Galway Gold mulls legal escape to Colombia’s mining ban in paramos

Canadian junior miner Galway Gold (TSX-V:GLW) said Wednesday it will study the legal effects of a recent ruling banning all mining activities in Colombia’s paramos, which forces the company to shut down its Reina de Oro operation.

Earlier this month, the country’s Constitutional Court ruled against a controversial legal loophole permitting oil, gas and mining operations in the country’s paramos— high altitude eco-systems that supply more than 70% of Colombia’s population with water.

Galway said the ruling not only forces the company to halt operations, but it blocks it from transferring the project, as the mining permit will no longer be valid.

Galway said the ruling not only forces the company to halt operations, but it blocks it from transferring the project, as the mining permit will no longer be valid.

According to industry sources, there are 36 paramos in Colombia and at least 350 titles in such areas, Galway said in a statement.

“The court appears to be suggesting that mining affects the quantity and quality of water the area produces,” the firm noted.

The ruling has also declared that public interests supersede private interests, which eliminates the ability of the company to sue the Colombian government for damages.

In the past year, Colombia has worked on improving the country’s mining standards. Authorities have adopted a “zero tolerance” stance when it comes to illegal mining and taken steps to expedite permit approvals. They have also tightened regulations to establish a project's area of influence in order to improve mitigation of environmental and social risks.

Other than gold and coal, Colombia holds vast and untapped reserves of emeralds, silver and oil.

Full press release here.