The Canadian company Caliber Mining withdrew from three applications for mining concessions in Nicaragua after the sanctions imposed yesterday by the United States Department of the Treasury on the Nicaraguan gold business, according to three documents published by the Ministry of Energy and Mines (MEM) in The Gazette No. 200 this Tuesday, October 25, 2022.
The areas requested for mining are located in the municipalities of Waspam, Bonanza and Rosita, in the Autonomous Region of the North Caribbean Coast (RACCN) of Nicaragua. The first canceled concession was called KAKAU and covered an area of 34,369.59 hectares; the second was YALAM with an extension of 49,997 hectares; the third and last is TANGNI with an area of 41,325 hectares.
Although the cancellation of the request for these three mining concessions by Caliber Mining was formalized before the MEM on June 15 and 17 of this year, the regime decided to publish them until October 25, one day after the sanction of the Joe Biden administration to the Nicaraguan gold business.
Related news: Why did the US sanction the gold business in Nicaragua? Here the reasons
These cancellations were made on the eve and the day that the United States issued sanctions against the Nicaraguan Mining Company (Eniminas) on June 17, but the decision of the Canadian company that operates in the country had not been known.
Caliber Mining reviews gold sanctions
A public statement of the company available on its website, notes that “it is proactively reviewing recent sanctions and has communicated with the United States Department of the Treasury to ensure full compliance with these provisions.”
The company highlights that it has a “commitment to continue complying with all relevant international laws and restrictions,” including the economic restrictions of the United States against the Nicaraguan gold business that could extend to other sectors of the national economy and that would affect the foreign direct investment.
Caliber Mining assures that “it will provide a market update once it has additional information, after discussions with its advisers and the United States Department of the Treasury.” Caliber Mining Corp. is a Canadian company that has been operating in Nevada and Nicaragua since 2009.
The sanctions
In 2020, foreign sales of crude gold in Nicaragua reported 665.9 million dollars, an increase of 33.60 percent, displacing beef and coffee, the country’s main export products. According to statistics from the Center for Export Procedures (Cetrex), gold shipments amounted to 807 million dollars in the period January-November 2021, 34.6% higher than two years ago.
In 2021, the shipment of that metal from Nicaragua to the United States rose by thirty percent, totaling more than $744 million. These exports represented 79% of all gold shipments from Nicaragua during the year.
This exponential increase in gold exports led the Joe Biden administration to sanction in June of this year, just four months ago, the state-owned Nicaraguan Mining Company (Eniminas), a company created in 2017 to increase the participation of the regime in the gold business through joint ventures with the private sector.
To evade US sanctions, the regime ordered the General Directorate of Mines (DGM), an office that reports to the Ministry of Energy and Mines (MEM), to manage most of the mining operations in the country on behalf of the dictatorship of Nicaragua. The US Treasury applied this Monday, October 24, sanctions against the DGM because it is an “important piece” in gold transactions in the Central American country.
“Ortega and his cronies continue to use the profits from the production and sale of gold to line their own pockets and pay those who keep the regime in power,” explains the US Treasury.
The gold numbers
In Nicaragua, mining operations occupy 8.3% of the national territory, that is, 9,833.26 square kilometers until the year 2020 with 274 concessions, according to official statistics from the MEM. Another 116 concessions have been requested for the exploitation of 16.11% of the national territory, equivalent to 19,175.98 square kilometers of surface. Official figures indicate that 48,391.59 square kilometers of the national territory are suitable for mining activity, that is, 40.66% of the country.
Income from extraction rights and surface mining rights in Nicaragua left the country, between 2007 and 2020, a total of 4 thousand 531 million 651 thousand 785.45 córdobas. In 2020 alone, income was received in the order of 671 million 160 thousand 726.17 córdobas.
This amount was divided as follows: 35% in transfers to the municipalities, 31% to the National Treasury (Ministry of Finance), 15% to the Mining Development and Promotion Fund, 10% to the Mining Surveillance and Supervision Fund, and 9% to the Atlantic Regional Councils.
