Colombian regulator shelves AngloGold’s permit request for Quebradona

AngloGold Ashanti (NYSE: AU; ASX: AGG; JSE: ANG)  said today that Colombia’s environmental regulator or ANLA, its initials in Spanish, had shelved the permit application for its Quebradona copper-gold project.  

The decision was taken “following a technical, rigorous and comprehensive evaluation of the environmental impact study, of what was collected during site visits, of additional information presented by the company and the perspectives of other entities,” the ANLA in a statement. 

The company said it had not yet received the formal notification of the decision, which it can appeal.

It noted that a decision to “archive” an application is made when the regulator determines that it requires additional information to either confirm or deny a permit request.  

“The applicant can decide whether to appeal the decision or refile the application,” AngloGold said. 

The proposed mine, deemed by the government in 2008 as a project of national strategic interest, has faced on and off opposition from locals in Antioquia, the state where the project is located. They recently sought and failed to protect 60% of the soil around the mine, declaring the area of agricultural use only. 

“Quebradona remains one of the world’s most exciting new copper-gold projects and we are encouraged by the strength and continued growth in support for its development at the national level,” AngloGold said. 

The principal technical considerations that led to the shelving were the definition of the project’s area of influence, hydrological, geo-technical and hydro-geological issues and considerations related to the disposal of mining residue, the ANLA said, without providing details. 

The copper mine, which will produce gold and silver as by-products, is expected to process around 6.2 million tonnes of mineralized material per year with an average grade of 1.2% copper during its 21-year productive life.  

First production is expected roughly four-and-half years after the start of construction. 

AngloGold anticipates annual production of 3 billion lb. copper  (1.36 million tonnes), 1.5 million oz. of gold and 21 million oz. of silver over the mine life. 

Losing the battle to get Quebradona off the ground would be a major blow for the company’s new CEO Alberto Calderón, who assumed the role in September. 

The Colombia native has vowed to take risks in his home country,  where AngloGold  is moving forward with another project, Gramalote. The company is developing the asset with  joint venture partner B2Gold (TSX:BTO; NYSE: BTG). The gold project is at the centre of a long-dragged out mining rights dispute with Canada’s Zonte Metals that remains active. 

AngloGold has been shifting focus from the home country to more profitable mines in Ghana, Australia and Latin America as the industry in South Africa dwindles amid power cuts, soaring costs and the geological challenges of exploiting the world’s deepest deposits.