Strange clarification from McEwen Mining, and tone deafness in Canada

After reporting on April 7 that $8.5 million worth of gold concentrate was stolen from his mine in Sinaloa, Mexico, Rob McEwen, CEO of McEwen mining, went on Business News Network and stated blandly that his company had a “good relationship” with a Mexican drug cartel.

The Canadian team at McEwen 

The comments were front page news in Mexico – and still are. They also received coverage in leading English-language outlets around the world. The startling admission was covered by the Associated Press. Outlets that picked up the story included ABC, CNBC, and the Daily Mail.

Doing business the Canadian way: McEwen Mining has a “good relationship” with Mexican cartel

In a recent interview on Business News Network, the CEO of McEwen Mining, Rob McEwen, made some revealing statements as to how his mining company conducts business in Mexico.

Rob McEwen on BNN

Discussing the circumstances surrounding the theft of $8.5 million worth of gold concentrate from his company’s mine in Sinaloa, Mexico, Mr. McEwen said, “The cartels are active down there…Generally, we’ve had a good relationship with them.”

What does it mean for a Canadian mining company to have a “good relationship” with a drug cartel?

In the interview, McEwen said: “If we want to go somewhere, we ask them. And they say ‘No, come back in a couple of weeks when we have finished what we are doing.'"

Passport of former Calderón official recovered from Venezuela drug crash

Norberto Miranda Pérez, 51, a former area director for the Mexican Attorney General’s (PGR) Air Services Directorate (Dirección General de Servicios Aéreos, or “DGSA”), appears to have died when the drug trafficking plane he was piloting crashed in Venezuela.

Cocaine packages recovered from the wreckage

Venezuelan officials say that the crash occurred on April 2. When they went to the crash site in Cañaote, within the Girardot municipality of Cojedes state, they recovered about a ton of cocaine (999 kilos) from the wreckage. All four crew and passengers had died.

Canadian-owned mine knocked off for $8.5 million in gold concentrate

As the CJNG cartel battles it out with local, state, and federal authorities in Jalisco, the criminal element in Sinaloa is pulling off gold heists: on Tuesday, April 7, Canada's McEwen Mining Inc. reported that armed robbers walked off with an estimated 900 kilograms of gold-bearing concentrate, containing approximately 7,000 ounces of gold, from its El Gallo 1 mine in western Mexico.

McEwen's operations in western Mexico (Source: McEwen Mining Inc.)

But this isn’t the same as knocking off Fort Knox.

“No mines in Mexico have gold,” says David Robillard, a Mexico City-based advisor on business and reputational risk. “It takes a lot of technology and work to refine it into what we call gold.”

How much work? Robillard says that to refine the concentrate, otherwise known as “doré”, would require another $100 million investment.

Heating up the plaza in Jalisco

It’s been dubbed the worst attack in recent years against any arm of the Mexican state: on Monday, April 6, at least 15 of Jalisco’s elite State police (Fuerza Única Jalisco) were killed and five others wounded in an ambush. On the same day, the chief of police in Zacoalco de Torres, just west of Lake Chapala, was kidnapped, tortured, and murdered.

Burnt out truck after ambush

The location of the ambush was the Soyatán region, not far from Puerto Vallarta. The police were apparently traveling from Vallarta to the state capital, Guadalajara. None of the attackers died.

This has all of the hallmarks of the Jalisco New Generation Cartel (Cártel de Jalisco Nueva Generación, or CJNG), though the government has not confirmed their participation. The CJNG made a name for itself taking on the ultra-violent Zetas cartel in Jalisco, cleaning up the “plaza” for the dominant Sinaloa Cartel.