Muri Brasil Ventures Inc. (MBVI), the company granted a controversial permit for mineral surveying in the ecologically fragile New River Triangle, yesterday defended exploration of the area while signalling that mining will bring “unimaginable” benefits.
With MBVI almost virtually guaranteed up to 18 prospecting licences upon application, the company said in a statement that such permission is normal and needed to assure investors of a potential return.
In its first statement on the week-old controversy, MBVI said that it was clear that the Cabinet and government are behind the Permission for Geological and Geophysical Survey (PGGS), raising further questions as to why Natural Resources Minister Robert Persaud did not tell a parliamentary committee and GHRA at two separate meetings in November and December about this. The GHRA had asked specifically if the survey would lead to prospecting and was told by Persaud that it wouldn’t. “In response to a first question from the GHRA whether this survey would lead to granting of prospecting licenses, we were assured that the survey carried no such implications. With respect to a second question on the geo-political implications of the survey – given the strategic nature of ‘rare earth’ – we were again assured that there were none. No mention was made of the firm Muri Brasil Ventures Inc. nor the details of the Permission for Geological & Geographical Survey,” the human rights body asserted in a statement last week.
The military has advised against mining in the south east of Guyana and the area is seen as ecologically fragile.
Under the PGGS, signed in November last year, Persaud granted the company the exclusive right to occupy the area and conduct geological and geophysical surveys for rare earth elements, bauxite, limestone, nephelene, syenite, gold, diamonds and granite stones in South East Berbice for a period of 36 months from November 7, 2012.
The key clause of the PGGS also provided that anytime during the duration of the permission, Muri Brasil Ventures Inc shall have the right to apply to the Guyana Geology and Mines Commission (GGMC) for, and shall be granted a maximum of 18 prospecting licences once it satisfies attendant requirements. It said too that the GGMC shall treat such applications on “a priority basis.”
The company, which was granted the PGGS after responding to a publication inviting proposals for exploration of rare earth elements in the area of Muri Mountain, explained that it is awaiting permission to construct an airstrip to facilitate the airborne aspect of the surveys. It, however, noted that other research activities have taken place.
It defended the controversial clause guaranteeing it up to 18 prospecting licences, saying that it is needed since the investors required some measure of security. The company said that it will be at least ten years before mining takes place.
“It is normal for a PGGS to contain a clause granting the permission to the holder the right to apply for a number of prospecting licences,” the statement from MBVI said. “This is not the only Permission which has been granted or which so provides…These kinds of exploration activities cost millions of US dollars which can only be sourced as exploration investments from outside of Guyana,” the statement said. “No such investments would be available if the investor is given no assurance that he will be granted prospecting licences. The investor takes a risk. If he/she is not assured of a potential return, investment capital will dry up and so will Guyana’s mining industry,” the statement said.
Contrary to earlier reports in Stabroek News that the MBVI permit was one of a kind, in 2007 Prime Minister Sam Hinds signed a PGGS for Pharsalus Inc. for the exploration of gold and rare earths. It was observed that that PGGS also had a clause allowing, upon certain conditions being met, up to 20 prospecting licences for radioactive materials and rare earth elements. However it was unclear whether the circumstances for that venture were similar to those of MBVI, in terms of the border security and ecological considerations.
MBVI also noted that a prospecting licence does not necessarily lead to a mining licence because minerals in commercial quantities may not be available. The company made a distinction between exploration and prospecting, saying, “Much has been made of the fact that the area covered by the PGGS is some 2 million acres. This area is for exploration not occupation or prospecting.” It said that it takes several years for a prospecting licence to move to mining licence and this comes only upon satisfying stringent conditions, including Environmental Impact Assessments (EIAs).
Also the PGGS provides that the area is reduced by one quarter at the end of every year for its life of three years so that at the end of the three years only 25 percent of the original area remains. The area for a prospecting licence is an average of 12,000 acres so that 18 prospecting licences will extend over about 216,000 acres.
Gov’t committed
The company said that the fact that Minister of Finance Dr Ashni Singh, in the 2012 budget presentation (not 2013 as reported in yesterday’s edition), spoke of the mining of rare earths is testimony that the venture is not a secret one and that the government was committed to the process. “The Government has been committed to promoting these activities so the PGGS cannot be characterized as a whim or secret deal by the Minister when clearly the Cabinet and Government are behind the PGGS,” it noted.
