Potash mine in Amazon gets state license questioned by federal authorities

The Brazilian state of Amazonas has granted a license for Canadian firm Brazil Potash Corp to build Latin America's largest fertilizer mine in the Amazon rainforest, but federal prosecutors said on Tuesday it was not legally acceptable. Governor Wilson Lima on Monday announced that the installation license was issued by his state's environmental protection agency IPAAM, and that the company plans to invest 13 billion reais ($2.6 billion) to build the mine in Autazes, 75 miles (120 km) southeast of state capital Manaus.

The Brazilian state of Amazonas has granted a license for Canadian firm Brazil Potash Corp to build Latin America's largest fertilizer mine in the Amazon rainforest, but federal prosecutors said on Tuesday it was not legally acceptable.

Governor Wilson Lima on Monday announced that the installation license was issued by his state's environmental protection agency IPAAM, and that the company plans to invest 13 billion reais ($2.6 billion) to build the mine in Autazes, 75 miles (120 km) southeast of state capital Manaus. The project, which could reduce Brazilian agriculture's 90% dependence on imported potash, has been held up for years due to opposition from Indigenous Mura people who say they have not been consulted about the use of their ancestral lands.

Federal authorities say the license should come from Brazil's environmental protection agency IBAMA and not from the local agency in the state, whose government backs the project that it says will bring investment and create thousands of jobs. The federal prosecutors office in Manaus said in a statement that it considers the license granted by IPAAM "to be irregular and will adopt the appropriate measures."

"The license violates constitutional rights, international standards and also the rights of Indigenous peoples," it said. In September, a federal judge in Manaus reiterated her 2016 decision to suspend the project until the Mura were properly consulted. She also ruled that a license must come from the federal environmental agency and not the state's agency.

A federal appeals court later overturned an injunction suspending Potash Corp's state license, arguing that IPAAM could issue the permit because there is no officially recognized Indigenous territory in the area planned for the mine. Mura leaders say the mine overlaps their ancestral lands and seek their recognition as protected reservation land. But the demarcation process is pending by Indigenous affairs agency Funai, and divisions have emerged within the Mura community.

Potash Corp maintains that Mura leaders support the mine. But five Mura communities and the Indigenous Association of Amazonas sent the prosecutors letters seen by Reuters rejecting the governor's announcement.

Brazil Potash is owned by CD Capital with a 34% stake, Sentient with 23% of shares, and Stan Bharti's Forbes & Manhattan Group, a Toronto-based merchant bank that began the project, which now holds 14%, along with other shareholders. ($1 = 5.0042 reais)

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