(Alliance News) - SolGold PLC on Monday said the court in Ecuador has quashed a further attempt to prohibit mining in the country.
SolGold, whose biggest shareholder is mining giant BHP Group PLC, owns a number of exploration projects in Ecuador. These include Cascabel which holds the firm's flagship Alpala prospect.
A petition was filed in Azuay province, in the south of the country, to begin a consultation on banning mining activity within the province. SolGold's Sharug project is in Azuay, and is a project the company believes has "considerable potential for the discovery of a world-class orebody".
The Constitutional Court of Ecuador has rejected the petition, citing technical and procedural issues as well as the principle of non-retroactivity of the law.
"It is clear the Constitutional Court have provided a specific ruling as well as rational arguments to determine the legal rights of existing mining concessions," said SolGold.
"This decision, in conjunction with the previously rejected petitions of a similar nature in both the Imbabura and Azuay provinces, sets a strong precedent for any future petitions for consultation to consider changes to the constitution of Ecuador.
"SolGold continues to work closely with all levels of the Ecuadorean government and with the local communities within which SolGold and its regional subsidiaries operate to create a sustainable and responsible mining industry in Ecuador," SolGold continued.
In June last year, the court rejecting a move to hold a referendum on mining activity in the province in which Cascabel is located, Manabi, in the north-west of the country.
SolGold shares were down 3.3% on Monday in London at 22.10 pence.
By George Collard; georgecollard@alliancenews.com
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SolGold (SOLG)