Ecuador eases rules on early-stage exploration drilling

Ecuador’s Minister of Energy and Non-Renewable Natural Resources says holders of mining concessions can now drill on early-phase exploration projects in the country. Previously, drilling was only permitted during the advanced exploration phase and required an environmental licence.

Under the June 28 decree enacted by Minister Carlos Perez Garcia, concession holders can drill from up to 40 platforms on each concession as long as they obtain authorization for industrial water use from the National Water Secretariat.

Allowing scout drilling during initial exploration is positive news for the Ecuadorian mining industry and especially for companies that made investments within the concessions that were granted through the tender processes that started in 2016, Cesar Zumarraga, a partner at Tobar ZVS Spingarn, wrote in a legal bulletin for the firm.

“When the [tender] process started, many companies committed to make investments with the understanding that permits and authorization would be granted in a timely manner,” he notes. “Regretfully, this did not occur and investments have slowed due to the delay on issuing licences and permits specifically from the Environmental Ministry and the National Water Secretariat.”

“We are confident that the possibility of carrying out scout drilling during initial exploration activities should restart the flow of investments,” continued Zumarraga, who leads the firm’s natural resources, energy and infrastructure unit. “For Ecuador and the companies, it is a win-win.”

Lumina Gold Corp. (TSXV: LUM; US-OTC: LUMAF) says the new decree will enable the company to drill previously untested areas on the west side of its Cangrejos deposit (C20), as well as its Gran Bestia satellite deposit, about 1 km away.

The Cangrejos gold project is in southwestern Ecuador’s El Oro province, 30 km southeast of the provincial capital, Machala.

The new regulations will also enable Lumina to start drilling at Orquideas, part of an earn-in with First Quantum Minerals.

Lumina’s land package in Ecuador consists of 135,000 hectares and includes the Condor gold-copper project in the country’s southeastern Zamora-Chinchipe province.