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Laos: Govt sets mining investment criteria to maximise benefit
Financial and technical standards have been set which investors are required to fulfil if they want to invest in mining ventures in a move to maximise the national benefit from the projects.
Minister of Energy and Mines Dr Khammany Inthilath recently signed the instruction on the standards for mining exploration and survey investment.
The standards have been set ahead of the expected opening of mining investment proposals next year. The Prime Minister’s Office recently issued an announcement suspending consideration for all new investment proposals and extension proposals for phased-out projects.
According to the instruction, an investor proposing to invest in the exploration of precious metals – gold, silver, and platinum needs to declare available finance of US$10 million at a minimum.
Less valuable metals require lower declared minimum capital, which is specified in the timetable of the six-page instruction, which has been posted on the Lao Official Gazette: https://laoofficialgazette.gov.la/.
However, the investors need to double the amount of the declared finances during the survey proposal period.
Investors or companies proposing to invest in the exploration and surveying of minerals must have at least five-year experiences in mining projects. Inexperienced investors are required to hire experienced experts or companies to operate the projects, according to the instruction.
The required financial and technical standards are to ensure that proposed investors have sufficient finance and professional capability to carry out the projects in order to maximise the benefits of the country’s mineral resources.
It came after reports emerged that some concessionaires did not have sufficient capital or technical capability to implement projects effectively, while some investors just booked projects for reselling.
Such issues have resulted in poor implementation and in some cases severely polluting the environment of nearby communities. At the same time, some projects were not carried out or were implemented too slowly contravening the concession agreements.
The government told the National Assembly in June that it has revoked investment licenses of 82 projects covering various fields after investors violated agreements. Common violations were no action taken, slow implementation and reselling the projects without the government’s permission.
The Ministry of Energy and Mines is optimistic that the new instruction with its set standards will restrict the booking of projects for resale or transferral without the government’s authorisation.
The government, since several years ago, has suspended consideration for new mining investment proposals after learning of issues surrounding the projects and hoping the pause would allow the authorities to regulate the problems. However, mining projects whose minerals are essential for domestic consumption are authorised for investment and excavation.
Recently, the Prime Minister’s Office issued the latest announcement asking the Ministry of Planning and Investment to suspend consideration of all new mining investment proposals including projects for essential minerals. The suspension, which is imposed until the end of 2020, applies to new investment proposals and extension proposals for expired concession projects.
The announcement said the suspension was to give the authorities time to review previous project implementations.
It is expected the government will welcome new mining investment proposals next year, a senior official at the Ministry of Energy and Mines, who has worked closely with the Ministry of Planning and Investment, told Vientiane Times yesterday.
Source: http://www.vientianetimes.org.la/freeContent/FreeConten_Govt_180.php