Cabanas, Mining

Pacific Rim Notifies NYSE Amex of its intent to Delist

Pacific Rim announced today that it is voluntarily delisting itself from the New York Stock Exchange. This is the latest sign of the companies financial troubles stemming from their failure to obtain exploitation permits to mine gold at their El Dorado site in Cabanas. Here is the press release from the Pacific Rim website:

PACIFIC RIM NOTIFIES NYSE AMEX OF ITS INTENT TO DELIST

Pacific Rim Mining Corp. (“Pacific Rim” or the “Company”), has filed a notification with NYSE Amex Equities (“NYSE Amex”) to voluntarily delist its common shares from the exchange. The Company’s common shares will continue to trade on the Toronto Stock Exchange (“TSX”) and once delisted from NYSE Amex, will automatically trade on the Over the Counter Bulletin Board in the US. As the Company remains a Securities and Exchange Commission (“SEC”) registrant, it is concurrently commencing a listing application for the Over the Counter QX (“OTCQX”) platform, a more rigorous OTC trading platform option available to SEC-registered issuers.

On November 12, 2009 the Company announced it received notice from the NYSE Amex that, based on its review of the Company’s fiscal 2010 first quarter results, the Company was not in compliance with Section 1003(a)(iii) of the NYSE Amex Company Guide, having at July 31, 2009 stockholders’ equity of less than $6,000,000 while sustaining losses from continuing operations and net losses in its five most recent fiscal years. The Company submitted a Compliance Plan (the “Plan”) on December 11, 2009. On February 11, 2010 the Company announced it had been notified by NYSE Amex that the Plan had been accepted. Details of the NYSE Amex notifications are provided in the Company’s news releases #09-09 and #10-02 dated November 12, 2009 and February 11, 2010 respectively.

The Company’s Plan included several key milestones, the most critical of which was to improve shareholders’ equity through a financing based on one or more of receipt of the El Dorado permit, resolution of the CAFTA action or the acquisition and exploration of a new project. The mid-plan milestone of increasing shareholders’ equity to a minimum of US $6 million has not been met and as a result the Company believes it is not meeting the terms of its Plan. Furthermore, the Company is not able to ascertain with confidence whether it will be in a position to regain full compliance with the NYSE Company Guide by the end of the Plan period (May 2011) as the majority of the factors on which ongoing compliance would be predicated are outside of the Company’s control.

The Company’s strategy over the past few months has been to work towards obtaining resolution of the permit issue before raising capital in a weak market to avoid diluting shareholders. The Company continues to try to negotiate with the El Salvadoran government in order to obtain the mining permit, which is expected to enable the Company to raise capital more efficiently to develop the El Dorado project and continue with additional exploration in the Americas while minimizing dilution. In addition the Company is searching for new exploration projects that will benefit its shareholders.

While the acquisition of a new exploration project is currently being pursued, the level of financing, on that basis alone, required to regain compliance with NYSE Amex’s Company Guide would, in the opinion of management, be onerous and dilutive to existing shareholders. Rather, the Company believes that if and when it is successful in acquiring a new exploration project, its financing requirements should be based on its exploration objectives and value objectives rather than the objective of the NYSE Amex.

Lastly, as the Company has greatly reduced its level of business activity at a time when listing costs and standards continue to escalate, management believes ongoing listing on NYSE Amex is not currently practicable.

To effect the delisting, the Company intends to file with the Securities and Exchange Commission a Form 25, Notification of Removal from Listing and/or Registration, on or about August 30, 2010. The Company expects that trading of its shares on the NYSE AMEX will be terminated on or about September 9, 2010. Until the AMEX delisting becomes effective on or about September 9, 2010, the Company’s common stock will continue to trade on the NYSE AMEX under the symbol “PMU” with “.BC” after its trading symbol to reflect its non-compliance with the NYSE AMEX listing requirements.

About Pacific Rim
Pacific Rim is an environmentally and socially responsible exploration company focused exclusively on high grade, environmentally clean gold deposits in the Americas. Pacific Rim’s primary asset is the high grade, vein-hosted El Dorado gold project in El Salvador. The Company also owns several similar grassroots gold projects in El Salvador and is actively seeking additional assets elsewhere in the Americas that fit its focus.

