Las Crucitas Gold Mine Receives Seal of Approval

September 2, 2005

AFTER more than three years of conflict between the Costa Rican government and Canadian mining company Vanessa Ventures, including threats by the company of a $276 million claim against the state, Costa Rica’s National Technical Secretariat of the Environment Ministry (SETENA) has approved gold excavation at the Las Crucitas mine, near the Nicaraguan border.On Tuesday, SETENA approved the environmental impact study of the mine, to be operated by Costa Rica-based Industrias Infinito, whose parent company is Vanessa Ventures.SETENA has given Industrias Infinito 30 days to present certain requirements, including making environmental guarantees and promises, regarding the mine before granting the final environmental thumbs-up.The approval comes after three and a half years of study and concern about the possible environmental risk of using cyanide for gold extraction. Last month Vanessa Ventures threatened international arbitration and a $276 million claim if SETENA did not issue a resolution (TT, Aug. 19). Company officials estimate the mine will yield at least 650,000 ounces over 10 years, which, based on price of $435/ounce, equates to $283 million. Las Crucitas is one of two mines declared exempt from the 2002 moratorium on open-pit mining signed by President Abel Pacheco as one of his first acts in office.Industrias Infinito is still awaiting a resolution from the Constitutional Chamber of the Supreme Court (Sala IV) regarding an appeal by the company to reverse the court’s decision in December 2004 to annul the mining concession.Industrias maintains the decision unfairly applies legislation made after the concession was granted.Area environmentalist Carlos Murillo told the daily La Nación local environmentalists are not ready to allow the company to begin mining, but he did not specify what measures they would take.

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