He sold his previous company to Edelman for a tidy sum, and after cooling his heels for a few years during an agreed upon period, he’s back in business. While his first company was closer to a traditional PR firm, Ferro says his new firm, Tank, is a different kind of entity. While more than competent in traditional communications work, Tank is more of a management consultancy that works on public engagement, government relations, and strategy.

Using a military analogy, hence the name Tank, Ferro tells Finance Colombia’s executive editor Loren Moss how the firm is willing to go to battle in the trenches in order to win the war for hearts and minds, and is not afraid of representing entities in challenging sectors when the going gets tough.

Finance Colombia: I’m here with Mauricio Ferro, the CEO and founder of Tank. So, you’ve had a successful career in strategic communications. I don’t want to say it like it’s over anything like that because in fact, you’ve had a string of successes, but now you’ve launched Tank which is your latest entity and it’s a little bit different than the things that you’ve done in the past. Maybe if you could tell us a little bit about Tank.

Mauricio Ferro: Yes, thank you, Loren. Well, Tank is my latest newest startup in PR, we come from the PR scope, but we do a lot more than public relations. Actually we take pride in not only doing public relations and whatever it involves, talking to media, the media relations or going to Congress, but what we do is actually build relationships with publics, and building relationships with publics means going and hiring different types of influencers or going to a community that is not allowing the big bulldozers of a mining company come into a town, so we do work and facilitate the work of many national and multinational companies in Colombia with Tank, which is my newest venture.

“We were able to differentiate ourselves through technology. We’re doing it again.”

Finance Colombia: So when is it that companies—it’s interesting because I was speaking the other day with an international company and they were asking me about the business climate in Colombia, if they were going to come into Colombia. And one of the things I mentioned to them was that Colombia has a thriving democracy. No country is perfect in Colombia has its challenges.

But in Colombia you can’t come in here like the South America of the 1950s or maybe some other countries today where you can just come in and go to the president’s administration and work something out and then do whatever you want to do. It’s not like that. It’s like today you really need the buy-in of the public. The public does have a voice. The public, you go into rural areas and there was the famous case of Anglo Gold where they had all their permits and everything on paper. But they didn’t have the acceptance of the community and they were forced to kind of sell their assets and leave. And so, what are the different—you’ve worked in many different—not just Latin American countries, but in America and with European countries. What are some of the peculiarities of Colombia in the Andean region that a lot of times companies don’t necessarily take into account when they want to come and do business and in Colombia or the region?

Mauricio Ferro: Well, Colombia is very democratic and it’s a country of many regions. So you have to understand what is going on in in each area that you want to go and conquer, and you have to be a good neighbor. If you are in a community, you have to show goodwill. You have to have a good ESG strategy and it’s not just a matter of knowing a couple or a bunch of politicians. I mean, you have to have all the right connections, which we can help with. But more than that, you have to build your reputation and build your attributes to that reputation so that people understand that you are well-intentioned and that you’re going to bring benefits overall to the community and to the city or the town in which you are.

Finance Colombia: What about when things go wrong? You know companies, sometimes you have…whether it’s a natural disaster, whether the company simply made a mistake. In the worst-case scenario, the company…there may have been some negligence. But even still, whatever the situation is, the company needs to deal with it and needs to recover. What is the importance of using outside professionals and outside consultants, whether that might be crisis management or really being able to get out in front of a situation whether the company is at fault or not? Still, you know, a lot of times the companies are not equipped internally to deal with unexpected situations and just like companies might need to go and bring in outside counsel for legal situations or outside and environmental experts, that’s the role in critical situations for outside experts and strategic communications?

Mauricio Ferro: Well, today in managing your communications, transparency is the name of the game. I mean, you can’t have a hidden agenda, you must work along with the country, with the community. You have to show your intentions and if you have gone wrong, you know there’s a wealth of experience in many cases that we have managed in which have we have been able to turn around the situation and go from a law, a bill, or a company that has a bad reputation and be able to turn it around and position it positively in front of your stakeholders.

You know, there is, for example, the TIC [telecommunications] law. I helped the first minister of President Duque, who was Sylvia Constain. She had this bill that was very, very well-intentioned, but it had gone under in terms of reputation because of a separate issue that had gone wrong with somebody, the state radio station, radio and TV station. So what we did was talk with everybody that we had to, go to every single stakeholder and tell them about the benefits of the bill. And three months and one week later, we were able not only to reposition the reputation of that bill, but also we were able to have a majority of the lower Chamber of Congress and the Upper Chamber Senate to approve it, with a majority even having a strong partisan environment. So that’s the kind of thing that we do. For example, the Colombian Stock Exchange, they called us when the largest broker went down. So, what we had to do along with the lawyers along with…

“Today in managing your communications, transparency is the name of the game.”

Finance Colombia: Interbolsa?

Mauricio Ferro: Yeah, it, it went down the drain and our job along with the other teams, you know the legal, the legal counsel and the CEO was to stop the rest of the Stock Exchange of going under. There, keep maintaining the credibility and keep investor confidence. So, you had one brokerage go down but the exchange is still solid.

