January 16, 2013 / 3:57 AM / in 5 years

CORRECTED-Colombia to prohibit mining in gold-rich northern area

(Corrects Jan. 8 story to clarify that any impact on Eco Oro not yet clear; adds company reaction, government source)

BOGOTA, Jan 8 (Reuters) - Colombia will create a wilderness park and prohibit mining in an environmentally sensitive region that is rich in gold and silver, the government said on Tuesday.

The decision to create the park in the nation’s northeast effectively rules out any mining in an area of close to 12,000 hectares (30,000 acres) in Santander province, the environment ministry said in a statement.

Canada’s Eco Oro Minerals Corp and other mining companies could be affected by the decision, depending on the parameters of the national park. Its limits and coordinates are expected to be revealed this month.

A government source, who asked not to be named, told Reuters that the ruling may impact Eco Oro’s plans to mine in the area. But the Vancouver-based company said that until the geographic limits of the wilderness park are clear, any talk of whether its project would be affected is speculative.

Eco Oro, formerly known as Greystar Resources, had faced opposition from local authorities in Santander province as well as from environmental groups.

They say its Angostura project is a threat to the delicate Andean ecosystem of Santurban, a so-called “paramo” area believed to be the source of rivers and streams that supply water to 2.2 million people in Colombia.

The company has said its mine would pose no risk to the environment.

Angostura has 10.2 million troy ounces of measured and indicated gold reserves and 3.4 million of inferred resources, with 74 million ounces of silver reserves and resources, according to preliminary studies. (Reporting by Bogota Newsroom; Editing by Peter Galloway)

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