Ecuador’s main export for several decades has been oil. Minerals have not historically constituted a major export of Ecuador, and the first large-scale mines only started production in November 2019, when the Fruta del Norte mine, operated by Lundin Gold through its local subsidiary Aurelian, started producing gold, and the Mirador mine, operated by Chinese Tongling and China Railway through its local subsidiary Ecuacorriente, started producing copper. Both projects are located in the south-east of Ecuador, in Zamora Chinchipe province. It is expected that together the projects will have combined sales of more than USD1 billion per year, an amount which will make mining one of Ecuador’s biggest exports.

On 10 December 2019, the Fruta del Norte mine produced its first export: 177 tons of gold concentrate. A total investment of USD2.7 billion has been made in the project and it is expected to produce 310,000 ounces of gold per year and 400,000 of silver. In 2020, the Mirador project, owned by Ecuacorriente, also started production at the first large-scale copper mine in Ecuador. In June 2024, an exploitation contract was signed for the Cascabel project, making it the third large-scale mining project in Ecuador to transition into the exploitation phase. The construction of the mine is anticipated to commence in the near future.

Ecuador has not yet been fully explored for minerals and its potential has, in recent years, attracted major multinational companies such as Newcrest (now Newmont), Barrick, Anglo American, BHP and Codelco. Although mining activity is fully regulated and legally permitted, political opposition from different groups has meant that investment progress has been slow, delayed by the need to overcome the legal and constitutional objections that are regularly brought against mining projects.

Ecuador’s legal system is a civil one. The main sources of legislation that apply to mining are the Ecuadorian Constitution, the Mining Law and the Environmental Law, plus the regulation applicable to all commercial activity, including the Civil Code, the Labour Code and various tax laws. There are also several subsidiary regulations that detail further the procedures for obtaining and maintaining a mining concession, as well as the full set of requirements governing environmental and social matters.

The Ecuadorian Constitution provides that natural resources belong to the State of Ecuador, that their exploitation shall be conducted in accordance with all environmental and social provisions and that the benefit to the exploiting company shall always be lower than the benefit to the State of Ecuador. It also provides that environmental consultations and engagement between mining companies and indigenous communities shall be conducted in pertinent cases in accordance with the treaties entered into by Ecuador.

The Mining Law and regulations cover all aspects of the granting of a mining concession, payment of maintenance fees, royalties, passing into different stages, including advanced exploration and exploitation, and all other aspects concerned with a mining concession. The Environmental Law and regulations set out all matters regarding environmental licences indispensable for mining activities. The Civil Code is a set of general rules applicable for all matters when there is no special provision for a particular matter. The Tax Code and related laws and regulations also apply to mining activities, in addition to the Labour Code for all employment matters.

All Ecuadorian legislation is applicable to companies operating in Ecuador and therefore all mining subsidiaries holding mining concessions in Ecuador are subject to all the laws applicable in Ecuador. The Constitutional Court of Ecuador has the capacity to qualify requests for public consultation on different matters, including mining matters. Its decisions are binding. While several international treaties provide for consultation with indigenous communities, a law defining to whom, when and how a community consultation should be made has not been passed, in part due to the Constitutional Court prohibiting the issuance of a ministerial decree in that regard.

In March 2023, an Executive Decree was issued regulating the environmental consultation process; however, this Executive Decree will only be in force until the National Assembly issues an Organic Law regulating such consultation.

In Ecuador, mineral resources belong to the Republic of Ecuador. The State of Ecuador has the right to explore and exploit all minerals and it can do this through the national mining company ENAMI (Empresa Nacional Minera). However, ENAMI does not have sufficient financial means and technical resources. Therefore, on the few projects it is handling, it has looked for partners, and is open for new projects through the execution of Commercial Agreements.

The central government acting on behalf of the State of Ecuador is allowed to grant mining concessions for the exploration and subsequent exploitation of metallic and non-metallic minerals. Mining concessions for construction materials are granted by municipalities.

Article 1 of the Constitution mentions that the non-renewable natural resources on the territory of the State belong to its inalienable and imprescriptible patrimony. The central government will have exclusive competence over energy, minerals, hydrocarbons, water, biodiversity and forest resources.

Article 408 of the Constitution mentions that non-renewable natural resources and, in general, products of the subsoil, mineral and hydrocarbon deposits, substances whose nature is different from that of the soil, including those found in the areas covered by the waters of the territorial sea and maritime zones, as well as biodiversity and its cultural heritage and the radio-electric spectrum, shall be the inalienable, imprescriptible and unseizable property of the State. These assets may only be exploited in strict compliance with the environmental principles established in the Constitution.

