Identifier
Created
Classification
Origin
08LAPAZ918
2008-04-21 22:20:00
CONFIDENTIAL
Embassy La Paz
Cable title:
CHARGE MEETING WITH COEUR D'ALENE BOARDMEMBERS
VZCZCXYZ0021 RR RUEHWEB DE RUEHLP #0918 1122220 ZNY CCCCC ZZH R 212220Z APR 08 FM AMEMBASSY LA PAZ TO RUEHC/SECSTATE WASHDC 7265 INFO RUEHAC/AMEMBASSY ASUNCION 7865 RUEHSW/AMEMBASSY BERN 0171 RUEHBO/AMEMBASSY BOGOTA 5202 RUEHBR/AMEMBASSY BRASILIA 9133 RUEHBU/AMEMBASSY BUENOS AIRES 6355 RUEHBY/AMEMBASSY CANBERRA 0101 RUEHCV/AMEMBASSY CARACAS 3522 RUEHPE/AMEMBASSY LIMA 3758 RUEHMD/AMEMBASSY MADRID 3985 RUEHMN/AMEMBASSY MONTEVIDEO 5406 RUEHNE/AMEMBASSY NEW DELHI 0173 RUEHNY/AMEMBASSY OSLO 0160 RUEHOT/AMEMBASSY OTTAWA 0529 RUEHQT/AMEMBASSY QUITO 6143 RUEHSG/AMEMBASSY SANTIAGO 0817 RUEHKO/AMEMBASSY TOKYO 0363 RUEHWL/AMEMBASSY WELLINGTON 0030 RUMIAAA/USCINCSO MIAMI FL RUEHUB/USINT HAVANA 1068 RHEHNSC/NSC WASHINGTON DC RHMFISS/HQ USSOUTHCOM MIAMI FL
C O N F I D E N T I A L LA PAZ 000918
SIPDIS
SIPDIS
E.O. 12958: DECL: 04/21/2018
TAGS: ECON EMIN EINV BL
SUBJECT: CHARGE MEETING WITH COEUR D'ALENE BOARDMEMBERS
Classified By: Charge Kris Urs for reasons 1.4 b,d
C O N F I D E N T I A L LA PAZ 000918
SIPDIS
SIPDIS
E.O. 12958: DECL: 04/21/2018
TAGS: ECON EMIN EINV BL
SUBJECT: CHARGE MEETING WITH COEUR D'ALENE BOARDMEMBERS
Classified By: Charge Kris Urs for reasons 1.4 b,d
1. (C) Coeur D'Alene CEO Dennis Wheeler, South American
Operations' President Jim Duff, and four members of the Coeur
board of directors met with Emboffs April 21 to express their
thanks for advocacy on behalf of Coeur's San Bartolome Mine
and to discuss the investment and political climate in
Bolivia. Wheeler described the new tax situation (after the
12.5 percent increase of late 2007) as "acceptable but not
reasonable." Duff said that Coeur's legal advisors assure
them that they will not be adversely affected by proposed
legislation currently in Bolivia's lower house that would
increase state control over mining concessions, because
Coeur's concessions are leased from the state mining company
COMIBOL. However, Duff said that the position of the mining
industry is that a clause should be added to the new
legislation that would ensure that the change would not be
retroactive.
2. (C) After a discussion of recent investment-unfriendly
moves by the Bolivian government (including a March 2007
supreme decree that eliminates accelerated depreciation for
mining exploration investments,) Wheeler mentioned that he
felt private U.S. interest in investing in Bolivia is on the
decline: "Even with our project about ready to start, we find
people resistant to the idea that investment is advisable in
Bolivia." Wheeler mentioned that at one point Coeur put all
capital investment in the San Bartolome project on hold for a
year because of doubts regarding the Bolivian government's
plans.
3. (C) In an earlier meeting with Jim Duff, Duff opined that
if the MAS draft constitution were to pass as it is now, it
would be "the end of mining in Bolivia," due to the increased
state involvement and the rights of indigenous groups over
land use decisions. Currently, mining in Bolivia is also
complicated by power and fuel shortages. San Bartolome has
just connected to the national electric grid, and Duff hopes
that San Bartolome's contract with the city of Potosi will
allow it to avoid the electricity shut-offs that Apex
Silver's San Cristobal Mine is already experiencing. In
keeping with predictions we have heard from some other
industry members, Duff predicts electricity rationing within
a year.
4. (C) Although production from the San Bartolome silver mine
was originally predicted to begin in late 2007, a series of
delays have meant that the mine is still not in production
(although Duff said that production was expected to start
"any day".) San Bartolome plans to have an opening ceremony
on May 9th.
URS
SIPDIS
SIPDIS
E.O. 12958: DECL: 04/21/2018
TAGS: ECON EMIN EINV BL
SUBJECT: CHARGE MEETING WITH COEUR D'ALENE BOARDMEMBERS
Classified By: Charge Kris Urs for reasons 1.4 b,d
1. (C) Coeur D'Alene CEO Dennis Wheeler, South American
Operations' President Jim Duff, and four members of the Coeur
board of directors met with Emboffs April 21 to express their
thanks for advocacy on behalf of Coeur's San Bartolome Mine
and to discuss the investment and political climate in
Bolivia. Wheeler described the new tax situation (after the
12.5 percent increase of late 2007) as "acceptable but not
reasonable." Duff said that Coeur's legal advisors assure
them that they will not be adversely affected by proposed
legislation currently in Bolivia's lower house that would
increase state control over mining concessions, because
Coeur's concessions are leased from the state mining company
COMIBOL. However, Duff said that the position of the mining
industry is that a clause should be added to the new
legislation that would ensure that the change would not be
retroactive.
2. (C) After a discussion of recent investment-unfriendly
moves by the Bolivian government (including a March 2007
supreme decree that eliminates accelerated depreciation for
mining exploration investments,) Wheeler mentioned that he
felt private U.S. interest in investing in Bolivia is on the
decline: "Even with our project about ready to start, we find
people resistant to the idea that investment is advisable in
Bolivia." Wheeler mentioned that at one point Coeur put all
capital investment in the San Bartolome project on hold for a
year because of doubts regarding the Bolivian government's
plans.
3. (C) In an earlier meeting with Jim Duff, Duff opined that
if the MAS draft constitution were to pass as it is now, it
would be "the end of mining in Bolivia," due to the increased
state involvement and the rights of indigenous groups over
land use decisions. Currently, mining in Bolivia is also
complicated by power and fuel shortages. San Bartolome has
just connected to the national electric grid, and Duff hopes
that San Bartolome's contract with the city of Potosi will
allow it to avoid the electricity shut-offs that Apex
Silver's San Cristobal Mine is already experiencing. In
keeping with predictions we have heard from some other
industry members, Duff predicts electricity rationing within
a year.
4. (C) Although production from the San Bartolome silver mine
was originally predicted to begin in late 2007, a series of
delays have meant that the mine is still not in production
(although Duff said that production was expected to start
"any day".) San Bartolome plans to have an opening ceremony
on May 9th.
URS