Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
A Bolivian farmer died on Friday and at least four others were injured when protesters occupied the Malku Khota project, operated by Canadian South American Silver (TSX:SAC) in the Andean highlands, reported Prensa Latina.
Violence spread at the silver mining property on Thursday evening as authorities and indigenous from the Bolivian Andean region, who were holding five employees of the Canadian firm captive, were negotiating a potential deal.
According to Bolivian Interior Minister, Carlos Romero, the death of the Malku Khota’s community member occurred because the person was drunk and accidentally detonated a stick of dynamite. The authority also denied rumours of a confrontation between police and indigenous from Malku Khota, says the article.
On Monday, South American Silver published a statement saying the company was working closely with the authorities from the provincial government of Potosi and national Bolivian agencies to resolve the situation.
“Our first priority is the safety and security of our employees, contractors and all those in the local communities,” said Greg Johnson, President and CEO of South American Silver. “We are working closely with the authorities from the provincial government of Potosi and national Bolivian agencies to constructively resolve the situation and to seek an approach to development that is inclusive of all communities in the project area including the small number that have been opposed to the project.”
Compañía Minera Malku Khota, a subsidiary of the Canadian miner, says that a majority of the indigenous clans in the area – known as Ayllus – support the firm’s project.
South American Silver has invested more than $50 million in the mining project since 2007. Malku Khota is one of the world’s largest unexploited resources of silver and indium, a rare metal used in flat-screen LCD televisions.
Though rich in mineral and energy resources, data from the Unicef shows that Bolivia is one of the poorest countries in Latin America and the weakest economy in all of South America.
Bolivia is a current hot spot for investors as President Evo Morales has been in consultation with local leaders to allow the extraction of resources originally thought to be untouchable.
Read more on Bolivia’s decision to allow foreign companies access >>
