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Fortuna Silver Mines (NYSE: FSM) (TSX: FVI) is looking to file an appeal to the denial order received earlier this month from SEMARNAT, Mexico’s environment ministry, with respect to the company’s application to extend its environmental impact authorization (EIA) at the San Jose mine.

The San Jose mine, located in Oaxaca, was Mexico’s seventh-biggest silver producer last year, outputting 6.2 million ounces along with nearly 38,000 ounces of gold.

The underground mine, in operations since 2011, is facing the threat of closure following the expiry of its main environmental authorization on October 23, despite Fortuna’s efforts since May to petition SEMARNAT to extend the EIA for another 10 years.

The environment ministry recently issued a statement saying it would work to organize the consultation of nearby Indigenous communities as part of the mine’s requested environmental authorization. Local activists have been denouncing the silver mine for alleged presence of unauthorized construction.

For the moment, the company is operating the San Jose mine under the protection of Mexican courts, and its lenders have also extended the date by which it must obtain a permanent injunction or equivalent protection to February 18, 2022.

In a press release on Friday, Fortuna maintained that it is “fundamentally in compliance with all material aspects of the EIA and is entitled to an extension,” and is continuing to work with authorities to resolve the matter.

Shares of Fortuna Silver Mines were down 1% by noon ET. The Canadian precious metals producer has a market capitalization of C$1.44 billion ($1.14bn).