March 27, 2017 / 4:37 PM / a year ago

Colombia municipality, home of AngloGold project, votes to ban mining

BOGOTA, March 27 (Reuters) - Voters in Colombia’s Tolima province have backed a proposal to ban mining projects in their municipality, a result that raises questions about the future of an AngloGold Ashanti gold exploration in the area.

South Africa’s AngloGold may not be permitted to extract gold at its flagship La Colosa mine - a $2 billion potential investment that could yield 28 million ounces of gold - after 98.8 percent voted against allowing mining in Sunday’s referendum.

AngloGold has been exploring at the site in central Colombia for more than a decade.

Some 6,165 citizens backed the proposal, while 76 voted against, according to figures from the electoral authority.

Residents had previously expressed fears that extraction could damage ground water, but the company says the project will not affect the water supply.

“We regret that because of a badly laid-out debate about mining in Colombia, the country and the region are now at risk of not receiving the benefits of well-done and responsible mining,” AngloGold said in a statement on its website. “We will analyzed the consequences and the impact on the project.”

Commodity producers in Colombia have expressed worries about recent court decisions banning exploration on land already awarded in concessions and giving local authorities greater power to reject mining projects.

AngloGold has invested some $900 million in Colombia since 2006. La Colosa is its largest of three projects in the country.

Officials in Cajamarca were not immediately available for comment. AngloGold said it would comment further later on Monday.

Mining and Energy Minister German Arce told local radio Caracol that the authorities should respect the voters’ decision, but that it is not retroactive.

“You cannot put legal security at risk because these decisions cannot be made retroactive,” Arce said. (Reporting by Julia Symmes Cobb and Nelson Bocanegra, additional reporting by Luis Jaime Acosta; Editing by Dan Grebler)

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