Deal #3105

Location #1

Spatial accuracy level
Coordinates
Location
California, Santander, Colombia

Latitude
7.383333
Longitude
-72.900000
Facility name
Angostura
Target country
Colombia
Location description
Northeastern of the Municipality of California is the main camp
Comment on location
The project consists of 14 mining projects, although 2 of them have been sold to a new investor with interest in the area. This new investor is known as Minesa and its owner is the government of the United Arab Emirates. The area of the project comprehends more than 30000 hectares of land, which have been purchased or conceded by the Colombian government since 1990. During the 2000s the company extended their domains by prolonging the concession contracts, getting new ones and buying land rights in the area. The are of influence is distributed in the municipalities of California, Vetas, Suratá, Charta and Tona, in Santander, and Cucutilla and Mutiscua, in Norte de Santander. You can look at Source 2 - Page 20 - for the polygons of the deal. The company owns 3700 hectares of land (Source 2, Page 21)

Land area

Intended size (in ha)
29520
Size under contract (leased or purchased area, in ha)
[2015, current] 3700
Comment on land area
The area consists of 14 Mining titles granted by the Agencia Nacional de Minería. Nevertheless, the company has also purchased some holdings for the extraction of the minerals found in the mine. During the last years, due to the legal uncertainty of the project related to the arbitration process started by Eco Oro against the Republic of Colombia and the forthcoming delimitation of the Páramo boundaries in the area, Eco Oro has allowed some mining titles to expire and has sold some properties to a new player in the area, which relates to the United Arab Emirates. The intended size in this deal relates to all the concession permits for exploration and exploitation. The size under contract refers to the acquisition (purchase of land) that has been occurring during the last years. It is uncertain the exact date of this purchase. They entail 25 different plots. According to the official mining institution of Colombia, all contracts mentioned below started a phase of extraction, that's why their sizes are considered in the intended size. Again, the company has purchased approximately 3700 hectares of land. Source 4 Source 5: Page 9, Page 6 Source 6 Source 2: Page 21

Intention of investment

Intention of investment
[2012] Mining
Comment on intention of investment
Estimate initial capital cost of US$ 529 Million. Source 1

Nature of the deal

Nature of the deal
Outright Purchase
Comment on nature of the deal
The company has been awarded by the Colombian authorities the permission to explore and extract minerals from Colombian soil. The interest of the company is to extract gold and silver in the area of influence. For the extraction of the minerals the company requires the acquisition of some land holdings on the surface, which can be done by purchasing the land. According to the company, it owned 3700 hectares of land by 2015. Although the company has allowed (or were forced by the government) some mining titles to expire and the existence of an ongoing arbitration process, the company has stated the remaining interest to exploit the mine. At the very first the idea was to build an open pit mine, but due to the pressure of the inhabitants of Bucaramanga and environmental groups, the company desisted and offered and underground mine, which would raise the costs. The investment entails several concerns due to the existence of a highly relevant and fragile ecosystem necessary for the conservation of water sources. Source 2 Source 6 Source 5 Source 7

Negotiation status

Negotiation status
[2007] Concluded (Contract signed)
Comment on negotiation status
The company has been present since 1990 in the area, although during the last decades it has extended their mining titles over time and the area of influence. Some of the mining titles have expired, due to either the allowance of the company for them to expire of the decision taken unilaterally by the Agencia Nacional de Minería. The date refers to the concession contracts for exploration. The company has purchased more than 3700 hectares of land. It is uncertain at which point in time they bought it. It is logic to assume that they bought them after they obtained the permission to explore the land. Source 5 Look at Catastro Minero

Implementation status

Implementation status
[2019, current] In operation (production)
Comment on implementation status
According to the Catastro Minero of the Agencia Nacional de Minería, some of the awarded mining titles are being already extracted. Source: http://www.cmc.gov.co:8080/CmcFrontEnd/consulta/index.cmc

Leasing fees

Annual leasing fee
9
Annual leasing fee currency
US Dollar ($)
Annual leasing fee type
per ha
Comment on leasing fees
The leasing fees depend on the type of mining title that the company holds. The two aspects affecting the value per hectare is the size of the title and the duration of the company having it. For more details see Source 2 (Page 25). Additionally to this, the company has to pay a royalty of 5% out of the 80% of the value of the extracted minerals. According to the government, the company has paid USD 10931160 until now for royalties. Source 7.