The statement singled out newspapers, including Stabroek News, for what it said was a campaign against the minister and the project, with the areas of criticism constantly shifting. “These accusations are unfair and do not stand up to scrutiny,” the company said. “We hope that this controversy is not allowed to adversely affect the PGGS granted to the Company. Overseas investment funds in Guyana’s mining industry and in exploration will dry up. Imagine what investors will think when they read about this controversy,” it warned.
Even though former senior members of the Guyana Defence Force spoke at length of the efforts made to guard against mineral exploration in sensitive areas such as the New River Triangle, MBVI emphasised the potential economic development that mining could drive. “Both the Government, the past Minister responsible for mining (the Prime Minister) and the current Minister, have been very supportive of the mining industry because of the enormous benefits that they bring to Guyana and our people. They do not see any part of the territory of Guyana as off limits to the people of Guyana merely because of unjustified claims by neighbouring countries. They are also aware of the view, whether they support it or not, that one way of securing our borders is not to leave it empty but to populate it by residents or development activities which is exactly what is being done,” it argued.
The company said it regretted that what has been at all times a mineral commercial exercise conducted openly and lawfully, in strict accordance with the Mining Act and accepted practices, is now being demonised, presumably in an attempt to attack the minister. “The Company is completely apolitical, and has no agenda whatsoever except to invest in Guyana and bring prosperity to our people in a pioneering venture,” its statement said.
Elections link
Meanwhile, eyebrows have also been raised about the disclosure that Muri’s Brazilian co-owner appeared on a PPP/C platform in Lethem shortly before the November 2011 general elections at a controversial event which saw the government of the Brazilian state of Roraima declaring support for the re-election of the PPP.
It has been revealed that co-owner of Muri Brasil Ventures Inc., Yucatan Reis, a national of Brazil, appeared on the PPP campaign platform in Lethem together with the Governor of the State of Roraima José de Anchieta Junior in November 2011. According to sources, Reis is the owner of Excel Minerals, a gold trading and money transfer business at 6th and Light Streets, Alberttown.
In a press release on Monday regarding Reis’ appearance with the PPP, main opposition APNU said that the situation was akin to “a clear and present danger.”
“The scandalous events unfolding that involve the Minister of Environment and Natural Resources Mr. Robert Persaud is a matter of concern for all Guyanese, and must be seen as a clear and present danger to our National Security and the preservation not only of the pristine environment of the New River Triangle, but more importantly, the territorial integrity of Guyana,” the company said. “The Granting of Permission for Geological and Geophysical Survey (PGGS) to Muri Brasil Ventures Inc. might seem innocuous on the surface, but a deeper examination of the parties involved makes it even more sinister,” it said.
“A Partnership for National Unity notes that one of the persons listed as a Director of the Company – Muri Brasil, is Mr. Yucatan Reis. One would recall that in the 8th November 2011 issue of the Kaieteur News, a photograph was printed showing the (Brazilian) Governor of the State of Roraima addressing a People’s Progressive Party (PPP) rally at Lethem- Upper Takatu- Upper Essequibo Region. In that Kaieteur News photograph standing next to the Brazilian Governor Jose de Anchieta Junior, on the PPP platform is Mr. Yucatan Reis,” it said.
“The question that now springs to mind is whether (for) support of the PPP campaign [he] was handsomely rewarded with the granting of the PGGS. The question also arises as to the involvement (if any) of the Brazilian Governor of the State of Roraima in this nefarious scheme to sell off Guyana,” said the APNU statement. “The People’s Progressive Party’s financial empire and the failure of the Ramotar administration to be open and transparent are now being exposed for all to see,” the statement said.
Stabroek News understands that this APNU statement was sent only to the Kaieteur News on Monday under instructions of the unnamed person who provided the information to the party.
The opposition intends to press for the PGGS to be rescinded. Leader of the Opposition David Granger said that the President in his capacity as Chairman of the Defence Board could pull back the PGGS on consideration of the Board’s longstanding policy not to allow any exploration activity in security sensitive areas.
