U.S. construction firm Vulcan Materials will defend itself using all available legal means, it said on Tuesday, after Mexico's outgoing president declared land that contains a company-run limestone quarry and port as a nature reserve.
The Alabama-based company has previously said it will also seek more than $1 billion in compensation in an arbitration demand first filed in 2018, as the long-running land dispute also threatened broader business ties with the United States, Mexico's top trade partner.
President Andres Manuel Lopez Obrador, who leaves office next week, has long criticized Vulcan's activities as environmentally damaging, and officials ordered a halt to limestone quarrying by Vulcan's Calica unit two years ago.
"The expropriation of our company-owned land and port is yet another escalation," the company said in a statement released on Tuesday that also defended its environmental track record.
Vulcan has accused the Mexican government of illegally expropriating its assets, demanding more than $1.5 billion in compensation via arbitration mediated by the International Centre for Settlement of Investment Disputes (ICSID).
Lopez Obrador had previously threatened to turn Vulcan's land into a nature reserve if talks to buy the company's property failed. The company quarried limestone in Mexico for over three decades.
According to the president, Mexico had offered up to 7 billion pesos ($362 million) for the land, but Vulcan has called the amount inadequate.
"That figure substantially undervalues our assets, including our reserves," the company said.
The latest move also threatens to strain incoming President Claudia Sheinbaum's relationship with other U.S. companies.
On Tuesday, Vulcan criticized what it described as Mexico's failure to live up to its trade commitments, including the U.S.-Mexico-Canada (USMCA) trade pact, saying it will have a chilling and long-term effect on U.S.-Mexico investment ties.
On Monday, before the decree was published, a group of U.S. senators introduced a bill that would retaliate by effectively rendering the Vulcan port located on Mexico's Caribbean coast unusable for shipping or cruises.
The proposal would prohibit vessels from entering a U.S. port if they had previously used a port, land or infrastructure that had been deemed by the Department of Homeland Security as illegally seized from a U.S. entity by another nation in the Western Hemisphere. A similar bill was introduced by U.S. House of Representatives lawmakers in May.
Lopez Obrador had previously argued that Vulcan's port could be turned in to a dock for cruise ships.
($1 = 19.3428 Mexican pesos)
