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Ecuador, Kinross hit impasse over Fruta del Norte

Talks between the Ecuadorian government and Kinross Gold have stalled over the country’s largest mine, Fruta del Norte.

The Financial Post reports that Ecuador may not sign an operating contract because Kinross wants to renegotiate terms of a tentative agreement signed in December:

“We think their demands are a bit over the top … there are things that we cannot accept because we cannot break or change the law,” (Energy Minister William) Pastor said. Kinross said it wanted to rework the current deal, under which the company would pay roughly half its income, after production costs, in taxes and royalties.

Ecuador is also in negotiations with Chinese-owned Ecuacorriente over its Mirador copper mine. Together, the two deals are valued at some US$2.8 billion.

The leftist government of Rafael Correa plans to invest $3 billion in the next two and a half years in order to reduce the country’s dependence on oil exports.

Other projects up for negotiations are the Rio Blanco gold-silver project owned by Arizona-based International Minerals (TSE:IMZ)  and IAMGold’s (TSE:IMG) Quimsacocha gold-copper-silver mine.