Chamber: Mining has ground to a halt - Ecuador

By Harvey Beltrán, Business News Americas

Ecuador's mining sector is on hold as there are no new projects and some companies have left the country, the president of the country's mining chamber (CME) César Espinosa told BNamericas.

In early June, Ecuador's mines and oil ministry withdrew 1,138 mining concessions as ordered by the national constituent assembly in a mandate.

The mandate called for the closure of areas where annual payments to maintain permits had not been made as of December 2007, along with all concessions still being processed as of April 18, 2008.

However, Espinosa feels that once a new mining law is implemented, effectively ending the mining mandate, the sector will resume activity.

"As soon as we establish the rules of the game and there is a definitive law, I think activity will get back to normal," he said, adding that "the country has enough potential for mining companies to see it as an investment target."

Espinosa also said the most important factor is a firm decision by the country's President Rafael Correa regarding development of Ecuador's mining sector.

"Right now we're working to build all of the scaffolding that's necessary for the president's plan to come to fruition," he said.

Companies working in Ecuador include Aurelian Resources (TSX: ARU), IAMGOLD (TSX: IMG, NYSE: IAG), International Minerals (TSX: IMZ) and Ecuacorriente, the local subsidiary of Canadian miner Corriente Resources (TSX: CTQ).