Thursday, February 19, 2009

Pacific Rim freezes study on mining in El Dorado

Vancouver-based Pacific Rim Mining Company announced on February 11 that it will defer completion of its feasibility study for mining in El Dorado. The volatility of costs (both fuel and steel prices are down, meaning current capital prices appear artificially low) does not currently provide an accurate estimate on commodity prices and capital equipment.

CEO Tom Shrake said, “We see no need to spend precious capital to complete a study with an already invalid cost basis. We will wait for clarity on the timing of our permit and stabilization of the prices for capital and operating inputs.”

On December 9, 2008, Pacific Rim filed a Notice of Intent against the Salvadoran government, claiming that failing to grant an extraction permit violated investor rights under CAFTA-DR. It has received much resistance because of the serious health and environmental implications mining has on communities including the prospect of dislocation. The Salvadoran Government and Pacific Rim have until March 9, 2009 to settle the dispute amicably before Pacific Rim has the right to bring the issue before a third party.

To read the article in Mining Weekly, click here.

To read more about the background of the issue, see SHARE’s E-newsletter.

-Leslie O'Bray, Grassroots Education and Advocacy Intern

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