinational company’s contracts for sand and gravel mining in Soledad Canyon would be void, bureau officials have ruled.

In a pair of decisions handed down Friday by the BLM, addressed to Cemex Inc., bureau officials state that for each of the two Soledad Canyon mining contracts held by the mining giant no actual production has occurred and no annual payments in lieu of production have been made, as required by the contracts. 

Annual “in lieu of production” payments were due on or before the anniversary date of the execution of the contract, city of Santa Clarita officials reported in a news release issued Monday.

To date, Cemex has not paid any such payments in lieu of production.

Phone messages left for Cemex Monday morning were not returned.

The BLM decisions state, “Cemex has a contractual and legal obligation to produce material or to make annual payments in lieu of production… Cemex’s failure to comply with the terms and conditions of producing mineral material or making timely in lieu payments is contrary to the terms of the contract and in violation of federal regulation.” 

According to city officials, if Cemex fails to respond to the notice within 30 days, “BLM will consider CEMEX to be in breach of contract, and the contract will be cancelled or terminated for default.”

“Hearing the words ‘cancelled’ or ‘terminated’ in regard to Cemex is always good news,” Councilman Bob Kellar, a member of the City Council’s Cemex ad hoc committee, was quoted as saying in the city’s news release.

“We will remain vigilant and see how this most recent development plays out, but this is definitely another win, in what has been a two-decades-long battle to prevent mega-mining in our community.”

For the initial 10-year contract, which expired in 2010, BLM states that the total amount owed to the United States in lieu of production payments is $7 million. For the second contract, set to expire on July 31, 2020, BLM asserts that the contract is now in its ninth year, meaning that nine payments in lieu of production are due, totaling $18,972,000. Combined, the BLM is requesting a total of $25,972,000 in payments from Cemex.

“This is another major advancement in ensuring that our beautiful, natural landscape is not ravaged by mega mining,” Councilwoman Laurene Weste, also a member of the city’s Cemex ad hoc committee, was quoted as saying in the same city news release.

”This fight is not officially over, and we are dedicated and committed to seeing this battle to a conclusion. This community has worked for many years with strong leadership to prevent this mega mine from becoming a reality in our valley,” she said.

“We will continue to protect our air and water quality, as well as the health and high quality of life our residents appreciate,” Weste added.

This recent development is the latest in what has been a 20-year-long battle over mining rights in Soledad Canyon. 

The city of Santa Clarita has been fighting to prevent mining in Soledad Canyon since the Cemex contracts were issued by the federal government in 1990. 

The Cemex contracts would have allowed for the mining of 56 million tons of sand and gravel from Soledad Canyon, which would have added up to 1,164 truck trips a day to local roads and freeways. 

Opponents of the mine say this would have caused air quality issues and potential negative impacts to the Santa Clara River, the San Gabriel Mountains National Monument, and wildlife corridors connecting the Angeles National Forest, as well as fish, wildlife and plants in the area.

Friday’s BLM news follows nearly two decades of back-and-forth moves both inside and outside of court, reams of proposed legislation presented to block the mine from starting up, and failed  initiatives presented by state and federal officials to the same end.

In March, city officials expressed joy when, in a much-anticipated decision by the Interior Board of Land Appeals regarding the proposed Cemex sand and gravel mine, federal mediators ruled that the BLM was “affirmed in part, reversed in part, set aside in part, and case remanded.”

City officials were jubilant over the news that Cemex’s mining rights in Soledad Canyon would expire in July 2020.

Some officials cautioned that Cemex could still appeal.

And, on Sept. 26, that’s exactly what happened when the Mexican-based mining giant filed a lawsuit in U.S. District Court.

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