MAC: Mines and Communities

Greystar Resources withdraws request for environmental permit in Colombia

Published by MAC on 2011-03-22
Source: Reuters

A significant victory for People and Paramos.

Canada's Greystar Resources has withdrawn its request for an environmental permit for its Angostura project in the Colombian páramos of Santurbán.

The company's move seems to let the Ministry of  Environment off the hook in having to make a decision on whether to apply Colombia's mining law, which would protect this unique biosphere.

This victory is a testament to the tremendous mobilisations in Bucaramanga and other parts of Colombia in recent weeks.

However, the victory may seem short lived for some people of Colombia since 12 hours after Greystar desisted from requesting an environmental license, clarified they were withdrawing this request to put in a new one for an underground mine.

Of course, given the opposition already expressed to the project and the fact that an underground mine would inevitably have a major “footprint” that would threaten the paramos, albeit to a lesser extent, one would hope and expect that the Colombian government would also refuse to entertain such a “modification”.

An estimated 108,972 hectares of paramo, across twenty two of thirty four such areas in Colombia, are still currently under mineral concessions.

Nonetheless, resistance against open-pit mining in paramos, upstream of Bucaramanga (where Greystar has had a presence since 1995), doesn't to bode well for Ventana Gold, or Galway Resources, that are working in adjacent areas.

Previous MAC coverage: Gold rush fuels conflicts in Colombia


Colombia says Greystar withdraws environment request


17 March 2011

Canada's Greystar Resources has told Colombia it would withdraw environmental and technical permit requests for the Angostura gold project, Colombia's energy minister said on Thursday.

Water sources in páramo de Santurbán
Water sources in páramo de Santurbán - Photo: Gabriel Aponte

Greystar has faced opposition from local Colombian authorities, the country's inspector general and environmental groups, which call its Angostura project a threat to a delicate Andean ecosystem.

"I received a call from the president and CEO of that company ... who just told me that they have decided to withdraw the technical license request ... and also the environmental license request," Energy Minister Carlos Rodado said in a statement posted on the presidency's website.

It was not clear if the company was ending the project or whether it would redesign or reapply due to environmental complaints.

The company was not immediately available for comment.

Critics have said the mine would affect Santurban, a so-called "paramo" area believed to be the source of rivers and streams that supply water to 2.2 million inhabitants in Colombia.

Colombia, once dismissed as a failing state mired in drug violence, is enjoying a resurgence in oil and mining investment as its years-long guerrilla war wanes and companies return to explore in areas that used to be considered too dangerous.

(Reporting by Luis Jaime Acosta and Jack Kimball)

Greystar says not abandoning Colombia gold project

Jack Kimball and Diana Delgado


18 March 2011

BOGOTA - Canada's Greystar Resources Ltd said on Friday it was not abandoning its Angostura gold project in Colombia and would present plans to change the mine to underground from open pit.

Greystar has faced opposition from local authorities, the country's inspector general and environmental groups, which call its Angostura open-pit gold and silver project a threat to a delicate Andean ecosystem.

"We have arranged to meet with the (Colombian government) early next week to discuss how the open-pit project can be modified to meet concerns and to present our proposal to proceed with an underground project," the company said.

"Clearly, there will be a delay to anticipated first production compared with the proposed open pit project, but we shall work rapidly to advance the next phase of study and drilling," the Toronto-listed firm said in a statement.

Greystar said in January that reconfiguring the project would push it back two years.

The Angostura project illustrates one risk facing new oil and mining operations in Colombia, where increased security is attracting a wave of investors to exploit rich resources, even as environmentalists push for stricter control.

Greystar is not alone in dealing with environmental hurdles to get its project up and running. Local authorities are also discussing whether to grant AngloGold Ashanti a permit for its La Colosa project.

Colombia's energy and mines minister said on Thursday that Greystar had told Bogota it would withdraw environmental and technical permit requests for the project. Critics have said the open-pit mine would affect Santurban, a so-called "paramo" area believed to be the source of rivers and streams that supply water to 2.2 million inhabitants.

Paramo occurs in the Andes between upper forest limits and the lower edges of snow line, but in Colombia, Paramo ecosystems vary depending on the mountain range. "The company wants to make the project acceptable to politicians and ministers," said Trevor Turnbull, an analyst with Scotia Capital in Canada.

"They realized that to make it acceptable they had to modify the project and the most acceptable way is doing an underground mine, however, they didn't rule out a smaller open pit mine," he said.

The company had planned to start construction of the mine early this year. Output of gold and silver was expected to begin in the second half of 2012, with an average output of 2.3 million ounces of silver per year over a 15-year mine life.

Angostura has 10.2 million troy ounces of measured and indicated gold reserves and 3.4 million of inferred resources, with 74 million ounces of silver reserves and resources, according to preliminary studies.

"As the focus on the project changes, they won't be able to mine the same amount of gold and silver," said Juan Felipe Mejia, an analyst with the local brokerage Interbolsa.

"They will have to concentrate on the area where they find most concentration of grams of gold as not all the gold is concentrated on the same site."

(Editing by Marguerita Choy; Editing by Marguerita Choy)

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