Ecuador making mining-friendly noises

Ecuador’s Council of External Commerce and Investment has approved a resolution to eliminate import tariffs on a range mining equipment, Corriente Resources (CTQ-T, ETQ-x) says.

The list of tax-exempt equipment includes crushers, mills, screens and grinding balls.

Vancouver-based Corriente says that Ecuador’s Council of External Commerce and Investment, or Comexi, which is made up of representatives from important institutions and ministries, is sending a signal that the government wants to promote the development of mining in the country.

The resolution should give mining companies at least some comfort following news in April that the Ecuadorian government was freezing mining exploration and revoking most concessions. Since then, the country has been working on a new mining law designed to strengthen controls over the industry.

At the Denver Gold Forum in early September, Ecuador’s acting vice-minister of mines, Xavier Cordova, said that he expected exploration companies would be back at work by the middle of October. That target has come and gone.

The minister also noted that an unpopular 70% windfall profits tax on mining was not part of the proposed new mining code and that his ministry had made a proposal to the Ministry of Revenue to neutralize the tax or eliminate it altogether.

But Corriente is optimistic the new mining law will be passed very soon.

“The new mining law is in front of the Congress as we speak and we’re optimistic it will be proclaimed by the end of the year,” Kenneth Shannon, Corriente’s president and chief executive told The Northern Miner.

Shannon also notes that there have been more positive signs recently for foreign mining companies. These include plans for some major hydroelectric projects in southeastern Ecuador, where Corriente operates.

“A key thing you need for big mines is energy and that’s great the government has a plan to bring sizable energy resources to southeast Ecuador,” he said.

On Nov. 12, Corriente made public that Ecuador’s Ministry of Electricity and Renewable Energy had issued a bid tender for a feasibility study and detailed design for its Zamora hydroelectric complex.

One of the most important sites in the complex is the 1,200- megawatt San Juan Bosco project, about 6 km south of Corriente’s Panantza-San Carlos copper deposits.

Corriente holds a 100% interest in about 620 sq. km in southeastern Ecuador’s Corriente copper belt.