Ecuador has temporarily suspended mining permits because of Indigenous group opposition.
On Monday, the Constitutional Court of Ecuador suspended an order issued by President Guillermo Lasso at the end of May permitting environmental consultations for mining and oil projects.
The court has agreed to process an unconstitutionality claim filed by the Confederation of Indigenous Nationalities of Ecuador (CONAIE) after the organization reported violations of fundamental rights.
The organization claims the government violated Indigenous rights by not including them in decisions or adequately consulting them prior to permitting mining projects.
Two referendums later this month will decide whether oil and mining projects in key areas of the nation will be able to continue or commence, with citizens weighing environmental and Indigenous concerns over billions in economic losses.
Lasso’s government now has 15 working days to present evidence to the court on why it thinks the president’s order is acceptable.
“The suspension comes after the CONAIE and allied organizations will present a claim of unconstitutionality, arguing that the decree violated the following fundamental rights: right to prior consultation, right to participate in decisions, right to regulatory adaptation and right to justice and the rule of law,” reads a bulletin posted Monday by the Indigenous group.
President Lasso wanted to accelerate the permitting process for oil and mining projects in the country prior to the end of his term this month but his efforts have been unsuccessful so far. His government had pledged to help accelerate mining development to aid the country’s struggling economy earlier this year.
One of the referendums in Quito this month could potentially ban mining in the Chocó Andino forest, thereby thwarting exploration efforts in six gold mining concessions.
A petition has been launched in support of that referendum, which has received over 26,000 signatures. Environmental advocates believe the bans would protect nature, secure water reserves and combat climate change but others such as the country’s Mining Chamber and domestic oil company Petroecuador think they would have a drastic impact on the country’s economy.
🌿 ¡Importante decisión! 🚫 Corte Constitucional decidió el martes suspender provisionalmente el decreto para realizar consultas ambientales en zonas de interés minero. ¿Cómo afectará esto al medio ambiente y a las comunidades? 🏞️ #ConsultasAmbientales #Minería #Ecuador pic.twitter.com/KXIto9FR4K
— Madre Libertad Ecuador/Lcdo.Julio Ayala Serra (@EcMadreLibertad) August 2, 2023
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Mining is a key economic driver in Ecuador
Mining was Ecuador’s fourth most significant source of income last year, contributing approximately US$2.8 billion to the country’s economy.
The nation’s mining companies Adventus Mining Corporation (TSX-V: ADZN) (OTCQX: ADVZF) and Salazar Resources Limited (TSX-V: SRL) (OTCQX: SRLZF) benefitted from the president’s order prior to court’s decision to halt it.
“The immediate effect of the provisional suspension of the decree is that no medium or high impact projects, from any sector or industry in the country, including the El Domo – Curipamba project, shall be able to obtain an environmental license until the Constitutional Court resolves this issue,” said the two companies in a joint statement Wednesday.
Adventus and Salazar were making significant progress with their El Domo joint venture project prior to the court’s ruling. Atico Mining Corporation’s (TSX-V: ATY) (OTCQX: ATCMF) La Plata gold-copper-zinc-silver project and the Loma Larga copper-gold project run by Dundee Precious Metals (TSX: DPM) are also expected to be impacted by the suspension.
Other mining companies operating in the country include Lundin Gold Inc. (TSX: LUG) (Nasdaq Stockholm: LUG) (OTCQX: LUGDF), owner of the Fruta del Norte gold mine in southeast Ecuador; SolGold (TSX: SOLG) (LSE: SOLG), which recently received a 25-year renewal for its Cascabel copper-gold project in the country’s north; and Lumina Gold Corp. (TSX-V: LUM), operator of Ecuador’s Cangrejos gold-copper project.
rowan@mugglehead.com
