Canada’s Zonte sues Colombia authorities over gold permit rejection

Gramalote hill, by B2Gold and AngloGold Ashanti’s namesake gold project. (Image: B2Gold)

Canadian junior explorer Zonte Metals (TSX-V: ZON) is going ahead with plans to sue Colombia’s Department of Antioquia as it claims the mining authority did not process its exploration application in accordance with the country’s mining code.

Authority says wanted area is too small to become a mine and that it would interfere with AngloGold and B2Gold’s Gramalote project.

The move comes more than three years after Halifax-based Zonte first spotted — and applied for — a licence to mine an area that sits on top of partners’ AngloGold Ashanti (NYSE: AU) and B2Gold’s (TSX: BTO) Gramalote gold deposit.

According to Antioquia’s secretary of mines, the area in dispute — which measures less than 30 hectares — is too small to become a mine, and Zonte’s application would interfere with AngloGold and B2Gold’s project, which has actually been frozen since 2014.

Zonte argues there is no minimum size on land applications specified anywhere in Colombia’s mining code and that there have been several applications accepted where the total area of exploration was significantly smaller, including a recently issued title covering less than 0.1 hectares.

Zonte first considered applying for a Colombian land title in 2013, after identifying a number of narrow gaps between title areas — otherwise known as “fractional” claims — sitting across Gramalote, once touted as Colombia’s first modern commercial scale gold project.

After the rejection, Zonte sought the help of a legal counsel headed by a former director at Colombia’s secretary of mines and it’s now proceeding with legal actions.

Canada’s Zonte sues Colombia authorities over gold permit rejection

The project would sit on top of the Gramalote deposit and surrounding areas. (Courtesy of Zonte Metals)

The company has also responded to an AngloGold Ashanti representative who during a recent presentation about Gramalote said the fractional claims sitting over the deposit were “just stories in the media.”

“Zonte wants to make it clear that these open areas were confirmed by the Secretary of Mines in formal documentation from their review of the application,” it said in the statement.

The company has high hopes for its project, as the adjacent Gramalote, located 110km northeast of Medellin, in the department of Antioquia, is said to hold 2.69 million ounces of gold within 132.7 million measured and indicated tonnes grading 0.63 g gold per tonne, and 3.36 million ounces of the precious metal within 239.7 million inferred tonnes grading 0.44 g gold.