The State will participate in the benefits flowing from the use of these resources, in an amount that will not be less than that of the company that exploits them. The State shall guarantee that the mechanisms of production, consumption and use of natural resources and energy preserve and recover natural cycles and allow for dignified living conditions. In spite of the fact that all subsoil products belong to the State, the regional autonomous governments in whose territory non-renewable natural resources are exploited or industrialised will have the right to participate in the income received by the State for this activity, in accordance with the law.

The role of the State is always grantor-regulator. Since the State is also the owner of mineral resources, it can operate through its wholly owned company ENAMI, but this is rarely the case. When this does happen, however, the State may be simultaneously grantor-regulator and owner-operator through different government entities.

ENAMI shall have the preferential right to apply to the Ministry of Energy and Mines for the concession to any free mining area, in accordance with the certification issued for this purpose by the Mining Regulation and Control Agency. It shall also have the right of first option to apply for the concessions to areas whose rights have been extinguished due to expiry, extinction or nullity, or which have been restored to the State.

Mining concessions are always granted and regulated by the State, independently of those that are granted to a government-owned company or any other petitioner. Once production starts, the role of the State, in addition to controlling environmental, social and labour matters, is to collect royalties and verify that the rule which states that the benefits must always be higher for the State of Ecuador than for the mining concession holder is satisfied.

The mining sector is structured as follows:

• the sectoral ministry – the Ministry of Environment and Energy (recently the Ministry of Energy and Mines merged with the Ministry of Environment, thus, forming the Ministry of Environment and Energy);
• the Mining Regulation and Control Agency;
• the National Institute of Geological, Mining and Metallurgical Research;
• ENAMI; and
• the municipalities, where they are competent (eg, concessions for construction materials).

ARCOM

Article 8 of the Mining Law establishes the creation of the Mining Regulation and Control Agency (ARCOM) as the technical-administrative body in charge of exercising the State power of surveillance, auditing, intervention and control of the phases of mining activity carried out by ENAMI, and in mixed-mining companies, private initiative, small-scale mining and artisanal and livelihood mining, in accordance with the regulations of this law and its regulations.

ARCOM has the competence to supervise and adopt administrative actions that contribute to the rational and technical exploitation of the mining resource, and to the claiming of the fair share of the benefits by the State as a result of its exploitation, as well as to the fulfilment of social and environmental responsibility obligations assumed by the holders of mining rights.

ARCOM has the following powers and responsibilities, among others:

• to keep a register and cadastre of mining concessions and publish it by electronic means;
• to inspect the mining activities carried out by the holders of mining rights and titles; and
• to grant licences for the commercialisation of mineral substances determined in the present law.

ARCOM also regulates the assignment and transfer of mining rights as well as other industry issues, as it is the regulating entity.

All minerals and products thereof found underground belong to the State of Ecuador, as per the provisions of the Ecuadorian Constitution. The law allows the State of Ecuador to grant a mining concession through the issuance by the central government of a mining concession title, which, subject to the provisions of the law, including environmental laws and regulations, enables the mining concession holder to explore and produce minerals. Mineral rights granted through concessions do not have the status of property, but of rights to explore and produce. Once the minerals are produced, they become the property of the concession holder, who can sell them freely on the market.

Any natural or legal person, national or foreign, has the power to prospect freely for the purpose of seeking minerals, except in protected areas, within the limits of mining concessions, in urban or populated areas, in archaeological areas, in areas declared to be of public utility and in Special Mining Areas.

The President of the Republic of Ecuador may declare Special Mining Areas, subject to Article 407 of the Constitution, in those areas in which there is potential for mining development and which are not concessioned, with the purpose that the Ministry of Energy and Mines, through its attached entities, carry out cadastres, geological-mining investigations or other types of activity of scientific interest, within their respective competencies.

The declaration of a Special Mining Area shall expressly establish the term of validity of the Special Mining Area, which may not exceed four years; once this term has expired, it shall be lifted without the need for any provision that so declares. In all cases, the declaration will respect the legally established rights or those derived from them.

Natural or juridical persons, national or foreign, who are holders of mining rights or who carry out mining activities, are subject to the laws, courts and judges of the country.

Mining Scale

Mining concessions are divided into large-scale concessions, medium-sized mining and small-scale mining.

Small-scale mining refers to operations that, due to the characteristics and geological conditions of the deposits of metallic and non-metallic mineral substances and construction materials, as well as their technical and economic parameters, can be exploited efficiently in a direct manner, without prejudice to the fact that exploration work precedes it, or that exploration and exploitation work is carried out simultaneously.

