Enami EP to create unfair competition, says Azuay mining chamber chief

Friday, February 5, 2010

The recently created national mining company in Ecuador, known as Enami EP, is going to create unfair competition in the sector, Azuay province mining chamber president Patricio Vargas told BNamericas.

"The law's design and the privileges that it gives the national mining company create unfair competition; this is heading straight for state control of all mining activity," he said.

Vargas believes that the advantage the law gives Enami EP over private companies "is unfair" and says that if the company wants to develop projects it should do so under the same conditions as other mining companies.

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"Enami EP was given all the mining concessions for areas that had been filed away for later, and will have rights to projects that companies give up in the future. It has preferential rights for developing any deposit. Only when Enami EP decides it doesn't want a certain project do the rest of the companies get a chance at it," he said.

In mid-January President Rafael Correa signed a decree creating the state company, which will focus on managing non-renewable natural resources that are affected by mining in order to ensure they are used in a sustainable way and be present in all stages of mining activity.

It will also work with large-scale miners to help develop major mining projects both alone and in conjunction with other mining companies.

Azuay is located in the Andes mountains in southern Ecuador and is known for its mineral wealth. Cuenca is the capital city of Azuay.