On behalf of the board of directors,
“Thomas C. Shrake”
Thomas C. Shrake
President and CEO

For further information contact the Company at 604-689-1976 or 1-888-775-7097 or general@pacrim-mining.com or visit http://www.pacrim-mining.com

Cabanas, El Salvador Government, Mining

The Government of El Salvador files New Objections with the ICSID Tribunal

On August 3, the attorneys defending El Salvador in Pacific Rim’s claims before the International Center for Settlement of Investment Disputes (ICSID) submitted another round of preliminary objections, challenging Pacific Rim’s right to file a claim under CAFTA.

Pacific Rim sought arbitration in 2009, claiming that the Salvadoran government violated their rights under the local Investment Law and Chapter 10 of the Central American Free Trade Agreement (CAFTA-DR). In January of this year, El Salvador’s attorneys filed a first round of preliminary objections, arguing that even if the facts are accepted as true the Government did not violate Pacific Rim’s rights. On August 2, the panel rejected those objections. This latest round of objections, challanges Pacific Rim’s right to file a claim under CAFTA. Their first argument is that Pacific Rim abused the arbitration process by changing their nationality just to file a claim under CAFTA. From December 2004 through December 2007, Pacific Rim was registered in the Cayman Islands, which is not a signatory to CAFTA. Communication between the Ministry of the Environment, which reviews applications for environmental permits, and Pacific Rim ended in 2006, long before “Pacific Rim Cayman’s nationality was changed from the Cayman Islands to the United States.” El Salvador argues that because the entirety of the events being considered took place before Pacific Rim was registered in the United States the court ought to dismiss their claims.

El Salvador’s second argument is based on the denial of benefits provision of CAFTA. They argue that while Pacific Rim Cayman filed the suit, the interested party is really Pacific Rim Mining Corporation, which is registered in Canada. El Salvador also argues that Pacific Rim Cayman has no real investment interests in the United States, and therefore should be denied the benefits of CAFTA arbitration. Similarly, the Government’s third arguement is based on the principle of ratione temporis, which states that a Court only has jurisdiction for actions or crimes that occur after a statute comes into force. El Salvador believes that because the facts and events leading to arbitration took place before CAFTA came into force, Pacific Rim is barred from making a claim under CAFTA. Their final argument is that Pacific Rim’s claims based on the Investment Law ought to be dismissed because Article 15 of that law does not constitute consent to jurisdiction as required under Article 25 of the ICSID convention.

Since the process began last year, the Government of El Salvador has given little indication as to its strategy or its willingness (or lack thereof) to negotiate a settlement. On August 2, after the tribunal announced their decision on El Salvador’s initial preliminary objections, Tom Shrake said “with this phase of arbitration now completed, we hope to resume a mutually beneficial dialogue with the GOES to resolve the impasse on the El Dorado project.” When El Salvador filed a new set of objections just a day after these comments, they sent a clear signal that they were in no mood to resume a dialogue, and instead were digging in for a long fight that could get very expensive for Pacific Rim.

Cabanas, El Salvador Government, Mining

Pacific Rim’s ICSID Claim Lives to See Another Day

This morning Pacific Rim Mining Co. announced that yesterday the ICSID (International Center for Settlement of Investment Disputes) tribunal denied the Government of El Salvador’s preliminary objections that sought to dismiss most of the mining company’s claims.

In April 2009, Pacific Rim filed international arbitration proceedings against the government of El Salvador claiming that their denial of mining exploitation permits violated their rights under the Central American Free Trade Agreement and Salvadoran Investment Law. In January of this year, the government filed preliminary objections requesting that the tribunal throw out most of Pacific Rim’s claims. They argued that even if all alleged facts are accepted as true, the tribunal still does not have a legal basis on which to decide in Pacific Rim’s favor. (Click here for a summary of the oral arguments). The tribunal heard oral arguments over these preliminary objections on May 31 and June 1, 2010, and yesterday released its decision denying the government’s request.

The tribunal’s decision does not mean that Pacific Rim is necessarily any closer to securing mining permits – only that their ICSID claims will live to see another day. In Pacific Rim’s press release, the company’s President and CEO states “We are very pleased with ICSID’s decision on the Preliminary Objection.” He continues, “[t]his is a positive and crucial step in the CAFTA process for PacRim. We are, however, reticent to celebrate, as we believe a more productive outcome is possible for both the Salvadoran people and foreign investors. With this phase of the arbitration now completed, we hope to resume a mutually beneficial dialogue with the GOES to resolve the impasse on the El Dorado project.”

