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NEWS: Vancouver company to use UK-Bolivia investment treaty to seek compensation over mine

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A Vancouver-based mining company is attempting to use an investment treaty to claim compensation from Bolivia for revoking its concession to mine for silver and indium (a metal used in flat-screen LCD televisions), an extractive process that would use and pollute scarce supplies of drinking water.

Mining Weekly reports, “TSX-listed South American Silver (SAS) on Tuesday said it had notified the Plurinational State of Bolivia of an investment dispute, after the company’s subsidiaries had lost its mineral tenements. …The dispute arose as a result of acts of the Bolivian government, including the issuance of Supreme Decree No 1308 on August 1. The decree revoked mining concessions held by Compania Minera Malku Khota, a fully owned subsidiary of SAS.”

Agence France Presse reported the “move (by the Bolivian government was) strongly criticized by the Canadian government and foreign investors.”

That news agency has also reported, “Malku Khota is one of the world’s largest untapped resources of silver and indium, a rare metal used in flat-screen LCD televisions.”

A briefing paper on the mine outlines a number of water-related concerns. “From our visit we observed equipment for operations that were occurring on the shore of lake Wara Wara. The community rely on fish that live in those lakes; they draw and consume the water from those lakes. …The community of Mallku Khota is especially important for the main watershed Amazonica, which supplies water to the Amazonian region of the country… We noted during our visit that Mallku Khota is undergoing a process of desertification, and community members confirmed that they struggle with daily water consumption during the dry season. …Further, given that the leeching process requires chemical processing, according to the PEA (preliminary economic assessment), there is the possibility of chemical contamination into the local water supplies…”

Mining Weekly adds, “SAS said it was a protected investor under the bilateral investment treaty between the UK and Bolivia, and the actions of the Bolivian government were in violation of that treaty and of international law. The company said the notification of the investment dispute triggered a six-month cooling-off period during which the disputing parties could negotiate a settlement. If settlement could not be reached within the cooling-off period, SAS said it intended to file for international arbitration under the Arbitration Rules of the United Nations Commission on International Trade Law claiming full compensation based on fair market value of the Malku Khota project.”

More at http://canadians.org/blog/?p=15761.



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