Medium-sized mining refers to operations that, due to the size of the deposits and depending on the type of metallic and non-metallic mineral substances in question, have quantified reserves sufficient to allow the exploitation of those reserves over the processing volume established for the special regime for small-scale mining and up to the volume established by law.

Large-scale mining is considered to be that which exceeds the maximum volumes established for medium-sized mining.

Non-Metallic Mining Regime and Construction Materials

The exploration and exploitation of non-metallic mining must comply with the general rules applicable to mining concessions in the terms provided by the Mining Law and its Regulations.

In the case of construction materials, the State, through the Ministry of Energy and Mines, may grant concessions for the use of surface clays, sands, rocks and other materials of direct employment in the construction industry, with the exception of river beds, lakes, sea beaches and quarries that shall be governed by the limitations established by law.

In the framework of Article 264 of the Constitution, each municipal government shall assume the powers to regulate, authorise and control the exploitation of arid and stone materials found in the beds of rivers, lakes, lagoons, beaches and quarries, according to the Special Regulations that will establish the requirements, limitations and procedures to that effect. The exercise of competence shall be limited to the principles, rights and obligations contemplated in the municipal ordinances that are issued in this regard. The municipal governments shall not establish conditions and obligations other than those established in this law and its regulations.

The granting authority for mineral rights is the central government, through the Ministry of Environment and Energy, which in turn has agencies in different regions of the country. The granting of a mining concession is an administrative act issued in a form and substance predetermined by the law and in a format pre-established from time to time by the Ministry. The terms and conditions of the administrative act are not negotiable. All mining concessions have the same terms except for the area and remaining term of the concession. The law recognises different types of mining: small-scale, medium-scale and large-scale, plus non-metallic and construction material mining concessions.

Ecuadorian laws are applicable to all mining concessions and the mining title does not contemplate international arbitration.

For the granting of mining concessions, the Ministry of Energy and Mines will call for a public auction for the granting of all metallic-mining concessions. Likewise, it will call for a public auction for the granting of mining concessions on areas of concessions that have expired or that have been returned or reverted to the State, in which the petitioners shall participate and present their respective offers in accordance with the procedure established by the law.

The mining concession is an administrative act that grants a mining title, over which the holder has a personal right, which is transferable prior to the mandatory qualification of the suitability of the transferee of mining rights by the Ministry of Environment and Energy, and on this may be established pledges, assignments in guarantee and other guarantees provided by law, in accordance with the prescriptions and requirements contemplated in this law and its general regulations. The mining title, without losing its personal character, confers on its holder the exclusive right to prospect, explore, exploit, benefit, melt, refine, commercialise and dispose of all the mineral substances that may exist and be obtained in the area of that concession, becoming a beneficiary of the economic yields obtained from those processes, within the limits established in the present regulation. Mining activities may only be carried out once the prior administrative acts have been obtained. These prior administrative acts include acquiring an environmental licence and an independent certificate from the water authority that evidences that the proposed activities shall not have any impact on water sources.

The mining concession shall have a term of up to 25 years, which may be renewed for equal periods, provided that a written request from the concessionaire has been submitted to the Ministry of Energy and Mines for that purpose prior to its expiry and a favourable report has previously been obtained from ARCOM and the Ministry of the Environment. The mining concession will be divided into an exploration stage and an exploitation stage. During the exploration stage, a distinction will be made between the initial exploration period, the period of advanced exploration and the period of integral economic evaluation of the deposit. It will incorporate the main, secondary and other minerals of economic value.

Mining holders may suspend activities when the protection of the health and life of mining workers or communities located within a certain distance of the area where mining activity takes place so requires, as provided in the general regulations of the law, when required by the Civil Defence or when non-compliance with the environmental licence by the competent environmental authority is verified. In any case, the suspension of mining activities shall be ordered exclusively by the Minister of Energy and Mines, by means of a reasoned resolution.

A mining concessionaire who is prevented from carrying out their mining activities normally, due to force majeure or a fortuitous case duly proven, may apply to the Ministry of Energy and Mines for the suspension of the concession term for the period that the impediment lasts. For this purpose, the Ministry of Industry, by means of a reasoned resolution, shall admit or deny any such request.

Grant, Exploration and Exploitation Stages

Mining concessions are granted through a competitive process where the first applicant has the right to match other offers, except in the case of applications made by ENAMI.

Unfortunately, the mining registry and procedure for new applications, called “Catastro Minero”, has now been closed for almost eight years and it is impossible to predict when it will be reopened. Therefore, the only possible way to enter now is to partner with an entity that already holds mining rights or with ENAMI.

