PDAC: Ecuador vows faster mine permits under new law

Ecuador President Daniel Noboa last week signed a mining overhaul that revamps environmental permitting, creates protected mining zones with security forces and reshapes how royalties flow to local governments as Quito tries to pull in new investment and push back on illegal mining.

The law, approved by the National Assembly on Feb. 26 and signed by Noboa on Feb. 28, replaces Ecuador’s existing environmental licence with a broader “environmental authorization” regime and adds measures meant to streamline approvals, formalize artisanal miners and open parts of the power sector to private investment.

“Legal certainty under the new rules means clear, upfront rights and obligations tied to the mining concession and fewer midstream rule changes, with remaining investor concerns to be addressed in forthcoming regulations,” Environment and Energy Minister Inés Manzano said Monday during Ecuador Day events at the Prospectors & Developers Association of Canada convention in response to a question from The Northern Miner.

Ecuador is trying to boost output beyond its two operating large-scale mines – Lundin Gold’s (TSX: LUG) Fruta del Norte and the Chinese-backed Mirador copper mine – in a country where new projects have faced court challenges, community opposition and shifting rules.

New rules

Under the new framework, the environmental authorization can take one of three forms based on risk, including a full licence for higher-impact projects and streamlined pathways for lower-impact projects.

The changes aim to cut the long wait for approvals without loosening standards, Manzano told the audience.

“We know that we have a lot of waiting time, more or less two years,” Manzano said. “Government’s aim is to reduce administrative delays.”

Public summaries of the sanctioned law show the government also revamped the royalty framework. Royalties are set at 3% to 8% of sales, with 60% of those revenues directed to local governments for social projects.

Government is re-examining mining taxes introduced recently. “We are reviewing our mining taxes,” the minister said. “We are aware of the impact.”

New development

PDAC attendees Monday heard updates on Lundin Gold’s Fruta del Norte expansion work, Silvercorp Metals’ (TSX: SVM; NYSE: SVM) El Domo project at Curipamba, SolGold’s (LSE: SOLG) Cascabel copper-gold discovery in Imbabura province, Sunstone Metals’ (ASX: STM) Bramaderos and El Palmar exploration projects and Solaris Resources’ (TSX: SLS; NYSE: SLSR) Warintza copper project in Morona Santiago province.

The government’s political bet is that a tighter permitting framework, clearer royalty flows and a harder line on illegal mining can turn Ecuador into a more investable jurisdiction.

“What’s not acceptable for Ecuador is the expansion of illegal mining that operates outside the law, destroys ecosystems and finances organized crime,” Vice President María José Pinto told the gathering.

Security

Security is the other pillar of the government’s message. Reforms create a protected mining zone meant to station troops in areas threatened by illegal mining and criminal gangs, while also formalizing artisanal mining.

Ecuador had identified about 400 illegal mining sites nationwide, Manzano said, casting illegal gold as both an environmental issue and a public-safety threat.

The industry’s challenge will be proving the new rules can speed projects while easing, not inflaming, the conflicts that have slowed the sector’s growth since large-scale mining began in 2019.

The government’s push to pair mining reforms with security measures follows the May 2025 Alto Punino ambush, when 11 Ecuadorian soldiers were killed during an operation against illegal gold mining – a flashpoint that showed how illicit mining has become entangled with organized armed groups.

Stability

Investors want predictable rules and faster, clearer decisions, Canada’s ambassador to Ecuador, Craig Kowalik, told the room.

“What I’m hearing is that investors are seeking a predictable environment underpinned by the respect for rule of law, contract, security, transparency and efficiency,” he said. He welcomed efforts to streamline approvals and improve the royalty model.

Still, the overhaul is landing in a polarized environment. Environmental and Indigenous groups have argued the shift away from the current environmental licence could weaken oversight and erode communities’ rights around prior consultation.

The social-licence risk was demonstrated in October, when Ecuador revoked the environmental licence for Dundee Precious Metals’ (TSX, ASX: DPM) Loma Larga project after large protests in Cuenca over water and páramo impacts.

For companies, the near-term test will be how regulators apply the new authorization system in practice – and whether timelines shrink without triggering a new wave of legal challenges.