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Bolivian Vice President Alvaro Garcia Linera signed a decree Wednesday revoking Glencore International PLC's (GLEN.LN) concession for the Colquiri lead and tin mine.
Glencore's Bolivian subsidiary, Sinchi Wayra, currently holds the concession. A deal was reached with Sinchi Wayra employees and cooperative miners to nationalize part of the mine while leaving another section to the cooperative, according to state news agency ABI. The mine will be run by state mining company Comibol.
Within the next 120 days the government will calculate the amount owed to Glencore for the machinery and equipment that will be handed over to Comibol, Garcia Linera told ABI.
The nationalization puts an end to a tense standoff between Sinchi Wayra workers and cooperative miners. About 1,000 cooperative miners seized control of Colquiri at the end of May, demanding they be granted the exclusive right to mine the site, while Sinchi Wayra's roughly 400 employees pushed for the government to take it over.
Glencore has a 100% stake in Sinchi Wayra, which operates five mines in the Oruro and Potosi regions of Bolivia. The company is currently in talks with the Bolivian government to amend Sinchi Wayra's mining contracts to bring them in line with the country's new constitution.
In 2009, Bolivia changed its constitution to require miners to form joint ventures with the government.
The company has made progress but it is not clear how and when a deal will be struck, Glencore said in its March earnings report.
Bolivian President Evo Morales has implemented a string of nationalizations since taking office in 2006. During his first year in office, he nationalized natural-gas fields and two years ago, the government took over most of the country's electrical generation capacity.
On Wednesday, the vice president said that the government didn't plan to nationalize all of the country's resources, but rather it would have the state control the "spinal column" of the economy, leaving other areas open for private ventures.
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