MAC/20: Mines and Communities

Corporate and smallscale miners vie for gold in Paraguay

Published by MAC on 2008-02-03
Source: The Nation, Paraguay

Last year, a new mining law was passed in Paraguay (Law 3180), replacing the former mining code stablished in 1914. Many foreign companies then started looking for uranium (Cue Capital, backed by Cameco; Crescent Resources; Australia's WildHorse Energy; Vane Minerals; Yellow Cat Uranium PLC, and others).

Under the new law, the government is giving away mining concessions, but in some places, such as Guairá, small scale gold mining is already going on.

Two models of gold mining in a corner of Guairá

The Nation, Paraguay

3rd February 2008

A group of men are digging a trench in the foothills of the Ybytyruzú mountains. With picks, shovels and other tools they take turns under the sweltering Paraguay sun of January, laboring to arrive to mineral which by intuition or simply by "feel" could contain an interesting gold content. The hard work of digging could carry on for two or more days, with the risk that the bounty could be limited to only a couple grams of the precious metal. But these are the unwritten rules which for the past ten years have been the way of living for the more than 2000 inhabitants of the town of Paso Yobái, in the department of Guairá, Paraguay.

This story is not new in the country, except that since last year there now are coexisting two models, in a Paraguayan version of "gold fever": On one hand are the campesinos and their precarious methods and tools, on the other, a Canadian mining company – Latin American Minerals – which has secured a territorial concession from the Paraguayan government to install itself in the zone to carry out explorations and determine the viability of the business of gold mining.

Paso Yobái is located some 80 kilometers to the east of Villarrica, the department capital, and 250 kilometers from Asunción. The lure of mining has caused may families to abandon farming activities to dedicate themselves exclusively to artisan mining activities, although others have taken advantage of the economic prosperity to give a impetus to agricultural activities.

The presence of the Canadian company has generated many expectations in the population, as well as fears. Many cite hopes of generation of jobs and others ask themselves if they will be able to continue carrying out their artisan mining activities as before, once the company begins its exploration activities in the area.

Latin American Minerals is the Canadian mining company which, through its subsidiary in Paraguay, Latin American Minerals Paraguay, has begun to install machinery some months ago for prospecting and drilling in the Paso Yobái with the objective of carrying out large-scale gold mining operations in the area.

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