Finance Colombia: Now tell me about the difference. So, they’re obviously, there are strong Colombian companies. Some of them have become multi-Latinas and even multinationals, a few even global companies, but tell me about the special challenges that foreign companies may have when they decide to come and do business in Colombia. Colombia has an exceptional legal environment. That’s to say that it treats foreigners and foreign companies on equal legal footing as domestic companies which is a good thing. But let’s talk about, aside from the legal and fiscal, when Colombian companies or when foreign companies come and decide that they want to do business in Colombia, where have you seen them struggle and stumble and where maybe some of the mistakes that could have been prevented if they had the right kind of professional advice from the beginning?

Mauricio Ferro: Well, generally in the 1980s, foreign companies used to bring somebody from the headquarters to be the general manager in Colombia. Nowadays, I would say that 98.99% of the companies do have expats, but their CEO, their general manager is generally somebody who’s local, somebody who is bicultural, perhaps somebody who’s studied in the states or in Europe and is able to understand both the culture in Colombia and the culture in headquarters, you know, so that’s a better formula and that generally keeps the companies out of trouble because that person is going to come in with the right knowledge of the idiosyncrasies again and be able to you dodge around the red tape and the difficulties of doing business locally.

You know, of course we help a lot of those companies to understand what they want to do and then what they have to do to be able to be well perceived. For example, in mining and we advise a lot of oil and mining companies. We see that there’s a common term whenever somebody arrives from headquarters, and they say we want to be low profile.

Guess what? They come in with a huge Caterpillar which is twice the size of the narrow roads which they come in! And they come into a small town and everybody in the town sees the big machine coming in and they start talking and of course…We are in the middle of fake news. They are in the middle of gossiping about the company. So, what is there about being low profile in that? You know, there’s no profile. Low profile does not exist, right? So, it’s much better to come in first and ask the people what they want. What are they lacking? What are their needs? You know, to be able to understand how to become a good neighbor, you know, a good neighbor when somebody comes next door, you know, at least you have to come in and say hello.

Finance Colombia: Exactly. Especially if you’re gonna do some remodeling!

Mauricio Ferro: That’s right, you know. So we advise companies in how to go the right way so that there is not a first bad image or a second bad image, but we have a good and positive relationship with all the stakeholders that are being taken into account.

Finance Colombia: How can executives that are either hoping to enter Colombia or that are already doing business in Colombia or the broader Latin American region, contact Tank to explore more about the services that you offer?

Mauricio Ferro: Well, we have our website that’s www.Tank.com.co, we are in social media as Tank consultants or Tank Communications and they can reach for us. Also, through the Chamber of Commerce and we are also in the Presidents Forum in Colombia, Foro de Presidentes, and we advise the companies in different levels. You know we do what we call the aviation, we what we call the artillery of communications and the infantry of communications, OK, so that CEOs of companies are able to communicate in the three levels.

The first one, aviation, is communicated 1 to 1,000,000. So, it’s putting your name in the paper being able to have positive media relations. The second level or the artillery is to be able to communicate with your social media, with your stakeholders that might be noticing you not in the news, but in Twitter or in Facebook or Instagram or in TikTok. And our last level is the one to few communications. You know, that’s the infantry, and generally the war starts with aviation, but only the infantry is able to control their territory, right?

You know, just like in a regular war and, this time we’re talking about the war for the mind. The war for the mind is works pretty similarly to the regular war. So, if you’re going to battle, you have to be able to communicate in the three levels and in the last level, we are introducing a lot of technology. For example, we are doing the training of the CEOs. We do it through VR, OK, with virtual reality, we simulate the different types of scenarios that that CEO is going to be challenging if it’s a town hall meeting or if it’s a Ted-talk or if it’s a talk in front of 1,000 investors, you know, we can train that person to have prior experience so that the actual experience seems something very, very normal and regular.

So, with my prior company that that I sold to Edelman, you know one of the reasons that they bought my company was because we had great methodology and we had great technology. You know, they came in and they picked us, they came and knocked on our door from a bunch of PR companies that are in Colombia and we were able to differentiate ourselves through technology.

We’re doing it again. We’re differentiating ourselves through technology so that you know, we are very different from any regular PR company.

Finance Colombia: What’s your vision for the company? What do you want Tank to look like 5 years from now?

Mauricio Ferro: Well, more than just a PR company, we are well-rounded and a full-service agency.  You know we can buy media for you. For example, we have a client in Florida which is Jorge Perez. Jorge Perez is the person that put the name to the Perez Museum in Miami, Related Group, right? That’s the Related Group, they turned around the city because Miami was a place in which you went to the beach, but not more than that. Now the city is full of culture.

“You have to have a good ESG strategy and it’s not just a matter of knowing a couple or a bunch of politicians.”

You can go to the Wynwood neighborhood and see a lot of galleries, a lot of culture, a lot of happenings going on there because of the turnaround that Jorge Perez is leading in the city of Miami and he’s our client and we brought him to Colombia. So, we bought the media in social media, we bought the media in the newspapers and we had such a big splash that his best latest projects are almost sold out.

The four projects that that we promoted were all in the city of Miami and they are almost sold out from investors that are coming from Colombia, from Peru, from Chile, from Argentina, from Brazil and from Mexico mainly.

Finance Colombia: Was there anything that I forgot to ask you that you wanted to mention?

