Canadian mining company Dundee Precious Metals (DPM) has received a court decision on the permitting process for the Loma Larga copper-gold underground project in Ecuador.

The Provincial Court of Azuay in Ecuador has announced its decision on the appeal against the Ministry of Environment, Water and Ecological Transition (MAATE).

According to the company, the decision recommended a free and informed consultation of certain indigenous populations by the state, which was already planned under its project development.

It requires an environmental consultation with communities in the project’s area of influence and certain additional reports on the impact of the project on water resources.

In addition, the decision requires consultation of Quimsacocha National Recreation Area by the MAATE, before advancing the project to the exploitation phase.

DPM completed the legal assessment of the decision and sought clarification on the requirements for the additional reports, the indigenous and environmental consultations and the steps needed to resume the planned drilling campaign.

Dundee Precious Metals president and CEO David Rae said: “As we assess the court’s decision, we remain committed to the highest applicable standards for environmental protection and stakeholder engagement in line with International Finance Corporation standards.

“DPM will be engaging with the government to outline the next steps for the consultation activities and, based on the extensive environmental work completed to date, we will work with MAATE to provide any additional detail as quickly as possible.

“We will continue to take a disciplined approach to future investment and advancement of the Loma Larga project based on the receipt of key milestones and the overall operating environment in the country.”

Recently, DPM signed an investment protection agreement (IPA) with the Ecuador government for its Loma Larga gold-copper-silver project.

Under the terms of the agreement, the government has provided the mining company with tax stability and certain tax incentives.

The IPA also grants Dundee Precious Metals legal protections including stability of the regulatory framework and resolution of disputes through international arbitration.

The company will also benefit from incentives including a 5% discount on the income tax rate, fixed at 20%, and tax stability on value-added tax (VAT).

Furthermore, DPM will be exempted from import duties for important machinery for plant and mine facilities at the Loma Larga project.