Ecuador Could Hold Promise for Gold Miners

Writing for Sprott’s Thoughts, Henry Bonner comments that Steve Todoruk of Sprott Global Resource Investments believes a revival may yet be in store for Ecuador’s mining sector.

His optimism relates to the fact that the country’s president, Rafael Correa, has announced plans to revise mining taxes and regulation codes.

Todoruk states:

Legendary mining investor Ross Beaty, founder of Pan American Silver Corp., is already acting on the assumption that Correa will favorably reform the country’s mining laws.

Beaty is known for his outstanding track record in South America. He announced in June that he would acquire a controlling interest in Odin Mining and Exploration Ltd through a $5,000,000 private placement at $0.06 a share1. Odin owns an attractive gold property in Ecuador, which saw some promising drilling results in the early 2000’s while owned by Newmont.

Though this project is in Ecuador, investors have been following Beaty’s lead, pushing the share price of Odin up to its current level of C$0.39 (it went as high as C$0.70 on July 30)2.

Odin isn’t the only company from Ecuador that’s worth watching.

Two companies have recently discovered a promising new mineral deposit. The two companies, Cornerstone Capital Resources Inc. (which we also visited in 2006) and Solomon Gold PLC had continued their exploration work while interest in Ecuador had waned.

Their new copper-gold discovery comes at a time when Ecuador could be becoming a more attractive jurisdiction.

Hot off the press comes word that another one of the most successful mining entrepreneurs, Lucas Lundin, has announced that one of his companies, Fortress Minerals Corp., has reached an agreement with Kinross to buy the Fruta del Norte deposit for C$240 million.

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