Mauricio Ferro: Maybe the fact that our business is kind of countercyclical, like you would think that companies are being nervous about investing in Colombia because of the new government. I can give some peace of mind in that sense, you know, because one: Colombia is very democratic. So, there’s a very good system of checks and balances that is going to be difficult to dismantle. Also, in Colombia…the big industry associations, you know, the gremios. Many of them are coming to us for advice on what kind of communication they should be doing on how to communicate. In difficult times or in times in which they are having a very low interaction with the government or very low capacity or ability to speak up and participate together over the garbage, you know and understand what’s going on. You know, so many companies and many associations, are coming to us to, to ask us for guidance, for assessment on how they should communicate in these times.

Finance Colombia: That’s so important. I mean you look at certain sectors, every government comes in and has biases towards certain sectors and against other sectors, right? And even, it’s kind of easy if you know if the president is a friend of whatever business you’re in. But if not, that’s when it’s more important than ever to get your message, to shape your message, to get your message out there, and then to try to the extent possible, get the public on your side, right?

Mauricio Ferro: You know now that that’s why we have invested so much in ESG: Environment, Sustainability and Governance, but particularly we are also providing the companies for example the big soda pop companies with technology to be able to separate their waste. Why? Because they are being critiqued of by for how much plastic they generate, you know, and of how committed they are of taking that plastic after it’s become waste, to bring it back into the possibility of reusing that material.

That’s one of the products that that Tank has. Tank more than just a PR company as I say, as I said it’s investing in different types of technologies and we are kind of a Think Tank. That is sponsoring and launching different types of technologies and methodologies to make your company’s reputation much better.

Buriticá has a troubled history, formerly being in lands disputed by leftist guerillas and right-wing paramilitaries until about a decade ago. The town is near still-active narcotrafficking routes, and is a regional center for artisanal, illegal, and illegal artisanal mining (not all artisanal mining in Colombia is illegal).

In 2016, media & analysts visit Continental’s offices in the town of Buriticá where locals talked about their collaboration with and support of the miner (photo: Loren Moss)

When the Continental team came in, they first reached out to the mayor and locals to both explain their plans, but also get an understanding of the local situation, and how they could help. Buriticá Mayor Luis Hernando Zapata told London-based Diálogo Chino that “Continental Gold brought a social investment strategy, where there was motivating information for the territory, where the expectation of the municipality was employment, productive chains, business initiatives, and training.” On the other hand, “Zijin has only supported road construction projects and infrastructure repairs.”

This was the opposite approach to what was happening almost simultaneously with South African mining company Anglo Gold, almost 370 kilometers away near Cajamarca, Tolima. Though, Anglo had made all the right moves in the capital of Bogotá with politicians and regulators, the company failed to win the hearts and minds of the locals, and apparently did not understand the higher degree of citizen engagement and influence in Colombia. Cajamarca residents voted 6,165 to 76 against Anglo Gold!

Headline photo: The small town of Buriticá has less than 3,000 residents, with another 7,000 in the surrounding area. It is less than an hour past the popular tourist town of Santa Fé. itself 90 minutes from Medellín (photo: Loren Moss)

With such public opposition at the local level, Ashanti’s La Colosa and Quebradona projects are stalled, as Colombia’s environmental authority (ANLA) have so far refused to issue licenses. In 2019, Anglo sold a significant chunk of its Colombian assets to Royal Road Minerals.

As Continental developed its mine, it also worked to develop relationships with the local community, including with local artisanal miners who had been working in the area for centuries. Continental, which was building an environmentally friendly gold processing facility on site, instituted a program to buy and process gold ore from artisanal miners, so they wouldn’t have to try to poison themselves with mercury or sell gold to organized crime.

Continental did have to take action against illegal “claim jumpers,” who were not interested in collaborating with the company, but were mining on Continental’s claim, and causing the risk of landslides and collapses. Efforts were effective due in part to the close coordination and relationships between Continental, local, and national officials.

Unlike many mining companies, Continental employed highly qualified Colombians in top management, such as Mateo Restrepo Villegas as Executive Vice President and later, President, and Mauricio Castañeda as vice president of exploration.

“A very special recognition to the Continental Gold Women’s team, the first of its kind to participate in the National Mine Rescue Olympics and a champion of discipline, courage and bravery”. Silvana Habib Daza, President, The National Mining Agency (ANM).

Continental worked to open mining opportunities to women, and even sent an all-woman team to the 12^th International Mines Rescue Competition in West Virginia, USA. Continental employed local seamstresses in Buriticá to create the company’s uniforms, and supported local educational efforts, even opening a community center.

Investors were impressed when Continental’s management sold the mining company to China’s Zijin mining for over a billion USD. Zijin Chairman Chen Jinghe specifically said in a statement that “Zijin is conscious of the demonstrated responsibility of Continental’s operation towards the well-being of the local communities and the responsible management of environmental aspects of its operation. Zijin commits to continuing with a similar approach, focus and investment in that regard. Zijin will practice in all its operations with the same commitment of Continental towards transparency and ethics and will continue to operate in a highly responsible manner in Buriticá, Antioquia and Colombia more broadly.”

Visiting continentalgold.com features on the home page content from 2017 highlighting a video from a visit of Silvana Habib Daza, who headed Colombia’s National Mining Agency two presidential administrations ago!

However, that has not been the case.

