All mining activities in Colombia are Governed by the Colombian Ministry of Mines and Energy and by the National Agency of Mining (ANM). These bodies collectively interpret the laws and regulations, and their application to the sector covering the mine permit application through to mine operations, and post mine reclamation.
With that in mind, the awarding of mining titles in Colombia applies the principle of “first-come, first-served”, with the exception of the areas declared by the ANM as being strategic. Whereby, mining titles located within Strategic Mining Areas (SMA) will be awarded through a public auction process lead by the ANM.
Hence a mining title can be secured through:
- Staking on a “first-come, first-served” basis and completing the relevant mine concession application process.
- Winning a bid through the public auction process for areas within a SMA, and/or
- Through direct purchase and subsequent transfer of a mining concession from an existing owner.
In all cases, it’s necessary for the investor to demonstrate sufficient economic capacity to develop the mining project, hence the investors must provide supporting financial statements to the ANM. In future articles more will be provided about this.
Staking “first-come, first-served”
To acquire a concession through staking the investor and/or mining company must first confirm that the area is not already claimed, which can be confirmed through the National Mining
Registry. Once confirmed that the area is not claimed, the next step involves the purchase of a PIN number, which is a unique identifier and allows for the commencement of the process. PIN numbers can only be used for a single application. With the PIN number, you can access the Online Filing Tool of the ANM and can complete the concession application process. After submission, the ANM will confirm whether the requested area is free and also evaluate the technical and legal feasibility of the proposal and then issue a formal decision.
Awarding Titles within Strategic Mining Areas
The National Government has designated 20.5 million hectares as SMA´s. These areas are prospective regions for gold, platinum, copper, iron ore, metallurgical and thermal coal, cobalt: phosphate, potassium, magnesium and uranium.
Concessions within SMA areas will be assigned through a competitive bidding process that will be led by the ANM. The process will use available geological information provided by the Colombian Geological Service, and will be awarded in function with the geological potential in order to guarantee the adequate exploration and exploitation of the mineral resources.
Transfer of concession rights
A concession owner has the legal right to transfer the ownership of a concession to a third party. Due to its private nature, no governmental entity is responsible for the transfer of mining rights as these are agreements between private parties. Therefore, investors are advised to review four key aspects before buying and/or investing in an existing concession:
- Confirm the validity and ownership of the mining title
- Confirm the geographic boundaries of the concession
- Confirm if there are any outstanding financial and/or legal obligations.
- Confirm that the title is not within a prohibited area for mining.
Where can you find more information?
The Biz Latin Hub Group is well positioned to guide our clients through the process to secure a Mining Title and then with developing the project. If you would like to know more about how we can help, please contact our CEO, Mr. Craig Dempsey at [email protected]
If you’re interested in finding out more about opportunities for mining services in Colombia and the rest of Latin America, have a look at our video below!