Overview
AndeanGold has been active in Ecuador since the date of the Company's incorporation. The Company controls presently, through wholly owned subsidiaries, a 100 percent interest in 7 granted concessions, comprising four distinct projects, in Ecuador, approximately 14,866 hectares.
On April 18, 2008, the Ecuador Constituent Assembly passed a Mining Mandate (the "Mandate"), which, among other provisions, provided for the suspension of exploration activities for 180 days, or until a new Mining Law is enacted; the revocation of mineral concessions in protected areas; and the cancellation of all mineral concession applications in process.
In June 2008, the Company was notified by the Ministry of Mines and Petroleum ("MMP") that all of the Company's concession applications were cancelled, pursuant to the provisions of the Mandate. The cancellation notices involved twenty-three (23) concession applications. Total expenditures on the cancelled concession applications amounted to $111,214, which the Company wrote off in its consolidated financial statements for the year ended March 31, 2008.
On November 18, 2008, the Company learned that the MMP, in accordance with Article #1 of the Mandate, had posted a list of concessions on its website setting forth the Government of Ecuador's intention to archive any concession without an approved Environmental Impact Assessment and/or without any investment as of December 31, 2007. As a result, four additional concessions previously granted to the Company by the MMP were cancelled, comprising three projects and 15,032.85 hectares. In addition, two projects under option by the Company from a third party concessionaire, comprising one concession each and totalling 4,399.99 hectares, were also cancelled by the MMP. Total expenditures on the cancelled concessions amounted to $499,758, which the Company wrote off in its consolidated financial statements for the year ended March 31, 2009.
In January 2009, Ecuador's National Assembly passed a new Mines Law. The MMP has up to 180 days to draft specific mining regulations for the implementation of the new law, which would then have to be approved by the National Assembly and the President. Once the regulations are finalized and approved, concessionaires will have 120 days to negotiate new contracts with the MMP to have their concessions comply with the provisions of the new law. The Company's three principal projects, Curiplaya, Molleturo and San Bartolomé, as well as the optioned Telimbela project, appear not to be affected by the new Mines Law in terms of continued tenure by the Company. The majority of the Company's expenditures in Ecuador in 2007 and 2008 have been concentrated on its three principal projects.
AndeanGold's concessions are located in southern Ecuador, a highly prospective region that is currently host to a number of projects. These include, among others, Kinross' Condor Project, IAMGOLD's Quimsacocha Project, International Minerals' Rio Blanco and Gaby Projects and Dynasty Metals & Mining's Copper-Gold Belt, Zamora Project.
AndeanGold's principal properties in Ecuador are the Curiplaya Project, a gold-copper porphyry system, the Molleturo Project, a high-grade polymetallic vein system and the San Bartolomé Project, a high-grade polymetallic vein system. NI 43-101 Reports were prepared for the Curiplaya and Molleturo Projects with AndeanGold's TSX Venture Exchange listing on January 12, 2007.