Immediately after the 2019 transaction, Finance Colombia began to reach out to executives of the new owners with the hopes of keeping open the excellent lines of communication enjoyed with the previous management. The new Zijin-Continental Gold management never responded to outreach and appeared to have a policy of reticence towards media. The perception is that, now a business unit of a global mining conglomerate connected with the Chinese government, there was no need for investor relations, media communications, community relations, or any such inconveniences.

Zijin executives seem to be highly media-shy and prefer not to engage with the public. Visiting continentalgold.com features on the home page content from 2017 highlighting a video from a visit of Silvana Habib Daza, who headed Colombia’s National Mining Agency two presidential administrations ago! In other words, the site has apparently been untouched since Zijin took control.

From community friend to villain

Soon after Zijin purchased Continental, local relationships began to sour. There have been three documented work stoppages at the Zijin mine, something that did not happen with the previous Continental ownership. While Continental took an aggressive stance against illegal miners, it did seek to collaborate with artisanal miners, and understood the difference. Before the sale to Zijin, Continental reportedly backed to the tune of $20 million USD a government operation against illegal mines often controlled by mafias and manned by trafficked victims. The efforts were backed by artisanal miners, who were always at the risk of extortion or displacement by illegal miners.

On the other hand, just this month, the Western Antioquia Miners Association that represents artisanal miners, has asked the Colombian government to take action against Zijin, who it accuses of filling subterranean tunnels with sludge, leading to the deaths of two miners last year.

In 2021 Zijin paid approximately $11 million USD to the Colombian government, but the municipality of Buriticá only saw about $100,000 USD of that, less than the cost of a nice condominium in Medellín.

In the sludge incident last August, Zijin asked the government to intervene and remove blockades set up by residents of Buriticá to protest the death of Victor Enrique Peña Alvarez and Jesús Arturo González, Contreras. At first Zijin denied that there were no dead miners thus no reason for protests…until the bodies were found. Locals accused Zijin of entombing the miners under sludge and rocks. Peña came to Colombia as a child from Venezuela, while González was an internally displaced refugee from Urabá, a rural region of Colombia north of Buriticá that suffers from domination by the Clan del Golfo mafia.

The town of Marmato, Colombia last week issued a proclamation recognizing Collective Mining’s (TSXV: CNL) (OTCQX: CNLMF) social activities and efforts within the municipality.

Relationships between Zijin and the local community have continued to deteriorate to the point where Zijin has released a letter dated January 26 of this year, addressed to President Gustavo Petro and copied to a couple dozen other politicians, military brass, and government functionaries. Petro, in the first year of his term as Colombia’s President, promised during his campaign to be an ally of artisanal miners.

While the team that built Continental has moved on to found a new mining company called Collective Mining already winning accolades for good relations with the local community, in Colombia Zijin seems to be playing from Anglo’s playbook with efforts focused on Bogotá, locals be damned.

It is true that to a real extent, mafia groups are active in the region. Three Continental Gold geologists were killed in 2018, but at the time, Continental executives pointed out to Finance Colombia that the criminal acts took place over eight hours away by road from Buriticá. Today, Zijin is making a grave mistake in painting the resistance to its activities and conduct, or local artisanal mining as mafia related.

The letter, reproduced below and translated by Finance Colombia, is fascinating in its tone, even irony. Signed by Leizhong Li, the last sentence of the fifth paragraph on the second page says of what it calls illegal miners: “the vast majority of them are foreigners and do not belong to the community of Buriticá.” As of press time, we have been unable to confirm whether in fact, the denouncer of foreigners, Mr. Li, is a “Paisa” belonging to the community of Buriticá.

Full disclosure, let it be known the editor of this piece is too, “a foreigner and does not belong to the community of Buriticá.”

Buriticá, 26 January 2023

Lord

GUSTAVO FRANCISCO PETRO URREGO

President of the Republic of Colombia

HOUSE OF NARIÑO

Bogota D.C. E.S.D

Ref.: Urgent request for intervention

Your Excellency Mr. President,

The company Continental Gold Limited Sucursal Colombia (hereinafter referred to as the “Company”) is a subsidiary of the Chinese conglomerate Zijin Mining Group Co., Ltd., dedicated to the exploration, exploitation and development of mining properties and projects around the world, and whose main asset in Colombia is the Buriticá Gold Project, recognized as one of the “Projects of Strategic National Interest” (PINE) by the Intersectoral Commission on Infrastructure and Strategic Projects, as it is considered the first large-scale modern underground mine in Colombia.

The project, located in Buriticá, a municipality in western Antioquia, was launched in March 2020, after obtaining the corresponding approvals for its expansion and culminating with the construction phase, thus starting the large-scale commercial production of the Buriticá Mine, its main products currently being doré bars, copper concentrate, and gold.

 Our work is responsible with the environment, meets all quality standards and contributes to the territory. We have modern mining technology, we do not use mercury in any cycle of our process, and we achieve zero discharge of industrial wastewater. The company reports investments of more than 44 million dollars for the construction of the most modern water treatment plant in Colombia and one of the most modern in Latin America.

Within the framework of the above, we vehemently appreciate the support provided by the National Government, which has been key to the consolidation of the Project, as well as the immense efforts deployed by the different authorities in order to confront the situation of risk that the Illegal mining has generated in our mining work and in the municipality where we currently operate.