Contract #1

Contract number
3452
Contract date
1990-08-14
Duration of the agreement (in years)
36
Comment on contract
Size: 5244.85 hectares. For this and almost all the coming contracts, look at the search tool of the Catastro Minero in the Agencia Nacional Minera. This land title is the where the main camp is located. Known as Angostura http://www.cmc.gov.co:8080/CmcFrontEnd/consulta/index.cmc

Contract #2

Contract number
101-68
Contract date
2000-04-19
Duration of the agreement (in years)
19
Comment on contract
Size: 5.67 hectares

Contract #3

Contract number
127-68
Contract date
2000-04-19
Duration of the agreement (in years)
19
Comment on contract
Size: 19. Phase: Extraction

Contract #4

Contract number
6979
Contract date
1990-07-17
Duration of the agreement (in years)
35
Comment on contract
Size: 40 hectares. Phase: exploration, construction and extraction

Contract #5

Contract number
22346
Contract date
1998-09-29
Duration of the agreement (in years)
30
Comment on contract
Size: 1184.11 hectares. Phase: Exploration, construction and extraction

Contract #6

Contract number
300-68
Comment on contract
This contract is not found in the Catastro Minero, although it is mentioned by the company in Source 2

Contract #7

Contract number
13921
Contract date
1991-06-18
Duration of the agreement (in years)
22
Comment on contract
Size: 78.62 hectares. Phase: Extraction

Contract #8

Contract number
AJ5-142
Contract date
2006-10-26
Duration of the agreement (in years)
11
Comment on contract
Size: 4061 hectares. Phase: Ended

Contract #9

Contract number
AJ5-143
Contract date
2006-03-21
Duration of the agreement (in years)
10
Comment on contract
Size: 3890 hectares. Phase: Ended

Contract #10

Contract number
AJ5-144
Contract date
2007-11-22
Duration of the agreement (in years)
8
Comment on contract
Size: 4336 hectares. Phase: Ended

Contract #11

Contract number
EJ1-159
Contract date
2006-06-10
Duration of the agreement (in years)
11
Comment on contract
Size: 814.94 hectares. Phase: Ended

Contract #12

Contract number
EJ1-163
Contract date
2007-01-18
Duration of the agreement (in years)
10
Comment on contract
SIze: 8424.65 hectares. Phase: Ended

Contract #13

Contract number
EJ1-164
Contract date
2007-03-15
Duration of the agreement (in years)
11
Comment on contract
Size: 1439.34 hectares. Phase: Ended

Contract #14

Contract number
343-54
Comment on contract
Contract does not appear in the Catastro Minero, although it is mentioned in source 2 by the company

Number of total jobs created

Jobs created (total)
Yes
Current number of employees (total)
600
Comment on jobs created (total)
The government argues that the project has employed 600 people. This number might not be completely accurate. Source 7

Operating company

Name of investment project
Angostura project
Comment on investment chain
The concession contracts are held by the operating company, which is a local branch of Eco Oro Minerals Corp. The Angostura project got some investment by the International Finance Corporation, a member of the World Bank Group. Its support included buying USD 11 Million in shares of the parent company. The IFC left the project in 2016 after constant pressure of community and environmental groups for the environmental consequences of the project. Sources 6-11

 

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Data source #1

Data source type
Company sources
File
Date
2013-01-01

Data source #2

Data source type
Research Paper / Policy Report
File
Date
2012-03-23

Data source #3

Data source type
Company sources
File

Data source #4

Data source type
Company sources
File
Publication title
TECHNICAL REPORT ON THE UPDATED MINERAL RESOURCE ESTIMATE FOR THE ANGOSTURA GOLD-SILVER DEPOSIT, SANTANDER DEPARTMENT, COLOMBIA
Date
2015-07-17

Data source #5

Data source type
Company sources
File
Publication title
Management’s Discussion and Analysis
Date
2018-09-30

Data source #6

Data source type
Government sources
File
Publication title
Resolución No. 2090
Date
2014-12-19

Data source #7

Data source type
Government sources
File
Publication title
PINE-Santander
Date
2019-18-02

Data source #8

Data source type
Other (Please specify in comment field)
File
Date
2015
Comment on data source
Report of the International Finance Corporation

Data source #9

Data source type
Other (Please specify in comment field)
File
Date
2009-12-14
Comment on data source
Brief report by the International Finance Corporation

Data source #10

Data source type
Other (Please specify in comment field)
File
Date
2016-08-05
Comment on data source
Response letter from the International Finance Corporation with respect to the allegations by different environmental organizations on their participation in the Angostura Project

Data source #11

Data source type
Media report
File
Publication title
Protecting the Colombian Páramo from Eco Oro Mining | Center for International Environmental Law
Date
2017-02

How did the community react?

