News from EMNI just hope this news would help CGP from sinking any further, now that the price support seemed to have sunk from the low $0.70 to around $0.60.
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By Silvia Santacruz
Ecuador Mining News
WASHINGTON D.C., November 26th— In a move signaling his administration’s support for large-scale mining, last week President Rafael Correa invited Corriente Resources (TSX:CTQ) to participate in his trade mission to China, where he signed bilateral agreements covering different areas, including mining.
The news of the trade mission arrives one week prior to the convening of Ecuador’s Constituent Assembly, which on November 29th will begin altering the rules for international mining companies operating in the Andean country. The 130-member legislature body will rewrite the constitution and amend the attractive mining law, which was modified only seven years ago abolishing royalties and expensive concession fees to favor foreign investment.
The strategy of seven years ago worked out. Ecuador engaged over 30 international mining companies – mostly Canadian – that are currently exploring for metallic riches. Some firms have successfully discovered major gold and copper deposits, but their achievements are not reflected in their companies’ market capitalization due to uncertainty about Ecuador’s mining future.
President Rafael Correa states that he will welcome mining if firms respect the workers, communities, the state, and the environment. But former MEM minister Alberto Acosta, the presumptive speaker of the Assembly, is a mining critic and says that Ecuador will ban open-pit mining. The result: nervousness in the stock market, and major companies’ indecision to merge with junior firms already in Ecuador until the Assembly debates the mining issue, probably in January 2008. View President Correa YouTube video
Despite Acosta’s threats to prevent large-scale mining from operating in the country, the current minister of mines and petroleum, Galo Chiriboga, has dismissed Acosta’s statements. In an interview with El Comercio newspaper, Chiriboga assured that the government’s position on mining differs from Acosta’s. Read El Comercio article
In addition to Chiriboga’s clarification, there are more positive signals for the mining industry in Ecuador. Last week President Correa invited Corriente Resources, the firm that owns the copper-rich Mirador project, to participate in his trip to China, where he signed bilateral agreements covering different areas, including mining.
“We continue to see strong signs that Ecuador is open to foreign investment and view this trip as an important step by the Ecuadorian Government in focusing on the urgent investment needs of the country,” wrote Corriente’s Senior Vice President, Dan Carriere, in an e-mail to investors.
Correa’s statement [in the YouTube video] about how the “future of this country might be mining” is important to the industry due to the president’s influence over the Constituent Assembly. Eighty of the Assembly’s 130 members hail from Correa’s own political party, Alianza Pais. That gives him 61 percent of the votes, more than the necessary majority to win any constitutional draft or pass a new law. The Partido Sociedad Patriotica of former president Lucio Gutierrez has only 18 members, the Prian party of former presidential candidate Alvaro Noboa has nine, and other groups have five or less representatives each.
Correa’s requirements for international mining firms are nothing new. Most of these firms are currently running ambitious medical and educational programs in the communities, while patiently waiting for the government to introduce royalties, a tax they are accustomed to paying anyway.
Thus, experienced international mining entrepreneurs are prepared to lead the nation in producing its natural resources with the best environmentally-friendly practices, and with ambitious corporate social responsibility programs for communities. This might be the beginning of a better future for these abandoned and impoverished remote towns with no other hope to develop, but mining. And judging from his statement about mining perhaps contributing to the nation’s future, Correa might sense this.
“Several American cities, such as San Francisco and Denver, started with mining. They made this industry sustainable investing their revenue building schools and roads,” states Paul Driessen, author of Ecoimperialism: Green Power, Black Death.