However, in Buriticá the action and control of illegal mining exercised by the Clan del Golfo continues, which puts at risk not only the situation of public order, but also the life and integrity of those who carry out this type of activities in an irregular way, of the Company’s personnel, their

contractors, the Public Forces and the community of the municipality of Buriticá and western Antioquia in general.

Faced with the above panorama, and despite the efforts made by the municipal and departmental authorities, we find that the situation has overwhelmed the capacity of the local Public Force, which has not been able to contain the advance of illegal mining activity that affects the municipality, and on the contrary has seen how illegal action increases over time.

Next, we allow ourselves in the most respectful way to share with you the situation of affectation of the Ilegal Mining in our operations of the Buriticá Mine.

The mining area of the company is divided into 3 development zones: high, medium and low, according to different levels, respectively called Yaraguá tunnel, Rampa Sur tunnel and Higabra tunnel. In the lower area, adjacent to the Higabra tunnel, most of the mine’s infrastructure is located: Processing Plant, Treatment Plant, Administrative Offices and Camps.

 Currently , 100% of the Yaraguá tunnel is affected by illegal mining, which has also invaded most of the Rampa Sur tunnel, forcing the Company to abandon its production mining operations in the upper and middle areas and concentrate its main efforts in the lower part of Higabra . However, at the end of 2022, illegal miners connected the structure of the Higabra tunnel, displacing Company personnel using firearms and improvised explosive devices, amid a display of violence that continues today.

According to the above, more than 50% of our underground mining bores are invaded by illegal mining; in recent months, there has been an increase in the presence of unauthorized miners in the Company’s infrastructure. It is estimated that this number has increased from 400 to 700 in the Yaraguá, Rampa Sur and Higabra tunnels. The above, together with the existence of unauthorized mining work in the municipality of Buriticá, in areas adjacent to the mining title, covers a total of approximately 2,000 people engaged in illegal mining activity, according to the calculations made by the Company, the vast majority of them are foreigners and do not belong to the community of Buriticá.

These activities are carried out through excavated accesses from private properties of third parties directed towards the underground infrastructure of the Company, from which they complete the strategy of “block domain”, invade the tunnels of the operation to carry out mining activities in a mechanized manner, with large-scale work, without control or planning, much less respect for environmental mining or safety in mining operations, also using illegally obtained explosives or artisanal manufacture that are also used to attack the Company’s personnel, its contractors, security guards and to the Public Force. It is estimated that around 100 tons of illegal explosives were used over the past year, of which approximately 70 percent were manufactured by INDUMIL. In addition, and in order to intimidate the employees of the Company, to contractors and repel the Public Force, they shoot handguns and rifles and install gas cylinders and fire extinguishers loaded with explosives in the tunnels.

 During the years 2021 and 2022 alone, the Company attended with its team of mining rescuers 16 injured by explosives, including direct personnel, contractors and Public Force, in addition to 5 people who were injured in the framework of activities unauthorized miners left in the tunnels to be rescued by Company personnel. Likewise, the discovery of 5 bodies of personnel outside the work of the Company abandoned inside the Yaraguá tunnel was reported.

Unfortunately, this situation of violence, framed by the use of firearms, illegal detonations inside the tunnels and the use of improvised explosive devices, has been increasing exponentially, as can be seen in the following comparative table:

In this way, in addition to blocking the work of the Company and putting at risk the lives of the personnel working inside the tunnels, an approximate amount equivalent to 1.5 tons of ore is illegally extracted through the illegal connections, not including the estimate of the illegal extraction in other areas of the mining title and surrounding areas, which represents for the State (according to calculations made during the year 2021) losses equivalent to:

+US$84M for theft of explosive material and blasting accessories

+US$ 3M for royalties lost

+US$11.8M for rent tax

+US$ 2M for self-withholding

The stolen ore is processed inside the illegal mining works, for which “Entables” processing plants have been built inside the tunnels, which makes them difficult to detect, causing environmental damage and human health due to the use of mercury.

As confirmed by the same authorities, mining activities in the municipality of Buriticá are permeated by the Clan del Golfo, and mean a very important income for their criminal apparatus, which adds to the resources they obtain from drug trafficking, smuggling, among other illicit activities. This is also a fuel that clearly affects the environment in the area, society as a whole and threatens the security of the region and the country. As observed by the Company in the framework of its operation, the effects of illegal mining can be summarized in the following points:

1. 1. 1. Environmental pollution: These illegal groups carry out illegal exploitation anywhere. In their activities they leave residues such as tailings anywhere without any rigorous and technical disposal, which leads to a contamination of water resources and serious erosive processes in productive lands, so important today for the country.

In their illegal extraction activities, they have even reached the point of carrying out their beneficiation process underground, with the implementation of “entables” that constantly carry mercury. It is an archaic management, which uses a substance prohibited in Colombia for this type of use because of its harmfulness to humans and the environment. It is also a dangerous and highly destructive method for ground water and general water resources.

1. 1. 2. They only focus on mineral-rich resources regardless of the effects on natural resources. They do not mind wasting natural resources without taking into account processes of prevention, mitigation, remediation and compensation. Their focus is only on high-grade exploitation for the highest possible profits. In this way they leave other minerals forgotten, which becomes an inefficient process. Proof of this is that the Company’s ore recovery rate is more than 90% and that of these people does not reach 50%, with the aggravating factor of its polluting approach.

