By Stephan Kueffner

April 18 (Bloomberg) -- Ecuador stripped some companies of mining concessions and will suspend most mining of metals such as gold and copper for as long as 180 days while a new law to regulate the industry is prepared.

Members of the Constitutional Assembly, who are drafting a new charter for the country, voted 95 to 1 in favor of the rules, with 25 members abstaining.

President Rafael Correa's administration is seeking to take more control of the country's metal deposits as prices rise globally. The vote sends a negative signal to markets and breeds uncertainty in the industry, said Lehman Brothers Holdings Inc. economist Gianfranco Bertozzi.

``The rules can be changed when it benefits the government, and the government is prone to take more of the upside when the investment is lucrative and prices are high,'' he said today in an interview. ``It's not a great signal.''

The move cancels many of the more than 5,000 mining concessions in Ecuador, including all those handed out in protected areas or where water sources are threatened. It also declares a moratorium on new concessions before a new constitution is drafted. Correa has said that Ecuador has mineral reserves amounting to about $220 billion.

``What's at stake here is to define the future of large- scale metallic mining in Ecuador,'' said Alberto Acosta, the assembly's president and a member of Correa's Alianza Pais party, in a speech before the vote. ``The new mining law will favor serious entrepreneurs, not the speculators, because with clear rules, they will be able to work.''

Oil Contracts

Members of the assembly, which meets in the coastal town of Montecristi, were elected last year to write a new constitution for the South American country.

The measure may be an indicator that Correa could follow the lead of Venezuelan President Hugo Chavez in seeking to nationalize key industries, Bertozzi said.

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