Mexico Ruling Favors Whales Over Mine : Ecology: Agency rejects $120-million expansion project in Baja California bay. Company will appeal.

Mexican authorities rejected a $120-million salt-mining project that environmentalists say would endanger the California gray whale, but a company official insisted Thursday that the decision will be contested.

The rejection from the National Ecology Institute--Mexico’s equivalent of the Environmental Protection Agency--has pitted ecological authorities against trade officials in a test of Mexico’s commitment to the environment in the face of the current economic crisis.

The project would double operations for the salt exporter that shares the whales’ winter home in a Baja California nature reserve, expanding the mining operation to the shore of San Ignacio Lagoon. The lagoon is the most pristine of the four main bays where the whales breed and give birth before swimming back to their summer home in Alaska.

The recovery of the California gray whale population is considered one of the major conservation triumphs of this century, and less than a year ago the gray whale was removed from the endangered species list.

The mining project’s effect on the whales has not been determined, but marine biologists warn that it could be devastating.

On the other hand, the expansion would make Mexico the world’s largest salt exporter and generate an estimated $100 million a year in additional revenue for a company that is 51% owned by the cash-strapped Mexican government. Mitsubishi Corp. of Japan is the minority partner.

Commerce Minister Herminio Blanco is ex-officio chairman of Compania Exportadora de Sal, the salt company, and has publicly defended its position that the project will not damage the environment.

In contrast, the ecology institute determined in a 15-point ruling, “The justification for the development is that it will reduce production costs for the product, common salt. Even though that justification seems acceptable from an economic viewpoint, we believe that there are not valid elements to justify the loss of such a large natural area inside a biosphere reserve,” as the nature reserve is known.

Gabriel Quadri, chairman of the institute, said, “We were not only worried about the whales but also their (the company’s) plans to flood 123,000 acres inside a biosphere reserve.” The flooding would be needed to extract salt from ocean water.

On Thursday, the mining company’s operations director, Eduardo Elorduy, said, “We definitely are going to contest the decision. It is our legal right.” The deadline for an appeal was Thursday. Quadri said no reply had been received by Thursday afternoon.

If the company loses the administrative appeal, and Quadri believes it will, it can still take the government to court. Mexican law protects citizens from government actions that affect their interests under a powerful type of injunction called an amparo .

In the past, companies have won amparos against environmental authorities and proceeded with projects. Quadri said he believes his institute’s case against the company is greatly strengthened because the proposed project would be developed inside the 6-million acre Vizcaino Desert Reserve.

Environmentalists also have vowed to support the government’s rejection of the project.

“If the company challenges the decision, we will intervene to strike down the challenge,” said Betty Ferber, international coordinator for the Group of 100, an activist organization that publicized the mining company’s plans. “. . . If they seek an injunction, we will intervene as an affected third party and, finally, take our case to international organizations, including the International Whaling Commission.”

In the past, courts have not allowed environmental activists to participate in such cases because their property rights were not directly affected. “Mexican environmental jurisprudence is not well-developed,” Quadri said.

In commenting on the likelihood that the case will be decided by the courts, Homero Aridjis, president of the Group of 100, said, “Knowing the tradition of corruption in the Mexican judicial system, this is very worrisome.”

The environmental institute found that the proposed project is incompatible with the objectives of conservation inside the reserve and that it threatens 14 plant species and 72 kinds of animals--six of them endangered species.

The 465-page environmental impact statement the company presented concluded that the project’s impact would be negligible.