This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Mining And Oil Boom Propel Investment In Colombia

Both projects have run into regulatory hurdles, however, as people who live near the gold deposits object to the planned use of cyanide in open pit operations in both La Colosa and Angostura. They fear contamination of local water supplies.

"Colombia has to weigh the long term, maintaining the country's biodiversity and vast water resources, with the short term, which is the issue of mining," said Manuel Rodriguez, Colombia's first environment minister from 1994-98.

La Colosa alone would require the removal of 600,000 tons of earth daily to extract the gold fragments dispersed underneath the surface â¿¿ meaning 90,000 tons of cyanide and 250,000 liters (66,000 gallons) of water per hour to distill the precious metal.

Still, it's never been a better time to be in the gold business. The precious metal's price has reached unprecedented heights, now selling for more than $1,200 an ounce.

What Colombia's investment boosters don't like to dwell on, however, are questions of security.

The country's nearly half-century-old conflict with leftist rebels still simmers and sometimes boils over, especially in rural areas where mining and energy exploration tend to occur.

Historically, Colombia's illegal armed groups have exacted "war taxes" from mining and oil producers. Those that refused were attacked.

In 2001 alone, the 480-mile Cano Limon pipeline was hit by 170 acts of sabotage blamed on rebels. The attacks were curbed beginning in 2002 under Uribe, when Colombian military units began guarding the pipeline, said Mauricio Tellez, spokesman for state-owned Ecopetrol, which operates the pipeline.

But not all the protection is by legally constituted forces.

"The recent mining boom â¿¿ exploration and exploitation activities â¿¿ has been accompanied by the arrival of illegal security groups," said Ariel Avila, a researcher at the Nuevo Arco Iris think tank.

Avila said he's found in field studies over the last two years that illegal armed groups linked to far-right militias and leftist rebels are providing security for oil companies in several regions, especially in the southeastern states of Meta and Guaviare.

3 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
GSL $5.40 0.00%
XOM $83.58 0.00%
AAPL $123.25 0.00%
FB $83.30 0.00%
GOOG $548.34 0.00%

Markets

DOW 17,712.66 +34.43 0.19%
S&P 500 2,061.02 +4.87 0.24%
NASDAQ 4,891.2190 +27.8570 0.57%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs