A bill has been presented in the Guatemalan Congress to amend 30 articles of the Mining Act. Among the changes is the creation of a state mining company which may participate in public or mixed investments.
"If Congress approves the amendments to the Mining Act, the voluntary agreement will legislate to increase royalties on mining companies which currently stands at 5 percent for the exploitation of gold, 4 percent for silver, 3 percent for nickel and 1 percent for construction materials", reports Elperiodico.com.gt.
It also introduces mechanisms for community consultation prior to the granting of exploration permits and the establishment of a Mining Council comprising of representatives from the Ministry of Energy and Mines, the Extractive Industries Guild (Gremiex), the Ministry of Planning and Programming Presidency (Segeplan) and the Ministry of Environment and Natural Resources (MARN).
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The Ministry of Energy and Mines in Guatemala has proposed changes to 33 of the 80 items in the original bill, including the creation of a State Mining Company.
Within the project to reform the Mining Law, the Ministry of Energy and Mines (MEM) has included the creation of a State Mining Company, operated by the Government. The percentage of government involvement in the company has not been established.
The mere announcement of the draft constitutional reform in Guatemala so that the State can participate as a partner in mining companies has brought down the shareholder value of Tahoe Resources by 22%.
An article in Elperiodico.com.gt reveals the uncertainty and the damage amonst investors and businesses caused by the announcement of reforms to the Constitution that would include authorization for the State to participate by holding up to 40% of the shares belonging to companies engaged in metal extraction.
"The state’s challenge is to modernize the mining industry sector ", said Eric Clay, Minister of Energy and Mines in Guatemala.
Diálogo Libre interviewed the Minister of Energy and Mines regarding the reforms to the current mining law, and the interview was published by Prensalibre.com.
While waiting for the new mining law, the future Minister of Energy and Mines is negotiating a increase in payments to the State, which currently stand at 1%.
Erick Archila, the newly appointed Minister of Energy and Mines of the government of President-elect, Otto Perez Molina, who will take office on January 14, said that they are holding meetings with various sectors, including the Extractive Industries' Guild, with whom they will negotiate the royalties.