1. 1. 3. This anti-technical mining in Buriticá shows a lack of standards and no investment in industrial safety. Illegal mining does not implement Industrial Safety, Health and Environment or technical standards, it does not think about the integrity and work environment of miners. Because of this, there are constant safety accidents, injuries and even people killed in these activities. By entering these anti-technical sinkholes, the miners risk their lives.

1. 1. 4. Miners in the area are treated like slaves. Criminal activities have several modalities to take advantage of the work of these people and obtain profits. First of all, it is through the control of illicit mining. It also occurs through an agreement between these criminal organizations and the miners through renting land or charging them through extortion from ancestral miners. At the same time, these organizations control the miners through drugs, exploiting them so that they can obtain them, consume them and work tirelessly. This is clearly a perverse situation that affects the human rights of those who exercise this activity.

1. 1. 5. These criminal organizations threaten the national economy and damage social order. They exploit and smuggle gold without paying taxes or royalties to the country. This affects the Colombian economy. Most of the miners are foreigners who, due to their economic situation, accept these precarious conditions that affect their quality of life. At the same time, local populations are affected because these activities lead to an increase in drug consumption, prostitution, theft and in general environments of chaos, insecurity and social decomposition.

This increases deinstitutionalization in the territory, destroys the value system of the communities, their culture and affects the growth of young people and their expectations of life. Many of them succumb to the possibility of obtaining easy or illicit money, which affects the education and growth of the next generation of young people.

1. 1. 6. It threatens Zijin-Continental Gold’s normal operations and the company’s legal rights. Illegal Mining permanently and with impunity connects the Company’s tunnels from the surface, which also affects productivity, tools and machinery. In their actions they have managed to connect the ventilation system and the emergency tunnels. These facilities are at permanent risk due to the intention of these organizations to seize the mining panels through violence. To do so, they shoot and send explosives, which threatens the life and integrity of our employees, causing our daily operation to be frequently compromised. They act massively in the different ramps of the Company and since September 2021 they have invaded one of them (Yaraguá) completely.

Given the alarming situation affecting the legitimate mining operation carried out by the Company; the environment through the generation of irreversible environmental impacts; to the integrity of our workers, contractors, Public Force and the people who enter these farms without an adequate technical structure in terms of support and electrical connections, exposure to gases in deficient conditions of ventilation and countless conditions of insecurity that can trigger a catastrophic event, not to mention the economic detriment that the illicit extraction of minerals represents for both the Company and the State in terms of royalties and taxes, we request your urgent intervention to restore order and guarantee the development of an operation mining whose initial and main objective has been to contribute through modern mining, with a social and environmental vocation to the economic development of the country, which is not possible to achieve without its intervention. The situation is already critical and, if immediate and forceful actions are not taken, it will put an end to this project.

Mr. President, we want to state that as a Company we have denounced all illegal mining activities, maintained contact with different local, departmental and national authorities and we have made known to the public the critical situation that the Company and the municipality of Buriticá are experiencing, as a result of the flagelo of illegal mining and the criminal organizations that have a presence in the region. Likewise, until the month of August

2022 an inter-institutional table was established, coordinated by the competent mining and environmental authorities, the Ministry of Defense and the Ministry of the Interior, spaces where the existing problems were discussed in search of solutions and that would be extremely opportune to resume.

The Company expresses its willingness to participate in all scenarios of dialogue and particularly in the Dialogue Tables convened by the authorities, Ministries and Government entities, likewise the company has always expressed its willingness according to the government’s vision to expand formalization programs and thus give more opportunities to our neighboring communities framed in the law.

I take this opportunity to reiterate our Company’s commitment to the sustainable development of Western Antioquia and our conviction that the acceptance of local, departmental and national communities and authorities is the basis of legitimacy to advance this mining operation with the highest standards and thus be able to take advantage of natural resources responsibly and rationally, as is our mission.

Finally, we reiterate the high valuation that the Company, its Board of Directors, its Management team and employees have of the work carried out by the National Government, the Ministries, the environmental authorities, the departmental and municipal authorities, the Public Force, the organs of control and justice to ensure that in Buriticá and western Antioquia human rights and freedoms can be enjoyed, the environment can be preserved and the rule of law and democratic institutions is strengthened.

We respectfully attach presentation of our company.

Cordially

LEIZHONG LI

CEO

Zijin Continental Gold.

With copy to:

Iván Velásquez Gómez, Minister of Defense Rafael Lara Losada, Deputy Minister of Defense Iván Danilo Rueda, High Commissioner for Peace

Helder Fernán Giraldo Bonilla, Commander General of the Armed Forces

Luis Mauricio Ospina Gutiérrez, Colombian National Army Commander Óscar Murillo Díaz, 7th Colombian Army Division Henry Armando Sanabria Cely, Director General of the Colombian Police

William Castaño Ramos, Commander of Carabineros and Rural Security National Police of Colombia Carlos Humberto Rojas Pabón, Commander Region Six National Police of Colombia

Irene Vélez Torres, Minister of Mines and Energy Giovanni Franco Sepúlveda, Deputy Minister of Mines

Fernando Lozano, Director of Public Safety and Infrastructure Maríto Susana Muhamad, Minister of Environment

Alfonso Prada Gil, Minister of the Interior Rodrigo Negrete, Director of ANLA Álvaro Pardo Becerra, President ANM

