Guatemela extractive sector projects

History of projects

The Guatemalan Ministry of Mines and Energy’s website provides a brief history of mining in the country and more in-depth look at the current state of exploration and extraction activities. It offers geographical breakdowns of active and pending licenses by jurisdiction and by mineral, and industry-related government and non-government resources. Tables on mining licenses are featured below.

Close to 90% of the earnings generated from mining came from the foreign sales of its extracted metals since 2005, according to the Ministry of Energy and Mines 2008 annual report. The majority of this revenue comes from gold production, in part because of its value. Over 225 000 troy ounces of gold were produced and exported in 2007. Between 2006 and 2007, gold represented just over 81% of the total export revenue of all mined metals. Nearly 3 million troy ounces of silver were produced during the same year, representing just over 18% of the country’s total metal exports. The remainder was nominal and came from foreign sales of antimony, iron and lead.

In 2007, Guatemala experienced a 75% revenue increase over the previous year in its exported mineral resources and related products. The total export revenue in this sector reached $223M US form the previous year’s total of $127.5 M US

Calcite, basalt and silica represented the highest gross national earnings for non-metals in this sector; however, almost all the production was sold nationally with only a nominal amount of silica exported.

Active mining licenses (March 2009)

RECONOCIMIENTO
EXPLORACIÓN
EXPLOTACIÓN
TOTAL
MATERIALES CONSTRUCCION
0
6
95
101
METALICOS
0
114
27
141
NO METALICOS
0
16
137
153
TOTAL
0
136
259
395

Source:Ministerio de Energia y Minas 2008 annual report

Pending mining licenses (March 2009)

 
RECONOCIMIENTO
EXPLORACIÓN
EXPLOTACIÓN
TOTAL
MATERIALES CONSTRUCCION
0
80
108
188
METALICOS
2
100
12
114
NO METALICOS
4
32
45
81
TOTAL
6
212
165
383
 

Source: Ministerio de Energia y Minas 2008 annual report

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Canadian companies

HudBay Minerals

HudBay Minerals' 7700 acre Fenix project is located in El Estor, 170 km northeast of the capital on banks high above Guatemala’s largest lake. According to the company, it sits on “world-class nickel reserves” totaling over 40 million tonnes, which, by its estimates, would make it viable for over 30 years. The project is presently dormant, however. The company is seeking to address controversial land claim issues and human rights abuses. These issues stemmed from INCO’s association with the country’s previous autocratic regimes and the security forces employed by the previous land-owners. (INCO has since been purchased by HudBay Minerals.) The issues are further complicated by recently publicized events stemming from the company’s attempt to evict and relocate locals they claim are occupying the site illegally. Click here for more information.

Goldcorp

Goldcorp holds exploration licenses located in fourteen villages throughout the country. Their controversial Marlin mine is located in the greater municipalities of San Miguel Ixtahuacán and Sipacapa in the country’s western highland department of San Marcos. In an April 2009 address to the Greater Toronto Marketing Alliance titled “Building Trade and Investment Links in the Americas,” the Honourable Peter Kent, Minister of State of Foreign Affairs (Americas), cited that Vancouver-based Goldcorp had become the “single-largest source of revenue” for the Guatemalan government.

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Oil and gas

Industry Facts

  • over 100.00 MMbls accumulated production;
  • peak production in 2003 was 25,000 barrels/day;
  • 153 drilled wells, 58 of which produce oil;
  • the majority of the oil produced in Guatemala is heavy (API 16°, and 6% sulphur content);
  • It is sold at an average 66% of the international price of oil (WTI).

In its mandate to become self-sufficient, the Government of Guatemala is committed to increasing the country’s production of oil. Some industry insiders speculate self-sufficiency could be established in as few as seven years. The government plans to accomplish this by increasing the drilling of the known reserves in Peten to 100 000 barrels/day—reserves which are estimated to last approximately 20 years. It has also committed to increase exploration efforts to promote production of over 200 000 barrels/day and expressed the desire to construct a refinery to offer refined products to the Central American region.

Areas that the government has made available for tender are situated in two regions, which contain nine onshore and three offshore blocks up for lease. They areas are expected to raise as much as $235 million in exploration-related investments. The leases for these blocks are for 25 years and will likely require at least six years of exploration to develop. The offshore blocks total over one million hectares off the county’s Pacific coast. Reports suggest that many occurrences of methane hydrates exist in the continental slope of the Pacific Basin, evidenced by various wells that were drilled in 1979 and 1982. In the Northwestern part of the country, in the Peten mining region, there are over 230 000 hectares that the government has proposed for exploitation.

Perenco is a Canadian oil and gas company that has been operating on Guatemala’s Atlantic coast since 2001. Its holdings within the country include the 430 000 barrel capacity Piedras Negras terminal. This terminal processes and dispatches an average of twelve vessels per year of crude from its Xan and Rubelsanto fields. The company’s La Libertad refinery has a 5 000-barrel-a-day capacity and produces light crude for Xan and asphalt for the Central American consumer market. As part of its social responsibility program, Perenco runs a community reforestation initiative. It oversees the growing of trees in nurseries and their subsequent planting. In 2008, it sponsored and supported the planting of an estimated 300 000 trees.

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