Monday January 25, 7:46 pm Eastern Time
INTERVIEW-Bolivia mining
outlook looks sour in '99
By Robert S. Elliott
LA PAZ, Bolivia, Jan 25 (Reuters) - Bolivia's mining exports
and investment are set to slip in 1999, continuing a three-year slide brought on by shaky
international financial markets and low metals prices, a leading industry figure said Monday.
Mineral exports based around zinc, lead and silver are expected to dip at least seven percent this
year against the government's preliminary 1998 estimate of $430 million, said Rolando Jordan
Pozo, secretary general of Bolivia's association of medium-sized miners.
''It will be difficult for us to hit $400 million,'' Jordan told Reuters in his downtown La Paz office.
Mineral shipments account for a big chunk of Bolivia's exports, which reached $1.12 billion in
1998, according to official preliminary numbers. In 1997, mining exports hit $492 million, but
tumbling international metals prices have cut returns.
Bolivia's richest mine is Kori Kollo, run by U.S. firm Battle Mountain (NYSE:BMG - news),
which produces at about 300,000 ounces of gold a year.
''External conditions have not helped us at all,'' said Jordan. ''The fall in investment will
continue.''
Mining sector investment is expected to be no more than $40 million in 1999, down from $58.8
million in 1997 and $82 million in 1996, said Jordan. Cash flow for junior miners has been
pinched given the industry's damaged revenues and the BRE-X salting scandal.
Three years ago there were 54 companies exploring in Bolivia, with 45 of them from Canada,
South Africa and Australia, said Jordan. Now there are seven junior miners still in Bolivia, with
four actually drilling.
Investment in 1999 will be earmarked for two key projects, he said. First and foremost is the San
Cristobal silver-lead-zinc deposit, which will top off its feasibility study this year to the tune of
$20 million to $25 million. Cayman Islands-based Apex Silver Mines Ltd. (AMEX:SIL - news),
the sole owner, has tagged the project as potentially one of the largest silver mines in the world.
Located in the southern Potosi district's high plateau, San Cristobal is due to open in late 2001
with total investment of $327 million. The deposit, boasting proven and probable reserves of 509
million ounces of silver, is about 75 miles (120 km) southeast of the Cerro Rico, one of the
world's richest-ever silver loads.
Remaining 1999 investment will go into Don Mario, a copper-gold find with promising grades
located in eastern Santa Cruz. Close to finalizing the property's feasibility study, Canadian junior
miner Orvana (Toronto:ORV.TO - news) and Bolivian partner Emusa SA envisage total
development cost at $50 million.
''This year they'll begin with the difficult task of financing,'' said Jordan.
Two other projects with promise are the medium-sized San Bartolome silver and tin deposit,
tucked behind the Cerro Rico and run by U.S. miner Asarco, and the San Bernardino gold find in
central Oruro, where Australian copper giant BHP is exploring along with Orvana.
Feasibility studies are complete at San Bartolome but the project is on stand-by, presumably
because of dreary financing possibilities, said Jordan.
Bolivia's ability to attract more investor interest in the future will hinge largely on whether the
country can find a large money pit, said Jordan.
''This country is not as interesting as Argentina, Peru and Chile where they have already got
world-class deposits,'' he said.
''San Cristobal is large-scale, but it has low grades,'' he added.
In a Catch-22, discovering an attractive strike requires large-scale exploration and investment, he
said.
''For so long we have been talking about this country's great potential and how Bolivia is a
beggar seated in a chair of gold, but we haven't found it yet,'' Jordan said.
More Quotes
and News:
Apex Silver Mines Ltd (AMEX:SIL - news)
Battle Mountain Gold Co (NYSE:BMG - news)
Orvana Minerals Corp (Toronto:ORV.TO - news)
Related News Categories: US Market News
and chit I got ORV.TO TO find this news and no news from GE still on the pinks really making my !@!@@##@#! day.
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