Posted: ’20-SEP-06 07:00′ GMT – – Archive

Canadian junior nickel miner Skye Resources is rumored to be an attractive takeover target, despite the opposition of hundreds of Mayan protestors who are now illegally occupying Skye lands in Guatemala.

Skye would like to reopen a long dormant nickel mine, which has resurrected longtime hostile feelings Mayans have for the nickel mining. More than 20 Q’eqchi’ Mayan communities are located within the 96 square mile area covered by Skye’s exploration concession.

The project was the former Inco Exmibal nickel laterite mine and smelter. In 1980, the Exmibal plant was shutdown and placed on care and maintenance due to a combination of high oil prices and low nickel prices. By 1992 Inco initiated a feasibility study to look at restarting the Exmibal facility, but a decision was made not to restart.

The Guatemalan Government took back the concessions in December 2004 and re-awarded them to Skye Resources, which has conducted a feasibility study for a 50 million pound ferronickel project. Meanwhile, Inco has maintained a 12.4% interest in Vancouver-based Skye. BHP Billiton also owns 16.5% of the company. The Guatemalan Government also holds a 7.6% interest in Skye.

Last week, the Globe and Mail reported that BHP Billiton, CVRD, and Xstrata are already considering making bids for Skye. Xstrata has recently purchased Falconbridge, while Brazilian iron ore miner CVRD is the clear favorite to acquire Inco.

In a recent interview with Reuters, Guatemala’s Deputy Mining Minister Jorge Garcia said local opposition to mining has reduced the number of metal exploration licenses from 740 to 315 during the past two years. Garcia said communities in general oppose new exploration, especially those companies conducting activities in Mayan regions.

Mayan protestors have opposed Skye’s project for more than a year, claiming local communities were not consulted prior to the government granting the exploration license to Skye. However, Mayan communities have been talking with Skye’s local company, Compañia Guatemalteca de Níquel (CGN).

Last weekend, hundreds of Mayan Indian families have set up camp on Skye lands, demanding the Canadian junior give them land to conduct subsistence farming. More than 1,000 Mayan Indians occupied two different areas within the company’s concession.

In a Tuesday news release, Skye officials confirmed the occupation, but explained that the three parcels of land they have occupied “lie in a valley a considerable distance from the Fenix nickel deposits. The situation on the ground is peaceful and is not affecting project activities, including the on-going drill program. The company has attempted to hold discussions with the representatives of the groups but was not successful. The company will continue to seek dialogue and is also pursuing legal avenues.”

Skye, whose President and CEO is former Placer Dome Executive Vice President Ian Austin, said it has commenced a number of community consultation activities during the past two years. The company also formed a community relations team, which includes seven Q’eqchi’ members. The team has visited 30 communities in the region to determine local concerns. The Canadian junior also helped found Raxche, an NGO focused on improving local health and education. Among its programs are farming projects and the refurbishment of a local school and hospital.

Skye said the project will meet all key international benchmarks, especially the Equator Principles, and comply with IFC Performance Standards.

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