Untapped Gold Reserves in Ecuador

Lost, Hidden & Untapped Gold Reserves in Ecuador
Ecuador is famous for its natural beauty and abundant mineral resources. Like its neighbors – Colombia and Peru – Ecuador is blessed with favorable geological characteristics that make it a perfect area for gold mining.

The Andes Mountains hide an abundance of mineral wealth. These rugged mountains run north/south through the entire country. Dense, isolated jungles are present in the lower elevations. There are many locations throughout Ecuador with a history of gold.


History of Gold Mining in Ecuador


Much of the gold present in the country was buried until the Spanish came in the 16th century. In search of the yellow metal, the explorers, in large numbers, settled along the rivers in the southern region of Ecuador.

The coastal province of El Oro is the place where the Spaniards and Incas converged to discover and mine gold. The most popular mining towns for this purpose were Portovelo and Zaruma.

Incas were the first to use hydraulic mining to wash away overburden and extract gold. The mines at Zaruma in Southern Ecuador were perhaps the richest in the entire country. The locations of these old mines were the first place that Spaniards focused their attention.

To learn the history of gold mining in Ecuador or to study the rich past of Zaruma itself, one can visit the town museum.

Mining continued in this area for centuries. In 1870s two companies were founded – the Great Zaruma Gold Mining Company and Southern American Development Company (La SADCO) – were established to extract gold throughout the El Oro Province.

The mining company La SADCO had a good run, but in the 1950s the company was dissolved due to increasing costs, labor struggles, etc. While it was in operation, the company mined close to 3.5 million ounces of gold.


Gold: A Glimmer of Hope for Ecuador


Ecuador is a country of contrasts. It experiences drastic weather swings due to its high altitude and proximity to the equator. According to a World Bank report, in 1994 as much as 35% of the people lived in poverty and another 17% fell in the highly vulnerable-to-poverty category.

In contrast, the upper 20% alone controlled more than half of Ecuador’s total wealth. Despite its tag as nature’s treasure-trove, nothing substantial was done to take full advantage of the mineral deposits.

Other countries in the region made the best possible use of their gold reserve when the price of the metal was a record high. The interest in gold mining which was tapering since 1950 almost came to a complete halt after the turn of the century.

Notwithstanding the relatively low-cost factor, the mining activities in Ecuador stagnated and no new permits were issued due to disputes with the mining companies over a heavy tax on excess profit and benefits sharing.

It was not until 2015, the government decided to get its act together and use modern exploration methods to extract valuable minerals like gold and use it for the public good.

The challenge going forward will be whether or not Ecuador’s vast mineral wealth will be used for the good of the people. The extensive mineral deposits could be a blessing for the people, but we have seen so many examples around the world where only a few at the top benefit while the people continue to struggle. Only time will tell what holds true for Ecuadorians.


Major Gold Mining Projects in Ecuador


Some expects say Ecuador ranks among the top five countries that have the best prospective mining jurisdiction in the world. The government has taken a slew of measures to attract foreign investment in gold mining. This has attracted the attention of the world’s largest mining companies. Ecuador is expecting billions of dollars as direct investment in its mining sector in the coming years.

Already, reports of new researches, discoveries, and reserve estimates are emerging from Ecuador every year. Several projects are already underway, making the grand total of 36 commercial mining projects in the country. The Pacto, La Bonita, and Nanguipa Gold-Copper projects are some of the largest in the country.

The Fruta Del Norte Project – one of the largest in the continent – is located in the gold-rich Zamara Chinchipe region. Experts believe that the mines here house approximately 4.8 million ounces of the yellow metal, and with an annual output of 300,000, the reserves could last for a decade and a half.

Also Read: How to Build a Homemade Sluice Box


Ecuador is Literal ‘Gold Mine’ for Gold Prospectors


Ecuador could witness the repeat of the ‘California Golf Rush’ on its soil. It’s common knowledge that there is huge potential for mining gold in the rivers of Ecuador. Much of it remains unexplored and unexploited.

Although in comparison to its neighbors, Ecuador has been slow in tapping its gold deposits, large companies have shown little interest in mining the alluvial gold deposits in the country. Instead of river beds, large companies prefer areas with large scale deposits that can be conveniently mined using heavy equipment.

The northwestern province of Esmeraldas has for many decades served as a rich source of beach placers containing very fine gold. The gold that the coastline offers is extracted using techniques such as highbanking and suction dredging.

In addition, the river beds of the Cayapas River, and above it, the Santiago River, are fed by water sources that are rich in gold deposits. In the absence of any mining activity, these river beds are good hunting grounds for gold prospectors.

The Andean gold that’s washed down from the mountains after storms has supported the local economy, especially the Quechua people who live along the river banks and practice gold panning.

Next: How to Identify Gold in Nature