In accordance with the mining law, a mining concession has up to four years for initial exploration, up to four years for advanced exploration, up to two years (renewable by an additional two years) on economic evaluation and what remains of up to 25 years on exploitation. The exploitation period can be extended for up to another 25 years.

Once the initial exploration period or the advanced exploration period, as the case may be, has been completed, the mining concessionaire will have a period of up to two years to carry out the economic evaluation of the deposit and request, before its expiry, the beginning of the exploitation stage and the corresponding subscription of the Mining Exploitation Contract, in the terms indicated in this law. The mining concessionaire shall have the right to apply to the Ministry of Energy and Mines for an extension of the period of economic evaluation of the deposit for a period of up to two years from the date of the administrative act accepting that application.

In the event that the mining concessionaire does not request the start of the exploitation stage in the terms indicated in the foregoing, the mining concession shall be declared extinguished by the Ministry of the Sector.

Within six months from the resolution declaring the beginning of the exploitation stage, the mining concessionaire must sign with the State, through the Ministry of Energy and Mines, a Mining Exploitation Contract containing the conditions and terms for the construction and assembly, extraction, transportation and commercialisation stages of the minerals obtained within the limits of the mining concession.

The holder of a mining concession may not carry out exploitation work without having previously signed the respective contract.

Fees, Royalties and Taxes

Maintenance fees per hectare “patente” must be paid annually during exploration and exploitation stages, on a scale that is adjusted annually in proportion to the minimum wage of Ecuador (USD470 for the year 2025). For small-scale mining, the patente is equivalent to 2% of the minimum wage (USD 11.75 per mining hectare). For medium and large-scale mining, the patente shall be paid as follows:

• initial exploration, 2.5%, equivalent to USD11.75 per mining hectare;
• advanced exploration and economic evaluation, 5%, equivalent to USD23.5 per mining hectare; and
• exploitation, 10%, equivalent to USD 47 per mining hectare.

In June 2025, the Mining Regulation and Control Agency passed a Resolution imposing additional mining maintenance fees. As per this Resolution, different percentages are applicable depending on the mining regime, as set out below.

Small-scale mining:

• exploration – 15% of the minimum wage, equivalent to USD70.5 per mining hectare; and
• exploitation – 25% of the minimum wage, equivalent to USD117.5, per mining hectare.

Medium-scale mining:

• initial exploration – 30% of the minimum wage, equivalent to USD141, per mining hectare;
• advanced exploration – 40% of the minimum wage, equivalent to USD188, per mining hectare;
• economic evaluation – 20% of the minimum wage, equivalent to USD94, per mining hectare; and
• exploitation – 50% of the minimum wage, equivalent to USD235, per mining hectare.

Large-scale mining:

• initial exploration – 25% of the minimum wage, equivalent to USD117.5, per mining hectare;
• advanced exploration – 75% of the minimum wage, equivalent to USD352.5, per mining hectare;
• economic evaluation – 25% of the minimum wage, equivalent to USD117.5, per mining hectare; and
• exploitation – 100% of the minimum wage, equivalent to USD470, per mining hectare.

The benefits of the project are understood to be the revenues from the sales of minerals, minus amortisation of investments, operating costs and all pertinent taxes, government royalties and profit-sharing. The benefit to the company must be lower than the benefit to the State that is formed by all taxes and royalties paid by the company in the same fiscal year. An adjustable formula called the “ajuste soberano” is incorporated into the contracts to ensure that the benefits to the State remain higher than the benefits to the operating company throughout.

If a project is considered to be large-scale before it has entered into the exploitation stage, the concession holder must execute a contract with the State of Ecuador where minimum investments on the project and future royalties are set up.

Termination and Transfer of Rights

The State of Ecuador may declare unilateral termination of a mining concession if the company has breached certain provisions of the law, including non-payment of annual per-hectare maintenance fees or royalties, not meeting minimum commitment investments, employment of children, material environmental damage duly proven through the Ministry of Environment and pertinent courts, and transference of mining rights without prior approval of the ministry.

Unilateral termination is conducted through a process where the company has the right to defend itself and, if possible, correct – and compensate for – the fault that led to the unilateral termination.

Mining rights are transferable, provided prior approval is granted by the Ministry of Energy and Mines. For the transfer process, a request must be submitted to the Ministry specifying the percentage of the area to be transferred and attaching supporting documents. If the documentation is complete, the Ministry will request ARCOM to issue three reports: legal, technical and economic. With these ARCOM reports, the Ministry will issue a resolution approving the transfer of concessions. This resolution must be registered in the Mining Registry under the charge of ARCOM. Subsequently, a Public Deed must be executed between the assignor and the assignee, attaching the registered approving resolution. At the end of the process, the Public Deed must also be registered in the Mining Registry under the charge of ARCOM.

