Peru rescinds Canadian company’s exploration rights

The Government of Peru passed Supreme Decree 001-2021-EM, which overturned a couple of previous decrees that granted Nuevo Arcoiris S.A.C, a subsidiary of Canada’s Tesoro Minerals Corp (TSXV: TES), certain mineral exploration rights. 

The legal instruments that were overturned were Supreme Decrees 027-2020-EM and 028-2020-EM which were issued in 2020 and stated that Nuevo Arcoiris was allowed to acquire and hold mineral rights and other related rights, including surface rights, water rights, and other rights necessary to conduct exploration and further exploitation activities, on 21 mineral rights located near the Tambogrande community, in the northwestern Piura department. 

Since the rights were situated within 50 kilometres of Peru’s national border with Ecuador, a supreme decree granting permission to hold the mining concessions had to be issued by the President of Peru and the Ministerial Council, under Article 71 of the Constitution.

But political and community forces were pushing against mining operations in the mostly agricultural area and earlier this month, the Ministry of Energy and Mines started working on a report aimed at overturning the 2020 decision. 

Congresswoman Angelica Palomino, who was lobbying in favour of the new supreme decree, considered the decision a “victory” for the district, the region, and the country.

“We will no longer allow irresponsible mining to take over agriculture, even if this goes against individual interests,” Palomino, who hails from Piura, tweeted.

In response to this development, Tesoro Minerals issued a statement saying that the executive team is consulting with its Peruvian legal counsel and regulatory advisors “to consider appropriate actions and potential avenues of redress available to the company.”