In filing their claim, Pacific Rim is seeking to recover the $77 million they have invested in exploring their El Dorado site in Cabañas, El Salvador, as well as damages. In his statement, however, Tom Shrake seems to indicate that in trying to negotiate a settlement they are still working to secure exploitation permits. At this point, however, it seems very unlikely that Pacific Rim or any company buys their Pacific Rim El Salvador subsidiary will be able to mine for gold anytime soon. Public support for mining in Cabañas is so low that even Mayor Bautista (once a Pacific Rim promoter) from San Isidro, the municipality where the El Dorado site is located, has expressed his opposition to their efforts.

Investors are apparently not too impressed with the ICSID decision. Pacific Rim’s stock closed at $0.17 a share yesterday and is currently selling for $0.16.

While Pacific Rim’s ICSID claim may live to see another day, the likelihood that they will be resuming their activities in the region are slight.

Advocacy, Cabanas, Corruption, Mining, violence

One Year Anniversary of Marcelo Rivera’s Assassination

On June 24th hundreds of people gathered in San Isidro, Cabañas to honor the life of Marcelo Rivera. Exactly one year earlier many of the same people had been searching for the missing Rivera only to find him tortured, hidden, and dead at the bottom of a local well. Before his body could be properly identified, employees at the coroners office were ordered to bury his body in a common grave – but his brother and another friend demanded to be escorted there and dug the grave out themselves. The attorney general still maintains that Marcelo’s death is a common homicide, despite glaring disparities between the report and the original autopsy. Luis Quintanilla, a Catholic priest who has been threatened and attacked himself, demands justice in this video clip.

Cabanas, International Relations, Mining

Interview with Antonio Pacheco, Director of ADES

On June 8th, the CEO of Pacific Rim mining company, Thomas Shrake, spoke before a Canadian congressional committee about his experience with the El Dorado mining project in Cabañas, El Salvador.  The congressional committee was debating the Bill C-300 that proposes oversight of the government’s investments into international mining projects.  The committee invited Mr. Shrake to testify as an example of why the bill is needed to protect Canada’s reputation abroad.  Mr Shrake’s testimony argued against the Bill and demonized the sectors of Salvadoran society that have opposed the company’s projects in their communities.  Here we provide a response from the community association, ADES, targeted in Shrake’s testimony.

Interview with Antonio Pacheco, Director of ADES:

ROSIE: We’re here with Antonio Pacheco, the Director of ADES, and we have reviewed the comments made by Thomas Shrake to the Canadian Congressional committee on June 8, 2010. I’d like to ask, after reviewing these accusations against ADES, how do you perceive what he has said?

ANTONIO:  Mr. Shrake’s objective was to create a strong impression in the Canadian Congress, to the end that they will not approve a law that controls the behavior of Canadian businesses. Mr. Shrake accuses us of promoting violence, but in reality, the authorities of this country know very well that ADES had nothing to do with these acts, and that ADES is very removed from this type of event.  ADES has done nothing to cause violence in the area of Cabanas.

ROSIE: So, why do you think it was in Mr. Shrake’s interest to make this type of accusation against your organization?

ANTONIO: He tries to paint ADES as the devil, and to make himself into the victim of our actions. He tries to make an impression on the Canadian public that they are the victims of an attack from a Salvadoran organization, and that the Salvadoran government has done nothing to prevent this type of action.

ROSIE: So, what is the real history of ADES? What’s the organization’s mission?

ANTONIO:  ADES is a community organization, comprised of campesinos and campesinas, dedicated to agriculture and community organization. Its focus is community development. This mission leads us to oppose a project like mining exploration, which is so environmentally devastating. Before we knew about the damage caused by mines, we thought it was a good project because of the employment opportunities and development that it could bring. However, our position changed when the people effected by Pacific Rim’s initial exploration came to our office to ask for help and accompaniment. The population, coming to their own conclusions, had already tried to denounce the project through the municipal government, the attorney general, and prosecutor’s office, but these organizations didn’t pay any attention to their complaints.

From this point, ADES began to get involved in this issue. The first thing we had to do was investigate the issue, and we realized that effectively in Central America and Latin America there had been a lot of damage caused by mining companies.  We are convinced that our vision, which is sustainable development, including the rational use of natural resources, is the best way to improve our standard of living.  So, due to this situation, specifically the persistent increase of mining exploration throughout the department, and the continuous complaints of the population, we decided to accompany them by raising awareness of the potential damages, scientific research with outside experts, and to begin to bring the issue onto the national stage. We decided to bring the issue to politicians, to the Salvadoran Congress, ministers, and the church, while respecting the mining industry’s presence in Cabañas.