Aníbal Gaviria Correa, Governor of Antioquia

Jorge Alberto Jaramillo Pereira, Secretary of Mines of the Government of Antioquia

Oswaldo Juan Zapata Quijano, Secretary of Security and Justice of the Government of Antioquia Francisco Barbosa Delgado, Attorney General of the Nation

Margarita Cabello Blanco, Attorney General of the Nation Carlos Hernán Rodríguez, Comptroller General of the Nation Carlos Ernesto Camargo Assis, Ombudsman

Roy Leonardo Barreras Montealegre, President of the Senate of the Republic of Colombia Juan Camilo Nariño, President ACM

Bruce MacMaster Rojas, ANDI President

María Bibiana Botero, Executive President of Proantioquia Luis Hernando Graciano, Mayor of Buriticá

Aicardo Antonio Urrego Úsuga, Mayor of Cañasgordas Alconides Úsuga Carmona, Mayor of Giraldo

Andrés Felipe Pardo, Mayor of Santa Fe de Antioquia

Sergio Cabrera Cárdenas, Ambassador of the Republic of Colombia to the People’s Republic of China.

Royal Road Minerals to acquire over 2000 square kilometers of appraised and prioritized mineral exploration titles and title applications containing drill-ready targets

Highlights of the Transaction

• High quality, Appraised and Prioritized Title Package. AngloGold Ashanti has elected to focus on its three advanced projects in Colombia and in Q2 of 2018, commenced a sales process for its exploration title packages outside of these three principal projects including the Titles as held under NC Holdings and ENC. These title packages are the result of systematic exploration, appraisal, prioritization and the purposeful reduction of land holdings by AngloGold Ashanti over the years since inception of its activities in Colombia in 2004.
• Increased Future Optionality. The Transaction will significantly increase the Company’s portfolio of potentially Tier 1 exploration assets and provides the Company with various options for joint-venture and cash generating transactions in Colombia
• Advanced Exploration Potential. The Transaction provides the Company with access to drill-ready potentially Tier 1 projects on granted concession agreements within its present area of interest and elsewhere in prospective mineral belts throughout Colombia

Click on images to enlarge

The Properties

The Titles are grouped into two blocks, the Southern Block, which is located contiguous with Royal Road’s existing 3500 square kilometers of exploration rights in Nariño Province and the Northern Block, which covers the well-known Middle Cauca Belt, a region hosting over 50 million ounces of recently discovered gold resources (see Figure 1). There are 16 currently identified individual gold project areas located within the title package and numerous underexplored areas which management believes host significant geologic potential. Royal Road’s initial focus will be on granted titles containing targets that can be moved to the drilling-stage as soon as possible. Some of these targets are as follows:

• The La Llanada project area in Nariño Province, characterized by very high stream sediment sample results and comprising several currently known high-grade vein-gold systems, (see Figure 2) and surrounding the La Redención mining license, over which the Company has an option agreement and is permitted to drill (see press release dated April 4, 2016)

• The El Tambo intrusion-related gold project in Cauca Province, where AngloGold Ashanti reported an area of steep-moderate dipping quartz-veins, up to 3 meters wide, over 3 kilometers in strike length and 600 meters in total zone-width and with rock chip results returning up to 77 grams per tonne gold (based on a reported 182 combined panel and grab rock-chip samples ranging from below detection limit and with a mean of 2.2 grams per tonne gold; Figure 3)
• The Güinter sheeted quartz-calcite-sulfide vein project area in Antioquia. The vein system has been mapped over 6 square kilometers, AngloGold Ashanti drilled 10 scout diamond drill holes for a total of 5662 meters at the project and reported best intersections of 56 meters at 1.1, 14 meters at 1.8 and 20 meters at 1.8 grams per tonne gold (not true thickness). Based on geological observations management believe there is volume potential in mineralized stratabound horizons and potential for higher-grade mineralization where veins link and interact similar in style to the nearby Buriticá and Anzá projects (Figure 3).

The title package contains numerous porphyry-style occurrences and two well-known porphyry copper and gold projects that whilst not drill-ready, will be the short-term focus for Royal Road’s social and permitting teams

• The El Molino porphyry gold project (Figure 4) is an outcropping gold porphyry system located in Cauca Province. Both the potassic core and quartz-sericite halo of the system are exposed on surface. AngloGold Ashanti previously reported sheeted gold veinlets returning rock-chip samples of up to 184 grams per tonne gold (based on a reported 493 combined grab and panel samples ranging from below detection limit with a mean of 2.5 grams per tonne gold; Figure 3).
• The Caramanta region in Antioquia, where AngloGold Ashanti reported three copper and gold bearing porphyry bodies and rock-chip results of up to 47 grams per tonne gold and 3.3% copper (based on 255 combined grab and panel samples ranging from below detection limit with a mean of 0.65 grams per tonne gold and 0.07% copper).

Transaction Details

All figures are in United States dollars unless otherwise indicated.

Under the terms of the Agreement, the Purchaser agreed to acquire from the Seller all of the issued and outstanding shares of NC Holdings. NC Holdings indirectly holds, through two wholly owned subsidiaries, all of the issued and outstanding shares of ENC, which is the holder of the mineral concession Titles and is the assignee of the rights to any Titles that are granted to AngloGold Ashanti Colombia S.A. (the “Assigning Company”), an affiliate of Anglo Ashanti, pursuant to title applications made by the Assigning Company to the National Mining Agency of Colombia (Agencia Nacional de Minería).