Community reaction
Mixed reaction
Comment on community reaction
There was a mixed reaction by the communities affected by the project. On the one hand, the people from Bucaramanga and its metropolitan area held several demonstrations against the presence of the mining project close to the sources of the water used for their aqueduct. They worry that this large-scale mine would pollute their waters with cyanide and other chemicals required for gold extraction. On the other side, the communities close to the area of influence are in favor of the project due to the employment generated and the acceptance of mining, which they make in small scale and in traditional manners, as a legal activity in the area. The delimitation of the Páramo boundaries requested by the Constitutional Court and environmental groups, might impede any mining activity within the established boundaries. Source 11

Presence of land conflicts

Presence of land conflicts
Yes
Comment on presence of land conflicts
According to the company, in the area of influence of the project, there is a high degree of land informality. Additionally, there is presence of Páramo ecosystem, being this extremely fragile and necessary for the water supply of almost 3 Million people in the municipalities in the Northeastern region of Santander. Source 11. Source 6

Negative impacts for local communities

Negative impacts for local communities
Environmental degradation

Promised benefits for local communities

Promised benefits for local communities
Education
Financial Support
Other
Comment on promised benefits for local communities
The company argues that pretends to create a foundation to support small businesses in the area of influence. They intend to offer social trainings to the owners of small businesses. These projects were held together with support of the World Bank. Source 2

Materialized benefits for local communities

Materialized benefits for local communities
Education
Financial Support
Other
Comment on materialized benefits for local communities
The company argues that pretends to create a foundation to support small businesses in the area of influence. They intend to offer social trainings to the owners of small businesses. These projects were held together with support of the World Bank. Source 2

Presence of organizations and actions taken (e.g. farmer organizations, NGOs, etc.)

Presence of organizations and actions taken (e.g. farmer organizations, NGOs, etc.)
Center for international Environmental Law, SOMO, MiningWatch Canada Source 11

Former land owner (not by constitution)

Former land owner
State
Private (smallholders)

Former land use

Former land use
Smallholder agriculture
Conservation

Former land cover

Former land cover
Other land (e.g. developed land – specify in comment field)
Comment on former land cover
Natural forest, including Páramo, an ecosystem of extreme relevance for conservation and water resources. Source 11, Source 6

Detailed crop, animal and mineral information

Resources area
Gold
Resources yield
Gold (222000 tons)
Comment on resources
Under the base case used for the Economic Evaluation of the program, they estimate the extraction of between 222000 and 303000 gold equivalent ounces per annum for 10 years. According to the Technical report published in 2015, they expect to extract 1034 koz of gold and 4192 koz of silver (koz: thousand ounces). Source 2 Source 4

Water extraction envisaged

Water extraction envisaged
Yes
Comment on water extraction envisaged
They already have permits to extract 7.2039 Lts/sec. Source 2 - Page 25 When the mine is under extraction, they would require 60 Lts/sec. Source 2 - Page 172

Source of water extraction

Source of water extraction
Groundwater
Surface water (River)
Comment on source of water extraction
They already have permits to extract 7.2039 Lts/sec. Source 2 - Page 25 When the mine is under extraction, they would require 60 Lts/sec. Source 2 - Page 172

How much water is extracted?

Comment on how much water is extracted
They already have permits to extract 7.2039 Lts/sec. Source 2 - Page 25 When the mine is under extraction, they would require 60 Lts/sec. Source 2 - Page 172

Voluntary Guidelines on the Responsible Governance of Tenure (VGGT)

Application of Voluntary Guidelines on the Responsible Governance of Tenure (VGGT)
Partially
Comment on VGGT
The company is working in areas with a high degree of land informality. The development of such projects in such areas is not advised by the VGGT. The company is aware of this issue. Nevertheless, it has acquired almost 3700 hectares of land.

Overall comment

Overall comment
The project known as Angostura is compounded by 14 Mining titles. 2 of them have been sent to a new Investor of Abu Dhabi in the area (Minesa), although the transfer has not been done. The project is under uncertainty because of the delimitation of the Páramo area done by the Ministry of Environment and Sustainable Development. The company has started an arbitration process against the Republic of Colombia for more than USD 700 Million. This process is comprehended under the Free Trade Agreement signed by Canada and Colombia in 2008. This project has been extremely polemic due to its location in an area of high conservation value in an extremely fragile ecosystem which is vital for water sources. Several demonstrations held by thousands of people in Bucaramanga opposed to the project, although the traditional miners of the area of influence are in favor of it. Although the government has been sued by Eco Oro, it still remains as a High Relevance Project for Colombia, according to the government.

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