ROSIE: Mr. Shrake has said that on 2 occasions armed groups attacked his employees and damaged his property, along with other incidences of violence, and he says that ADES is responsible for all of these violent events.

ANTONIO: Frankly, we don’t know where this accusation; that we have acted in a planned manner with armed groups, is coming from.  We are a social organization, legally constituted, and we focus on peaceful advocacy. We understand the detrimental impact that this type of activity could cause on our area, where we work and live with our families. We make it very clear that it is not our political practice to use violent means, as Mr. Shrake suggests.

ROSIE: So, ADES is going to prepare a more detailed response to these accusations, and we will await this document.

ANTONIO: Of course ADES will respond to the accusations of the president of Pacific Rim, so that the citizenry, not only in El Salvador but also in USA and Canada can hear our point of view.

Mining

Pacific Rim v. El Salvador: The Tribunal Begins

Here’s the latest from Tom Shrake and Pacific Rim:

Pac Rim Cayman, LLC (“Pac Rim” or the “Company”), a Nevada corporation and a wholly-owned subsidiary of Pacific Rim Mining Corp. (TSX: PMU)(NYSE Amex: PMU) (“Pacific Rim”) has received notice from the International Centre for Settlement of Investment Disputes (“ICSID”) that the three nominations for arbitrators in the Company’s action under the Central America-Dominican Republic-United States of America Free Trade Agreement (“CAFTA”) and the El Salvadoran Investment Law have all accepted their appointments. As a result, the Arbitral Tribunal is therefore deemed under ICSID Arbitration Rule 6 to have been constituted. For additional information about Pac Rim’s claims against the Government of El Salvador see Pacific Rim news release #-09-03 dated April 30, 2009 or its 2009 Annual Report.

“This is a key milestone in Pac Rim’s claim as the arbitration process will now get fully underway,” states Tom Shrake, CEO. “The next step is for the Arbitral Tribunal to convene a hearing to set out the further procedures in the arbitration. The shareholders of Pacific Rim can rest assured that although the arbitration will proceed as quickly as possible, we continue to maintain a dialogue with the Government of El Salvador to find a resolution to our dispute to the benefit of both parties. Pacific Rim has worked with both local residents and their elected officials, and the Government of El Salvador, to design a mine plan for the El Dorado deposits that sets new environmental protection standards for Latin America. We are committed to responsible mining that can put the people of Cabanas back to work in these extremely difficult economic times. El Salvador has tremendous gold wealth that can be translated to jobs and economic prosperity in the poorest region of the country in a safe and responsible manner.”

About the Company

Pacific Rim is an environmentally and socially responsible exploration company focused exclusively on high grade, environmentally clean gold deposits in the Americas. Pac Rim’s primary asset and focus of its growth strategy is the high grade, vein-hosted El Dorado gold project in El Salvador. The Company owns several similar grassroots gold projects in El Salvador and is actively seeking additional assets elsewhere in the Americas that fit its project focus. All references to “Pac Rim” or “the Company” encompass the Canadian corporation, Pacific Rim Mining Corp, and its U.S. and Salvadoran subsidiaries, Pac Rim Cayman LLC, Pacific Rim El Salvador, S.A. de C.V., and Dorado Exploraciones, S.A. de C.V., inclusive.

On behalf of the board of directors,

Thomas C. Shrake, President and CEO

Forward-Looking Information

Information set forth in this document may involve forward-looking statements. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond Pacific Rim’s control, including: the schedule and commencement date of future arbitral hearings; the outcome of any ongoing discussions with the Government of El Salvador; and the outcome of the arbitration against the Government of El Salvador. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking information. Pacific Rim’s actual results, programs and financial position could differ materially from those expressed in or implied by these forward-looking statements. Readers are urged to thoroughly review the Company’s Risks and Uncertainties as outlined in its 2009 Annual Report.

 

Elections 2009, Mining

Mining and the Presidential Elections: Rep. Rohrabacher, Paul Behrends, and Pacific Rim

Days before El Salvador’s recent presidential elections, a small chorus of Representatives from the U.S. Congress spoke out against the FMLN political party and their presidential candidate Mauricio Funes. Of those that spoke out, Rep. Dana Rohrabacher (R-CA) was one of the most vociferous.

