Ecuador Revokes Environmental License for Canadian Firm’s Loma Larga Gold Project Amid Environmental Concerns

Azuay, Ecuador – October 4, 2025

The Ecuadorian government has revoked the environmental license granted to Canada’s DPM Metals, halting development of its controversial Loma Larga gold project in the Andean province of Azuay. The move follows months of intense opposition from local communities and environmental authorities who warned that the project threatened one of the country’s most vital water reserves.

In a statement released on Friday, Ecuador’s Ministry of Environment said the decision was based on technical reports from local agencies in Cuenca and Azuay, which oversee drinking water and irrigation systems. The ministry cited the precautionary principle and the government’s obligation to protect water sources, public health, and what it termed the rights of nature, a concept enshrined in Ecuador’s constitution.

“The evidence presented by environmental and local authorities justified the revocation,” the ministry said, adding that water preservation in the Quimsacocha highland ecosystem remained “non-negotiable.”

The Loma Larga project, located within a 3,200-hectare páramo (high-Andean moor) region, was expected to produce nearly 200,000 ounces of gold annually in its first five years of operation. The development represented an estimated $419 million investment by DPM Metals, which acquired the project in 2021.

However, residents and environmental activists have long opposed the mine, arguing that drilling in the ecologically sensitive area could contaminate streams that feed Cuenca’s main water supply. The city’s municipal government welcomed the revocation, saying it was a victory for “the people’s right to water and life.”

In August, the Ecuadorian government had already suspended mining activities at the site pending submission of an acceptable environmental management plan, even after a construction license was initially granted in July. Friday’s decision makes that suspension permanent.

The setback adds to growing uncertainty over Ecuador’s mining sector, where several projects have been stalled by court rulings and community resistance. Currently, only two large-scale mining operations remain active in the country.

DPM Metals has not yet commented on the government’s decision or whether it intends to appeal.

Analysts say the case highlights Ecuador’s shifting environmental policy, which increasingly prioritizes conservation and indigenous rights over extractive investment. It also serves as an indication of the rising influence of local communities in resource governance across Latin America.

Source: https://www.reuters.com/sustainability/climate-energy/ecuador-revokes-environmental-license-canadas-dpm-develop-gold-project-2025-10-04/?taid=68e1d1280c05c30001848351&utm_campaign=trueAnthem:+Trending+Content&utm_medium=trueAnthem&utm_source=chatgpt.com