A chat with the government's new director of mining...
WITH GOLD discoveries popping up all over Hispaniola, Alexander Medina, the newly appointed director of mining for the Dominican Republic —which shares the metal-rich island with Haiti—is a very busy government minister. But he was happy to spare a little time to talk to The Gold Report about what his office is doing to ensure that mining companies get the gold carpet treatment under the new administration.
The Gold Report: What is the main job of the director of mining management?
Alexander Medina: I oversee all the mining policies of the Dominican Republic. And I am in charge of granting mining permits and licenses to explore for precious and base metals and minerals.
TGR: What experience do you bring to this job?
Alexander Medina: I have worked in mining operations, mineral processing and management for 35 years. As a chemical engineer, my background is in precious minerals and metals. I worked in the nickel business here in the Dominican Republic.
TGR: Does the new administration of the Dominican Republic support responsible exploration and mining development?
Alexander Medina: Investors and explorers in the Dominican Republic have the full support of the Dominican government. Actually, we are currently improving our processing methods in order to speed up the permitting of mining ventures. I am intent that exploration permits be granted within a few months of application, instead of a couple of years, as has often been the case, unfortunately.
TGR: Will it be easier for junior mining companies to get permits to conduct exploration and then to open up mining operations?
Alexander Medina: It will be easier for exploration permits. The new president of our country, Danilo Medina, has instructed my office to speed up the permitting process for exploration. But licensing a mine for production can be much more complicated than exploring for resources. An environmental permit is required for going onto production, and that can take some time. There are many complex issues involved in making sure that the mines are environmentally safe and sound.
TGR: Can you briefly explain the permitting process, and what a firm has to do to be permitted to explore for metals and minerals?
Alexander Medina: According to Dominican law, all foreign companies must have a local representative, an arrangement with a local company. And that local company can take charge of meeting with mining officials and submit a request for mining exploration license, providing the information necessary to obtain a permit from the government. We go over all of the data presented before determining if the project is a fit.
Under Mining Law 146, the terms of the formal arrangement between the foreign company and the local company must be legally registered with our office, because the venture is subject to taxation. In order to get the concession, the principals in the venture must declare what kind of minerals and metals they are searching for. They must describe in detail the geological features of the geographical area that they wish to explore. That's about it.
TGR: It is estimated that the Dominican Republic has $58 billion (B) in metal and mineral reserves. Do the leading firms have all of the permits that they need?
Alexander Medina: They already have all the permits and licenses that they need for exploration.
TGR: What happens when they are ready to go into production?
Alexander Medina: My office will support them to get any permit they need in order to advance their projects. An application for an exploitation license should be submitted, including a feasibility study proving economics and feasible and proven operations for the proposed project.
TGR: Are there environmental issues? Some local groups are objecting to problems that occurred at Pueblo Viejo. How are you dealing with those issues?
Alexander Medina: All of the environmental issues at the Pueblo Viejo deposit have been addressed by the new operation. The operation is now on the right path.
TGR: What is the difference between the previous administration and the new administration regarding mining?
Alexander Medina: The largest difference is the interest that the new president has in providing full support to investors. We wish to have a transparent permitting and licensing process so that foreign firms and their local partners receive all the help and cooperation from the mining department that they need.
TGR: Are there any new rules and regulations for mining waiting in the wings?
Alexander Medina: There are no new regulations up to now, just a clear attitude to help investors.
TGR: Given some of the historical problems with natural and manmade mining disasters, why should foreign investors feel safe putting their money into firms working in your country?
Alexander Medina: First of all, the Dominican Republic is a very quiet and peaceful country. It is very well organized politically and economically. It has proven time and again that it's a safe place to invest. The Dominican government is very conscientious about protecting foreign investments. We will provide full support to any investor putting capital into the mining sector, or tourism or any other economic area.
TGR: Does the government take a cut of the mining proceeds?
Alexander Medina: We partner with mining firms when the deposits are government-owned. But there is no interest from the Dominican government to partner with investment in the private mining sector. We believe in free enterprise and we have mining laws that protect investors and tax mining the same as any other investment venture in the country.
We are very optimistic about our future, because even though we are a small island, there is lots of mining potential in the Dominican Republic. The ongoing operations that we have talked about have really proved that future is very exciting.
TGR: Thank you for taking the time to talk with us, Mr. Medina.
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