Mining companies and spanish citizens are suing the Panamanian State arguing arbitrary and discriminatory measures imposed by the Martinelli Administration are detrimental to their investments.
The companies Petaquilla Gold, Petaquilla Minerals LTD, and Corporación de Recursos Iberia, S.A. are sueing the Panamanian government for $2.3 billion at the International Centre for Settlement of Investment Disputes (ICSID) of the World Bank for direct damages against the company in Panama and its shareholders, reported Laestrella.com.pa.
Diamante Minerals announced a gold stream agreement for the Molejon Gold Mine, located in the Donoso District, Colon Province of Panama.
From a press release issued by Diamante Minerals:
KELOWNA, BC, Feb. 3, 2016 /PRNewswire/ - Diamante Minerals, Inc. (OTCBB: DIMN), a natural resources company, today announced a gold stream agreement for the Molejon Gold Mine, located in the Donoso District, Colon Province of Panama.
The Supreme Court rejects appeal case presented by Petaquilla Minerals to reverse the cancellation of the concession to exploit the gold mine El Molejón.
The appeals filed by the former concessionaire of Molejón in an attempt to recover the concession and invalidate the tender which was called by the PAN for cleaning tailing basins have been rejected by the Supreme Court.
Petaquilla Gold has been granted 180 days to catch up with outstanding payments of royalties, fees to the Social Security Department and other payments.
From a statement issued by the Ministry of Commerce and Industry of Panama (ICIM):
The Ministry of Trade and Industry announced today, to representatives of Petaquilla Gold, the decision to administratively resolve the granting of the Molejón mining project, recognizing an initial term of 180 calendar days, during which the company can rectify its faults in contractual obligations.
The Securities Commission of British Columbia in Canada, has issued a resolution barring the two top executives of Petaquilla from trading shares of the company until financial information is presented for the period ending July 2014.
Problems continue for Petaquilla Minerals, which breached a salary payment arrangement that should have been finalized in October and it has now been reported that two of its executives have been banned from buying or selling shares in the company.
The Ministry of Labor has retained office goods and the quarry belonging to Petaquilla Gold mining as part of measures to ensure the payment of wages of workers in the mine.
Despite rumors of the stoppage of the extraction process due to lack of capital to continue operations, the mining company is not bankrupt, but owes its employees about $3.5 million. It is expected that by 29th to 31st of October, the company will pay the fees.
The area is seeing new banks, restaurants, hotels and shopping centers as well as a boom in housing construction and the renovation of transport systems.
The Comptroller General of the Republic, has revealed that at the end of 2012 the value of gold exports reached $115.7 million. "So far, the only company in the process of exploitation is Petaquilla Gold, though it is expected that the end of 2016 will see the start of the Cobre Panama project (as it was called by Minera Panama, predecessor in the concession), now First Quantum", reported Laestrella.com.pa.
The conflict between Minera Panamá and Petaquilla Gold over land for mineral extraction in Panama will have to go to international arbitration.
In 2010 Minera Panama, a subsidiary of Inmet Mining, asked the Ministry of Economy and Finance (MEF) to lease 7.453 hectares for the development of an ambitious project to extract copper, bordering the mining concession that the company has had since 1997.
Although the law does not require them to, the two mining companies pay voluntarily royalties of 4% to the Panamanian State.
Both mining companies indicated to Capital Financiero that although there was an amendment to the Code of Mineral Resources in Law 13 of April 3, 2012, their concession contract with the Panamanian state is governed by Law 9 of February 27, 1997 , therefore the changes made to the reform are not applicable to their activity.
Petaquilla Gold, the largest gold mine in Panama, has announced a plant for the manufacture of tiles, bricks and slates based on clay residues from the metal extraction process.
Petaquilla Gold is venturing into the production of building materials to create a clay products factory, Petarcilla SA, which will use waste from the grinding and extraction process at the Molejón gold and silver mine.
As gold becomes an important export item, royalties paid by mining companies remain low.
Gold exports rose by 63% between 2010 and 2011, reaching $85.1 million last year. Petaquilla Gold, owner of the Molejon mine, became the largest exporter in the country.
With the growth of the industry, questions are being asked about the royalties paid to the Panamanian government by these mining companies, currently set at 2% of sales. Davidken Studnicki-Gizbert, an expert in the mining history of Latin America and North America, notes that each ounce of gold costs between $250 and $350 and sells at over $1,500, so a 2% royalty becomes "questionable."
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