LONDON (Alliance News) - SolGold PLC on Thursday responded to a drop in its share price, saying it has had no indication from the Ecuadorian government that its Cascabel copper-gold project is at risk.
Shares in SolGold were down 6.2% at 31.81 pence on Thursday morning, but dropped as low as 24.26 pence earlier in the day.
There have been reports in Ecuador about a possible referendum on mining in the province where Cascabel is located.
Under Ecuadorian law, individuals can put forward petitions to include questions in a future vote, after which they must gain 10% of signatures from the voting population in the province concerned.
On Wednesday next week, the Ecuadorian Constitutional Court will receive arguments from those who have put forward the referendum, as well as those who oppose it.
The court will then decide if the question on future mining is valid and legal, after which the question must be approved by the electoral council to be included on ballot papers.
SolGold said: "With strong support from the government, the international mining community operating in Ecuador and local communities, SolGold does not expect approval to be forthcoming from either the electorate or the court.
"There has been no indication from the Ecuadorean government that SolGold's tenure is at risk. The Cascabel project is a key project in Ecuador's developing mining industry and a critical driver for the future of Ecuador's economy. SolGold continues to receive full and objective support from the Ecuadorean government."
Earlier in the day, SolGold had announced that initial exploration of its Rio Amarillo project, also in Ecuador, had identified five different prospects in two concessions with significant copper and gold.
The five prospects were identified at concessions Rio Amrarillo 1 and 2, with an extensive 2 kilometre by 2.4 kilometre lithocap found in Rio Amarillo 2.
Rock chip results from in and near the lithocap include hole R01001075, which had 0.3% copper and 0.3 grammes of gold per tonne of ore, as well as 32 parts per million of molybdenum. At hole R01001089, copper was 0.2%, gold was 0.05 grammes per tonne of ore, and molybdenum was 45 parts per million.
SolGold (SOLG)