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Ecuadorian Constitutional Court

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    To start I acknowledge that there will be some who will not want this thread under this title to appear on the forum. Yes it may effect SP and perhaps seriously. Or by bringing the facts into the open, it may not.

    If the Spirit of HC stands for anything it is for earnest open discussion of issues which might effect our investments, and also let's acknowledge that ignorance is a veil which distorts our worldview and hampers our judgement.

    The issue is that in Ecuador (and in Columbia, too) an individual can make representation to a Constitutional Court about any issue of significance in one of the provinces. If the court finds the issue complies with conditions and restraints (which I do not understand) and if the individual obtains signatures of 10% of citizens and if the Electoral Council agrees the matter goes, as a referendum, to the people at the next Election.

    This process has been started in opposition to mining in the northern province of Ecuador where SolGold has its Cascabel discovery.
    The Constitutional Court convenes next week - it is expected that the weight of opposition from government, the mining industry and hopefully government environmental agencies will result in the application failing.

    Nevertheless Solgold's SP has tanked over the last few weeks, but has also recovered over the last few days.


    https://hotcopper.com.au/data/attachments/1577/1577153-9e955d64c30832375cfe290d54394865.jpg

    https://hotcopper.com.au/data/attachments/1577/1577155-1137de56e2048b7098bd9a210d43f900.jpg

    The charts are available from a google search.

    So SolGold went from a high of 48 pounds (on London AIM exchange) to a low of 25 pounds and closed Friday at 31 pounds.

    There is no suggestion that a similar situation has developed in the province where STM holds Bramaderos. However I think that the general issue is partially responsible for the erratic SP response to the excellent second hole result at Limon.

    While there has been very little discussion here about this aspect of Ecuadorian risk, there has been robust talk on SolGold forums. One which I found enlightening is found by googling London South East Solgold.

    http://www.lse.co.uk/ShareChat.asp?ShareTicker=SOLG

    This from Padmaster on that forum, with acknowledgement and thanks.

    "It is not possible for a group of people engaged in illegal mining activity to call a popular consultation. We have to support formal mining, "said Patricio Alarcón, president of the CEE.

    The formal mining activity that is currently taking place in the country will represent around US $ 10 billion in revenues until 2021, the CME reported.

    Santiago Yépez, president of the CME, said that the companies that work on these projects comply with the regulations, but at the same time requested legal security to develop the projects.

    The companies SolGold, Newcrest, BHP Billiton, Cornerstone, INV Metals, Codelco and Hancok Prospecting operate in Carchi and Imbabura. These firms are in charge of so-called second generation projects such as Llurimagua and Cascabel.

    For his part, Pablo Zambrano, president of the CIP, announced that the sector will present an appeal of amicus curiae before the Constitutional Court, to intervene in the discussion of the new request for popular consultation.

    The issue is important to us, do we just scamper and forgo what could be a marvelous wealth making opportunity, or do we take it all on board and see it as most likely just a roadblock to be cleared?

    Of overwhelming importance is the value of Mining to the Ecuador economy - first there is the massive investment to get the mines operating, including investment in infrastructure and advanced support industries, then the long term value from employment royalties and taxes and finally the establishment of secondary and tertiary processing and eventually manufacturing.

    Ecuador will find a way, being used to smelling the roses, they will get used to smelling the fruits of big mining.


    Memo: In Ecuador, being on the equator, the roses grow straight up and have stems which are thick and straight and tall. By selecting optimal altitude perfect growing conditions can be found. Their roses are regarded as the biggest and most beautiful in the world.



 
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