BASE METALS

Codelco-Enami face Llurimagua uncertainty

Chile’s state copper company Codelco and Ecuador’s state mineral company Enami face uncertainty as they seek to advance the Llurimagua copper joint venture project in Imbabura after Ecuador's comptroller identified at least 12 irregularities in the concession that are cause for termination.

 Ecuador's comptroller critical of LLurimagua agreement

Ecuador's comptroller critical of LLurimagua agreement

The comptroller recommended the project's environmental licence be reversed as well as the permits awarded by the water authority. This is a possibility which will be pushed for by communities in Íntag that have rejected mining for years.

The Llurimagua deposit has a resource of 982 million tonnes grading 0.89% copper and 0.04% molybdenum.

While the two companies entered into a partnership for the project in December 2015 following a bilateral government agreement, among the failings the control entity indentified was that they did not form a mixed stock company for the project in September 2016 as they should have, as Enami lacked the funds to contribute towards its capital.

The partners were in non-compliance with this obligation for 475 days through December 2017, the end of the period under investigation, although it took much longer for Codelco and Enami to form a joint-venture company. They finally announced the formation of a limited company in March 2019, in which Enami has a 51% stake and Codelco 49%.

The comptroller said the partners failed to comply with the agreed investment plan and had not paid compensations stipullated under law.

Further, the comptroller said the environment ministry approved an environmental impact study and management plan without receiving complete information. It was thus unable to identify sensitive areas to possible impacts and request corresponding mitigation measures.

It also criticized a report about the social participation process on the grounds that two of its three authors were not qualified to complete it, and so the document lacked both a technical and legal foundation which meant prior consultation undertaken was not valid.

 

A growing series of reports, each focused on a key discussion point for the farming sector, brought to you by the Kondinin team.

A growing series of reports, each focused on a key discussion point for the farming sector, brought to you by the Kondinin team.

editions

Mining Journal Intelligence Investor Sentiment Report 2024

Survey revealing the plans, priorities, and preferences of 120+ mining investors and their expectations for the sector in 2024.

editions

Mining Journal Intelligence Mining Equities Report 2023

Access an exclusive, inside look on the quarterly mining IPOs and secondary raisings data and mining equities performance tables with an annual Stock Exchange Comparisons supplement.

editions

Mining Journal Intelligence World Risk Report 2023 (feat. MineHutte ratings)

A detailed analysis of mining investment risks across 121 jurisdictions globally, built on 11 ‘hard risk’ metrics and an industrywide survey.

editions

Mining Journal Intelligence Global Leadership Report 2023: Social licence

Gain insights into social licence trends and best practices from interviews with 20+ top mining company executives and an industrywide survey.