Q&A OTHER JURISDICTIONS
amount of time, 180 days or whatever it is, to act on the permit application or the permit issues by default. They, the regulators, know this and they tend to be prompt about addressing applications. In Colombia, where no- body even gets a wrist slapped, they just don’t worry about it. I actually had a government attorney ask me what the difference was whether we got a permit in a week or two or in three months, and he wasn’t joking, he literally didn’t see why it should make a difference to us.
This is the single largest hurdle that all the foreign companies have. One
of our main projects is in a holding pattern right now, actually two of them because we’re waiting on water permits for our core drilling. The amount of water we’re seeking to use is about amount you get out of garden hose. We submitted applications October 2012, and we still do not have them as of this afternoon. I do not believe it’s corruption, I might suggest that it’s incompetence, they don’t have that finishing touch in their regulatory frame- work that says, the regulatory agencies have to act within the legally specified time or the permit will issue by default. This one piece of legislation would solve 90% of the problems foreign and domestic exploration companies are experiencing in Colombia today. Without it, through administrative silence, the Colombian regulators are effectively taping a plastic bag over the col- lective heads of the investors and companies trying to work there and telling them to hold their breath.
So you see this as an industry-wide problem? Yes, for example at AngloGold, has two large deposits they want to put into production. They’ve been trying for years to get permits for construction and pre-production activities at least since 2007, and so far, nothing. No foreign company has permitted a new mine in Colombia successfully to date.
AngloGold’s largest deposit has contains roughly 25 million ounces of
gold and will be one of the world’s biggest gold mines, yet the Colombian government just can’ get out of their way.
If you ask almost any executive in any company active in Colombia what
the biggest problem is the almost universal answer is permitting and mineral titles.
NGOs seem to be able to influence the mid-level bureaucracy which con-
tributes to the problem, but I think an awful lot of it comes down to in- competence and ignorance. I don’t even think it’s corruption, I just think they don’t have the knowledge, or understand the value of time.
In all of the world’s leading mining jurisdictions, Chile, Australia, or the
state of Nevada, they all require extensive permitting for mines. The regu- latory agencies have a responsibility to process those permits and if they de- cide to do nothing, the permits will issue by default. The regulators don’t want that to happen because they’re responsible if something goes wrong.
Are the territorial rights of indigenous peoples a source of legal trou- ble for mining operations? Generally no, and I do not expect them to become one, at least in the near future. On May 11 this year, a change to Colombia’s mining law will take place. Most of the work being done in Colombia is on mineral titles issued under a mining law passed in 2001. That law was replaced with the current law in 2010 with that had some good and some bad in it. The new (2010) statute was generally not as well written as the 2001 law, but it did mandate consultation, addressing the concerns of indigenous and black communities in Colombia. But there were things in the newer law that the Colombian Supreme Court found to be unconstitutional. So as of May 11, the 2001 mining law will be re-enacted and then Congress can amend the law.
Most companies operating in Colombia do try to address local and in-
digenous community concerns. Consultation on the ground is critical— we’re spending over $70,000 dollars on this initial consultation with the three indigenous communities on a new project to identify their concerns, what their needs are, what we can do to help them and to be a good corpo-
“
Most companies operating in Colombia do try to address local and indigenous community concerns. Consultation on the ground is critical
rate citizen. At another of our projects, the El Dovio project, the community is com-
posed entirely of indigenous people but they do not have a formally recog- nized indigenous community. Even though we’re not required to do anything, we strive to be a good corporate citizen and help the community provide for its members what it could not if we were not there. In Colombia, your best defense against guerillas and security issues is having the locals and indigenous peoples be your best friend. If they value your presence, they will warn when you something seems to be wrong. As examples, we helped them re-paint the school, helped them replace windows in the school that got blown out in a storm that they didn’t have the money to replace. They didn’t have a medical clinic so we got the government to supply medical fa- cilities, and we pay for a nurse to staff the clinic. Now there’s a medical clinic in the village on the property. If one of our people gets hurt, we want to have good first responder capability on hand, but the whole community benefits, they get examinations and shots without having to make a two- day trip to the nearest clinic. They benefit because it’s infrastructure we want for our people anyway. We, and I think most modern companies active in Colombia, try very hard to create “win – win” situations for everyone. I’ve done a lot of work in various jurisdictions around the world where you have indigenous community concerns. You need to appreciate those concerns, they live there.
One of the biggest things we do on all of our projects, we hire people
from that immediate area, typically within a couple of miles of our project boundary. We try to make sure that if anybody wants a job, they get have a job before somebody from Bogota or Medellin or somewhere else. We al- ways try contribute to the local economy first and foremost.
ENERGY & INFRASTRUCTURE | LATIN AMERICA 2013 71
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