A final settlement of compensation terms for the nationalization of the Vinto tin smelter in February 2007 is expected to be announced early in the New Year, a Bolivian government spokesman told La Razon newspaper. The deal will also cover the establishment of a joint venture for tin and zinc mining with Glencore’s local subsidiary Sinchi Wayra. The minister responsible for legal issues relating to state assets, Hector Arce, said that “we are on the verge of reaching a favourable and friendly solution with Glencore”.
The mining joint ventures will apply to the Colquiri tin and zinc mine in La Paz department and the Porco zinc, lead and silver mine in Potosí department, and were originally announced in June. The Colquiri mine produces some 2,500 tpy of tin-in-concentrate and until last year all of the mine’s production was treated at the Vinto smelter. The mines are currently leased by Sinchi Wayra from state mining corporation Comibol. The Bolivian government this year announced major investment plans for the Vinto plant, but production has been hampered by financial and management problems. Plant management and the Oruro government are currently reported to be seeking a $23 million government loan to pay off debts for concentrates purchased from the state-run Huanuni mine.
Also in Bolivia this week, the president of the National Federation of Mining Cooperatives (Fencomin), Andres Villca, has warned of a collapse of tin mining activity by its members as prices have dipped below $5.00/lb. Production costs are believed to be between $4.50 – $5.00/lb. Mining Minister, Luis Alberto Echazú told La Razon that the government is considering the establishment of an emergency fund similar to that made available to zinc miners. He also said that productivity improvements at the Huanuni mine had reduced costs there.
