Silvia’s Ecuador Trip Diary: Entry Two

Silvia’s Ecuador Trip Diary: Entry Two

Published in Ecuador Mining News, June 11, 2008
March 17, 2009
Originally published in Ecuador Mining News

The conference began with remarks from Gustavo Pinto, president of the Geologists Association, who commented on the need to develop mining in mineral-rich Ecuador, which has high levels of poverty and unemployment, poor infrastructure, and uncontrollable emigration. Pinto also condemned the disinformation campaigns conducted by extremist environmentalists, and said that sustainable mining is possible in Ecuador.

Washington D.C. June 11, 2008 – Following my visit to Atlas Molly’s Tres Chorreras exploration project in Pucara, three hours outside Cuenca, I traveled to Quito to put the finishing touches onEMN’s inaugural pro-mining conference, the main reason for my visit. The conference, titled “Aprovechemos la Oportunidad Minera Ecuatoriana” (Let’s Take Advantage of the Ecuadorian Mining Opportunity) enabled different industry leaders to share information, and gained national media attention. Most important, however, the conference further unified diverse industry leaders under the umbrella of support for mining in Ecuador.

Another goal of EMN’s initiative was to energize stakeholders against the threat of environmentalist extremism. That goal was well understood by Ecuavisa, the most influential TV news channel in my country. Ecuavisa reported my event as a joint endeavor to develop the best mining practices in Ecuador, and presented the industry viewpoint alongside that of mining critics.

Also, the Quito-based El Comercio newspaper published a short piece titled “Mining Still Attracts Investors’ Eye.” The publication refers to the results of the EMN Investors’ Concerns Survey, where a majority of respondents –most of whom were Canadian investors – expressed interest in keeping their investments in Ecuador, but had high levels of uncertainty due to changes in the nation’s attractive 2000 Mining Law. It should be noted that both the EMN pro-mining event and survey occurred prior to the Constituent Assembly’s mandate to halt all large-scaled mining activity for six months.

Rolando Moya, president of the Small-Scale Mining Association in Pichincha, for his part, added that Ecuador should welcome all size mining operations. “We think that artisan miners and small-scale ones should improve their techniques alongside large ones.”

Jean Pierre Jarrin, independent consultant and the third speaker, commented on the troubling deforestation happening in Ecuador’s protected areas due to lack of opportunity. In those remote areas, he said, locals sell fine wood boards worth $100 on the international market for only 25 cents. Jarrin’s proof: satellite images taken in the 1970s and 2000, in areas where mining companies hold concessions but never commenced operations. These images illustrate the environmental degradation pristine lands suffer at the hands of locals who desperately require work that mining companies could very well provide, if allowed to. Nevertheless, environmental extremists fight fiercily against mining operations, placing the sole blame for deforestation on firms while ignoring their potential to provide a solution.

Fourth speaker Cesar Espinosa, president of the Ecuadorian Mining Chamber, was a big draw and was generous with his praise for EMN. He started his speech flattering the EMN project, my optimism, the day’s pro-mining initiative, and how lucky the industry is to have an ally in Washington D.C. willing to be the bridge between Ecuador’s mining progress and international investors.

Espinosa’s also commented on the industry’s focus on safe environmental practices, especially those of Canadian firms currently investing in the country. “We are all environmentalists. I’m an environmentalist myself. I cannot favor an industry that will pollute my children’s country. I will not compromise their future. I’m a miner, yes. But before that, I’m a father and a human being,” he said.

Finally, serving as the last speaker, I formally presented the EMN project and its Spanish version, Noticias Mineras del Ecuador. I also described the details of my pro-mining initiative including my visit to the Constituent Assembly, the visit to Atlas Molly, and my interview with CN3 news channel. In addition, I presented in detail the EMN Investors’ Concerns Survey results and explained how sensitive investors are during this uncertain time – prior to the Mining Mandate—and distributed a study regarding the risks of implementing a windfall tax. The study was authored by the very reputable Mark Turner, Latin America equities analyst at Hallgarten & Company.

I left the conference with some thoughts on who will benefit from Ecuador’s foolhardy failure to develop large-scale mining: other mining frontiers with more favorable mining legislation such as Peru and Chile; the “coyotes” who prey upon Ecuadorian migrants seeking passage to the United States on unsafe boats; and environmental extremists who perpetuate poverty – and fail to protect the environment – in little countries like mine.