MAC: Mines and Communities

Shooting up with Mexican Coal

Published by MAC on 2012-11-25
Source: Raw Story (2012-11-17)

It's a criminal fix

Now here's an unusual spin on the notion of  coal as a form of narcotic, sold at profit and burned to satisfy our global addiction to carbon-fired electricity.

According to Australia's Herald Sun newspaper,  Mexican drugs' cartels own and operate a number of mines along the coal-rich US-Mexican border.

"The cartels reap immense returns from the sale of the solid fossil fuel to state-owned companies, often obtaining profits as high as 30 times their initial investment, while also obtaining an effective channel for money laundering." [Mining.com 19 November 2012].

In particular, the "Zetas" - founded by renegade members of the Mexican special forces and renowned for "some of the most heinous acts of violence during regional drug wars - are "believed by experts to be the first cartel to make a foray into the mining sector."

Heriberto Lazcano, a Zetas head honcho, was shot dead during a gun battle with the authorities in the coal mining town of Progreso on October 7th.  He allegedly "owned his own coal pit in the region, while the cartel has reportedly long engaged in illegal coal mining in the mineral-rich state of Coahuila."

Says the Herald Sun: "The entry of Mexico's drug cartels into the mining sector has a nearby precedent in Colombia, where local drug barons often took up stakes in gold and coal mines".

The cartels also use their mining ventures as a cover for laundering more criminal proceeds, thus "avail[ing] themselves of a convenient means of legitimizing and diversifying their earnings".

The November issue of CTS Centinale - a monthly security newsletter from the Combatting Terorrism Center at West Point (USA) - points out that the Zetas aren't a cartel in the conventional sense.

It claims that, as well as making money by trafficking narcotics from Guatemala to the U.S. border, they also " engage in extortion, kidnapping and smuggling...

"After a split with the Gulf Cartel in 2010, the Zetas applied their military training and loose structure to create an entire nationwide criminal enterprise. The formula worked regardless of the fact that few Zetas today have any military training, [and] because of who held the whole structure together: drug boss Heriberto "Z-3″ Lazcano".

But the killing of Lazano doesn't mean that the exploitation of coal or other noxious substances has now come to an end, says CTW Centinale, since the Zetas "are more like a decentralized network of criminal cells..."

Mexico's Zetas Drug Cartel Strikes Gold in the Coal Business

Raw Story

17 November 2012

They may be known for flashy cars and state of the art weaponry, but Mexican druglords have found an earthy new source of wealth: dirty old coal.

They are mining it themselves in a coal-rich area along the US border or buying it from small mine operators, then reselling it to a state-owned company at fabulous margins that can see them make a profit 30 times greater than their initial investment.

Along the way, besides the earth's black bounty, the drug lords are seeking to reap credibility as legitimate business people.

First word of the Zetas drug cartel's presence in mining-heavy Coahuila state came in October from a former governor, Humberto Moreira, who blamed the notoriously violent group for his son's death.

The Mexican Mining Association says Mexico produces 15 million tonnes of coal a year, worth $3.8 billion. About 95 percent of it comes from Coahuila.

Reforma newspaper says the Zetas produce or buy 10,000 tonnes of coal a week. Selling it at their inflated prices, that means yearly revenue of $22 million to $25 million.

The Zetas were created for former Mexican military special forces operatives who worked for the Gulf cartel. But they broke away from that group to control lucrative drug trafficking routes to the United States and engage in other crimes such as extortion, people trafficking and fuel theft.

"The Zetas are the first Mexican cartel to diversify from drugs into other areas", said Tomas Borges, author of a book on the cartels.

Zetas leader Heriberto Lazcano was shot and killed by authorities October 7 in the coal mining town of Progreso. His body was later stolen by armed men. Moreira says the drug lord had his own coal pit in the region.

But the Zetas presence is not new. Raul Vera, bishop of Coahuila's capital Saltillo, said drug traffickers have been digging coal for years and doing it in areas where it is illegal.

"It is an open secret that drug traffickers are infiltrating the coal mines. But since Moreira spoke out, we have seen police and military around and we know they arrested several people," a coal industry businessman in Agujita said on condition of anonymity.

Highway 57 heading north to the United States runs through a dusty black area where piles of coal from small, precariously operated mines dot the landscape. Fatal accidents are common. Trucks loaded with coal are stopped at checkpoints manned by soldiers looking for drug traffickers and drug shipments.

Since the Zetas discovered coal, violence has been on the rise, especially in a town of 150,000 called Piedras Negras, or black stones. "For drug cartels, diversification is almost a natural evolution", said Antonio Mazzitelli of the United Nations Office on Drugs and Crime. In Colombia, for instance, traffickers infiltrated gold and coal mines and also dealt in oil.

"Corruption is their main tool for doing business, and also violence, if necessary," Mazzitelli said

"Legitimate businesses help cartels launder money and bring in extra revenue", added Eduardo Salcedo, a Colombian who co-authored a book on how drug cartels have reshaped Colombia, Guatemala and Mexico.

"Such business activities allow them not just to bring in more money; but above all gain social and political legitimacy", Salcedo said. Traffickers want to be able to "legalize their leaders and activities and join the formal economy, and be able to operate in society in a more relaxed way," he explained.

But that quiet end does not always involve peaceful means. "Traffickers sometimes kidnap, mug or even kill miners and their bosses, or force them into business-sharing agreements", said Salcedo.

In Coahuila, some companies without mines or employees have contracts with local coal industry promoter Prodemi, according to a researcher from a local organization founded by relatives of miners who died in a 2006 accident that claimed 65 lives.

"There are mines that have a capacity for 30,000 tonnes but have contracts for 150,000. What they are selling is not what they are producing", added the researcher, who requested anonymity.

"They are buying it from a third party and that is where all these people come in, be they Zetas or not, legal or not, clandestine or not."

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