IMO this version takes much of the bite out of earlier related stories:

Ecuador May Suspend Mining for 180 Days, Correa Says (Update2)

By Stephan Kueffner

April 17 (Bloomberg) -- Ecuador may suspend some mining in the country for 180 days and take away some companies' concessions while a new law to regulate the industry is prepared, President Rafael Correa told reporters.

Mining companies with projects in Ecuador fell after Correa's comments, with Toronto-based Aurelian Resources Inc. slumping 14 percent, its biggest decline in almost three years.

Ecuador's president is seeking to take more control of the country's metal deposits as prices for gold, copper and other minerals hover near records. The announcement today follows moves by the government to renegotiate contracts with oil companies and take a greater portion of profits.

``The law seeks to revert all concessions handed out illegally, all concessions where no investment has been done and which were used only to speculate,'' Correa said.

Correa said he expects a bill that strips some concessions from mining companies and suspends all midsized and large-scale metallic extraction will be passed by the Constitutional Assembly tomorrow.

Companies that have carried out exploration and were ready to start production will have to wait six months to begin as Ecuador beefs up its regulations through the new law, Correa said today. ``We've spoken with many of those companies.''

Aurelian Resources shares fell C$1.24 to C$7.35 in Toronto Stock Exchange trading, its biggest decline since May 9, 2005. Dynasty Metals & Mining Inc. dropped 6.4 percent and Corriente Resources Inc., based in Vancouver, fell 16 percent. Iamgold Corp. was unchanged. Representatives of Dynasty, Iamgold and Corriente were unavailable for comment when telephoned by Bloomberg News.

Silver, Gold Deposits

Aurelian last year discovered a deposit in Ecuador holding an estimated 13.7 million ounces of gold and 22.4 million ounces of silver, the biggest such find in 2007.

``Aurelian has not yet determined the impact of the mandate on the company,'' it said in a statement. ``Aurelian does not know if the mandate will be approved.''

Dynasty owns three mining exploration areas in Ecuador. Iamgold plans to develop the Quimsacocha project in Ecuador. Corriente Resources has gold and copper projects in southeast Ecuador.

Some mining companies have been paying environmentalists to try to block the industry's expansion in an effort to reduce competition, Correa said, without identifying the mining companies.

Local communities should benefit the most from Ecuador's mining industry once it fully develops, perhaps as shareholders in the projects, Correa said. He has said previously that Ecuador has around $220 billion in reserves from minerals such as gold and copper.

To contact the reporter on this story: Stephan Kueffner in Quito at skueffner@bloomberg.net