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Ecuador’s First Large-Scale Mining Contract Signed Amid Doubts

Article Summary:

The first contract for large-scale mining in Ecuador, which allows operation for 25 years of the Mirador project to Chinese company Ecuacorrientes SA (ECSA) was signed, but received criticism from both the National Assembly and environmentalists. Mirador is the first of at least five projects that Ecuador plans t install the south east of the country.

Original Article Text From El Universo via Google Translate :

Mirador Mining Contract Was Signed Today Amid Doubts

The first contract for large-scale mining in Ecuador, which allows operation for 25 years the Mirador project to Chinese company Ecuacorrientes SA (ECSA) was signed today in the Yellow Room of Carondelet.

The event, which will broadcast satellite airwaves, comes amid criticism from the Assembly and faults environmentalists for legal, environmental and economic. Mirador is the first of at least five projects that the Government plans in the south east.

Last week, Minister of Natural Resources Non-Renewable Wilson Pastor, emphasized the benefits of the contract, indicating that ECSA will initially invest $ 1,400 million in the first five years. Production will begin in late 2013 and is expected to reach maximum two years later. He said the state will receive royalties of between 6% and 8% depending on the price per pound of copper. said that mining income in this contract will get the State shall be at least 52%, which includes 12 % of VAT, income tax and extraordinary price and the profits and royalties. ECSA deliver $ 100 million in advance royalties.

These will be recorded in three parts: $ 40 million contract after approval of the investment, $ 30 million when they obtain the permission of the National Secretariat of Water, Heritage and the Ministry of Environment, and a third payment of $ 30 million when it built a power plant to be connected to the mine. It found that income per capita of the inhabitants of the site will be one of the highest in the country. However, there are objections to the mining project.

Gloria Chicaiza, mining coordinator for Ecology Action, said it’s troubling that neither the environmental impact assessment or environmental permit has been approved and signed the agreement. “It’s a regrettable signal given by the Government, that is sure that the license is not approved, “he says. For her, there is pressure from this company in China to which the Government has no option of resistance. She associated the pressure of the importance China has acquired as the main creditor of Ecuador.

Chicaiza explained that environmental agencies and the Ministry of Environment have made ​​comments to the draft environmental study is not yet approved. How much is the destruction of the Shuar community? How much run out of the environmental regulator of the Cordillera del Condor and pollution of rivers, he wondered. Assemblyman Zamora Chinchipe Clever Jimenez, said that the Mining Act is against the Constitution, especially Articles 405 and 408. The first talk that no foreign company can have concessions in the areas of national security. The sector of the Cordillera del Condor, which also is a biosphere reserve is located just in the security zone.

The 408 says that the state will take advantage of resources in an amount not less than the company that exploits them. For Jimenez, this is not true. Despite criticism Pástor has said that “the main beneficiaries are the residents of nearby areas to the mining project.” Location El Mirador project is located near the parish Tundayme, belonging to the village of El Pangui, Zamora Chinchipe. It has reserves of copper close to the 5,000 million pounds. capacity could process 60,000 tons per day at a cost of $ 4 per pound. The mine would generate 3,000 jobs.

Link to Original Article:

From El Universo

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