Colombia may require environmental licenses for mining exploration

The comments from minister Susana Muhamad during a mining conference in Cartagena come as extractive companies sound the alarm over a proposed $5.6 billion tax reform they say would negatively affect the industry.

Colombia currently only requires environmental permissions for projects in the exploitation and production phases.

“I think we must put an environmental license for exploration … because there are also lots of conflict and a lack of control over mining exploration processes,” Muhamad said.

“That would help exploration be firmed up in a better way, there can be dialogue and regulation mechanisms and joint work between the government, the companies and communities,” she said.

Another licensing process would slow already sluggish permissioning, an industry source said, and present a new obstacle to exploration for minerals like copper, key to the renewables transition touted by leftist President Gustavo Petro.

“Exploration projects have a period of between eight and 18 years during which companies invest millions in resources without any certainty of finding a deposit,” the source told Reuters. “An environmental license would extend those time-frames and de-stimulate key investment.”

The government is not against mining, but does want it to be carried out strategically, mines and energy minister Irene Velez told the conference.

Her ministry has begun a process of reorganization in a bid to clarify existing laws and revise a mining code in place since 2001, she said.

The 25 trillion peso tax reform, meant to fund ambitious social programs, would levy a 10% tax on income earned when coal and oil are exported for prices exceeding a certain threshold, though a bid to include gold exports may be withdrawn.

The threshold for oil would be $48 per barrel, while coal exports would see the duty levied when prices exceed $87 per tonne.