Commercialisation, Marketing and Export

The mining law establishes the right to free commercialisation; the holders of mining concessions can commercialise their production freely inside or outside the country. However, in the case of gold from small-scale mining and artisanal mining, the Central Bank of Ecuador will market it directly, or through public and private economic agents previously authorised by the Bank.

Natural or legal persons who, without being holders of mining concessions, are engaged in the marketing or export of metallic mineral substances or in the export of non-metallic mineral substances, must obtain the corresponding licence from the Ministry of Energy and Mines, in accordance with the provisions of the general regulations of the law. The same licence must be obtained by the mining concessionaires who trade in metallic mineral substances or export non-metallic substances from areas outside their concessions.

Natural or legal persons engaged in the internal commercialisation of non-metallic mineral substances, as well as jewellery artisans, will not require this licence. The marketing licences granted are valid for periods of three years, are non-transferable and can be renewed for the same periods.

Clandestine trade in mineral substances is considered in the case of:

• holders of mining concessions who trade internally in metallic mineral substances, or export metallic or non-metallic minerals from other concessions, without the required licence; or
• mining producers who sell metallic mineral substances to persons or entities not authorised to commercialise them.

Licensing Requirements and Preliminary Conditions

Before any activity on a mining concession can start, an environmental licence granted by the Ministry of Environment and Energy, must be obtained. There are different types of licence depending on the activity contemplated. For initial exploration activities, the licence, called an environmental registry, can be obtained faster than for advanced exploration or exploitation, for which it can take up to two years to obtain the environmental licence. In addition, it is a requirement that an independent certificate from the water authority be obtained, evidencing that the proposed activities shall not have any impact on water sources.

As a signatory of different international treaties, Ecuador also requires community consultation in cases involving indigenous communities and, in all cases, it is mandatory to disclose and inform the people of the area about the potential environmental impacts of each activity. Community rights and continuous constitutional actions against mining companies brought by political leaders are a serious concern for mining investors and have to be analysed carefully before entering into any project in Ecuador.

Environmental licensing is an obligatory process for mining concessionaires, so that they can proceed with the different mining stages, and this must be managed through the Unified Environmental Information System (SUIA).

Intersection Certificates and Environmental Classification of Concessions

In order to obtain the environmental licence, it is necessary to request an Intersection Certificate which verifies the location of the concession within protected areas, or not, since, if this is the case, it will be necessary to act differently. In all cases, the mining title holder must obtain from the National Environmental Authority the Intersection Certificate from which the intersection of the mining rights in relation to the National System of Protected Areas, Protected Forests and Vegetation, State Forest Heritage or other conservation areas declared by the National Environmental Authority is detached.

If the mining right intersects with the National System of Protected Areas, as far as extractive activities are concerned, it will proceed according to the provisions of Article 407 of the Constitution of the Republic of Ecuador and the competent environmental regulations. In the event that the mining right intersects with Protective Forests and Vegetation or the State Forest Heritage, the mining title holder, prior to the start of the environmental licensing process, must apply to the National Forestry Directorate of the Ministry of the Environment for certification of environmental viability qualified with the report on the feasibility of the mining right. This certification will be issued by the National Forestry Director.

The Intersection Certificate will be issued for the mining rights, among others authorised by the Ministry of the Environment and Energy, or for those cases in which the title holder requires only the environmental licence of the operating area.

Environmental Impact Study and Management Plan

It is the responsibility of the mining title holder to contract an external consultant qualified by the Ministry of the Environment and Energy, who will be in charge of carrying out the Environmental Impact Study within which a technical file of the project must be included, a description of the study area and a complete description of the project prior to the beginning of any stage of exploration, exploitation or others. Likewise, in conjunction with the Environmental Impact Study, it is necessary to carry out the Environmental Management Plan, which includes methods of evaluation and monitoring of the project, as well as a general schedule containing a budget within which the environmental policy requested by the same ministry is included.

The Environmental Impact Study must identify, describe, quantify and evaluate, in a precise manner and according to the characteristics of each case, the foreseeable effects that the execution of the mining project will produce on the different environmental and socio-economic aspects. The Environmental Management Plan will also include aspects of monitoring, evaluation, monitoring and contingency, partial closures of operations and closure and abandonment of mining operations, with their respective programmes, schedules and budgets.