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Guatemala to Review Mining Licenses Amid Corruption Claims

Government vows to ensure transparency and accountability in the mining sector

by Victor Adetimilehin

Guatemala’s new minister of energy and mines, Victor Hugo Ventura, has announced that his ministry will revise all decisions made in the recent past related to mining exploration, exploitation and export licenses. The move comes in response to multiple complaints regarding bribes, corruption and other illegal activities taking place within the country’s mining sector.

Seventy years ago, mining began in Guatemala, and Ventura stated that the sector’s decisions would balance the social, economic, environmental, and financial costs and benefits. He also requested the support of the Comptroller General of Accounts, as well as information from interested parties, including countries such as the United States of America.

The minister recalled that back in 2022, the US applied sanctions to the export licenses of three mining companies that are subsidiaries of the Swiss-based Solway Investment Group. These sanctions were lifted in the third week of January 2024 and Guatemalan authorities are asking for further information to re-authorize their operations.

After taking office on January 15, 2024, President Bernardo Arévalo’s administration is promoting the principles of transparency and zero tolerance for corruption, which the ministry aims to follow.


Environmental concerns over open-pit gold mine

Another issue that the ministry will review is the environmental license granted to Bluestone Resources, a Canadian mining company, for its Cerro Blanco project. The project involves an open-pit exploitation of gold deposits in the Asunción Mita municipality.

Initially, the company had proposed an underground operation but decided to switch the mining method as a result of advanced engineering and optimization work that revealed an opportunity to capitalize on the project’s near-surface, high-grade mineralization.

A feasibility study for Cerro Blanco released in February 2022 calls for an open-pit gold mine with an average annual production of 197,000 ounces over its 14-year life. At peak production, the operation would produce 347,000 ounces of gold a year.

However, the fact that an open-pit operation would require the use of cyanide set off the alarms of nine environmental groups both in Guatemala and El Salvador, who expressed concern over the potential contamination of shared freshwater bodies such as the Güija lagoon and the Lempa River. The latter is the main water source for San Salvador, the Salvadoran capital.

In a recent meeting between the Salvadoran Foreign Affairs Minister, Alexandra Hill, and the Guatemalan ambassador to El Salvador, Rubén Estuardo Nájera, the former expressed her concern over the mine.

Yet, Bluestone has said that the mine’s development plans include a cyanide destruction process to neutralize it, which should ease such concerns.


A chance for a sustainable mining future

Indigenous and rural communities in Guatemala have opposed the extraction of natural resources on their lands without their consent or benefit, leading to controversies and conflicts in the mining sector for decades.

The new government of President Arévalo has pledged to reform the mining sector and ensure that it contributes to the social and economic development of the country, while respecting the rights and interests of the affected populations and the environment.

The revision of the mining licenses and the environmental impact assessments is a first step in this direction, as it could help to identify and correct any irregularities or deficiencies in the previous processes. It could also provide an opportunity for dialogue and consultation with the stakeholders involved, including the mining companies, the civil society organizations and the local communities.

By doing so, the government could foster a more transparent, accountable and sustainable mining sector that benefits the country and its people, while minimizing the risks and impacts of the extraction activities.

Source: Mining Review 

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