In a speech on the floor of the House of Representatives, Rep. Rohrabacher labeled the FMLN a pro-terrorist political party that has links to Iran, al-Qaeda, the FARC, Cuba, and Hugo Chavez. He added that while Salvadorans are free to vote for whomever they like, if they elect the FMLN, the U.S. should end the temporary protective status (TPS) for Salvadorans in the U.S., and cut off the flow of remittances to El Salvador. Rep. Rohrabacher and officials from the State Department made similar threats during the 2004 presidential elections in El Salvador, contributing to the ARENA’s victory over the FMLN.

Despite the last minute threats, on March 15, 2009 Salvadorans elected Mauricio Funes as their next president. While Rep. Rohrabacher’s comments on the House Floor caused a stir the week before the elections, the media has largely ignored them in their coverage of the Funes victory. Rep. Rohrabacher on the other hand posted a C-SPAN video of his speech from the House floor on the front page of his official website.

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Contrary to Rep. Rohrabacher’s threats, El Salvador’s relationship with the U.S. remains strong. President Obama and Secretary of State Clinton both called to congratulate Funes on his victory, and to schedule meetings with him at an upcoming summit. Funes –a moderate and a party outsider– has reiterated that he will respect trade agreements and international law, seek to stem the flow immigration, and maintain strong ties with the U.S.

Within hours of Rep. Rohrabacher and others making statements regarding the FMLN, thousands of U.S. citizens were calling the State Department to demand a statement of neutrality from the Obama Administration. State Department officials readily obliged by restating their neutrality and willingness to work with the next Salvadoran president. The statements made by Rep. Rohrabacher and others beg the question – do these Congressmen have intelligence or information on the FMLN that the State Department and President do not have, or were other interests in the balance? We propose that the answer may lie in Rep. Rohrabacher’s connections with the Pacific Rim Mining Corporation’s struggle to secure mining permits in El Salvador.   Click here to keep reading

Environment, Mining

Mining in El Salvador – So what’s next?

On March 13, 2009, Pacific Rim posted their Fiscal 2009 Third Quarter Result, in which they state, “[i]n deference to [the] democratic process, Pacific Rim may elect to wait until after the election is decided and then evaluate the post-election climate for mining in El Salvador before initiating CAFTA arbitration proceedings.” 

Recall that on December 8, 2008, Pacific Rim filed a notice of intent to commence international arbitration proceedings against the Government of El Salvador under CAFTA-DR.  Their claim is that El Salvador violated international and Salvadoran law by failing to issue exploitation permits, resulting in significant loss.  Under CAFTA-DR rules, Pacific Rim could proceed with formal arbitration on or after March 9, 2009, which is when the three-month negotiation/cooling-off period ended.

 

So what is Pacific Rim’s next move? (Click here to read on)

pacrim1

Advocacy, Environment

Pacific Rim Freezes Activities; New Archbishop Opposes Mining

The El Dorado gold mine project proposed by the Pacific Rim has been at the center of the debate regarding natural resource extraction in El Salvador.

According to Pacific Rim, a Canadian company, the mine project has widespread local support because of the employment it would provide, and poses no threat to the environment. The project would use the newest and best techniques, and include a water treatment plant.  The practices would be so safe in fact that, according to CEO Tom Shrake, the tailings pond could eventually be used as a reservoir. (See article on Mineweb.)

However, local anti-mining activists, Oxfam America, and the Roman Catholic bishops tell a different story. They say the mine would contaminate drinking water with cyanide, irreparably damage the environment, and produce little economic benefit for local communities. (See article on Upside Down World.)

Because of the politically delicate nature of the issue, the Saca administration –going against its neo-liberal reputation– has refused to grant Pacific Rim the permits necessary to move ahead with the project. In July of last year, Pacific Rim announced a slow down, and that it was laying-off 42 of their 267 employees based in El Salvador until the government granted them the permits. After little response from the government, in December 2008 Pacific Rim filed a notice of intent to seek arbitration under CAFTA regulations for $77 million in indirect appropriation, giving the government until March 9 2009 to respond.

Yesterday (February 16 2009) at the regional forum on metals mining, the new Archbishop of San Salvador, Monseñor José Luis Escobar, declared his opposition to mining because of the danger it poses to the environment and human health. He urged the nation to wait to extract the minerals until the industry develops better technologies and techniques that will not pose these threats.  The archbishop went on to say that he is also concerned with the degree of power that the government grants transnational corporations.

These comments came only 4 days after Pacific Rim announced that it will freeze its feasibility study, citing the current volatility in the costs of inputs such as steel and fuel. They stated that activity will be halted until the market stabilizes, however it is unclear when that will be.