In consideration for the purchase of the shares of NC Holdings, the Company agreed to pay the Seller a purchase price of $4,655,462 on completion of the Transaction. In addition, the Company has granted the following contingent considerations to the Seller:

• If at any time after the closing of the Transaction, Royal Road Minerals completes a technical report pursuant to NI43-101 that discloses for the first time an inferred mineral resource of not less than one million gold equivalent ounces on a specific area within the lands subject to any of the Titles held by the Company or any of its affiliates, such specific area shall be designated as a “Specific Project”, and the following provisions shall apply with respect to each such Specific Project identified:

o An amount equal to five million dollars ($5,000,000) shall be payable within 90 days following the date on which such technical report for the Specific Project is completed; and

o a further amount equal to five million dollars ($5,000,000) shall be payable within 90 days following the date on which a feasibility study for such Specific Project is completed and delivered to the Seller; and

o a further amount equal to five million dollars ($5,000,000) shall be payable within 90 days from the commencement of commercial production for the Specific Project; and

o a further aggregate amount equal to twenty million dollars ($20,000,000), payable in four equal installments of five million dollars ($5,000,000) on the date that is 90 days following the end of each of the Company’s four consecutive fiscal quarters immediately following the commencement of commercial production for the Specific Project.

• If at any time after Closing, the Company completes a feasibility study that discloses for the first time an inferred mineral resource of not less than five million gold equivalent ounces on a Specific Project, the Seller shall have a one-time option (the “Feasibility Option”) to purchase a 75% interest in the Specific Project for a purchase price in an amount equal to the sum of the following amounts:

o An amount equal to three (3) times the aggregate sum of all exploration expenditures up to and including the feasibility study funded by Royal Road Minerals; plus

o An amount equal to the aggregate sum of all exploration expenditures funded by Royal Road Minerals for that Specific Project from the feasibility option date until the completion of the transfer of the purchased interest.

If the Seller exercises the Feasibility Option for a Specific Project, then the Company will no longer be required to pay the payments on and following commercial production for the Specific Project for which the Seller has exercised the Feasibility Option.

The Agreement contains customary representations, warranties, covenants and conditions for transactions similar to the Transaction. In addition, the obligations of the Company to complete the Transaction are subject to the fulfilment of certain conditions on or before the closing of the Transaction, including, among others, the following conditions:

• The Company shall have completed a financing for aggregate gross proceeds of at least $3.5 million on or before the date that is 60-days from March 4th 2019; and
• the Company shall have obtained any required approvals of the TSX Venture Exchange and the relevant authorities in Jersey in connection with the acquisition contemplated by this Agreement.
• The Seller shall have obtained the required approval to implement the Transaction from the South African Reserve Bank.

The Transaction is expected to close on or before the date that is 60-days from March 4th 2019, subject to the approval of the TSX Venture Exchange and the other conditions precedent set out in the Agreement.

Paul Harris is a mining consultant in Colombia, publisher of the Colombia Gold Letter, and organizer of the upcoming Colombia Gold Symposium.

Loren Moss: AngloGold Ashanti recently made global news because of its operations here in Colombia. A town where the company has operations, or where its have rights, voted 6,165 versus 76 to ban any mining activities, if I understand correctly, in the area where AngloGold had planned on making a large open-pit gold mine. What are the implications of that, and where are we now?

Paul Harris: The plan is to develop an open-pit gold mine that would certainly be the largest in Colombia. I think this vote has shown several things. One is that the company obviously hasn’t done a sufficient job of outreaching to local communities and key stakeholders to communicate what their plans are and how that could help local people and local development.

We did some back-of-the-envelope calculations. I think the project has got over 23 million ounces, and they’d be looking to produce over a million ounces a year. So — just using really back-of-the-envelope rough approximate calculations given the current gold prices — if that project was in production, the government would be receiving, in taxes and royalties, well over $400 million USD a year.

The government can do an awful lot with that kind of money, particularly given that it’s got a peace process to pay for, to develop a country. So, you’ve got a situation where 6,000 people are perhaps holding the whole country ransom. 6,000 people is far from being the majority of the voting population in that area, and they’re voting against the project.

What information are they using to make their decision to make their vote? AngloGold Ashanti hasn’t filed an environmental impact statement yet, and that’s the document that basically says to the government and the environmental authorities in Colombia what they plan to do, what the environmental impacts of that are likely to be, and the remediation or mitigation measures they’re going to put in place to counter those.

So, people were voting when there’s no real information yet in the public space about what they’re going to do. AngloGold Ashanti is a publicly traded company. It’s a very responsible company. It operates in various countries around the world. They are going to use state-of-the-art, current best-practice technology.

The people in Cajamarca, from what I read, their fears are about water. Potential competition for water resources or potential damage to water resources. Cajamarca has competing economic interests in terms of rice-growers. These are potentially the people that stand to suffer most.

Loren Moss: Rice is a water-intensive crop.

Paul Harris: It is, and if you look at how efficiently water is used there, or elsewhere in Colombia, it isn’t. People assume water is a free good. You drive anywhere in Colombia, you see places where the trucks can be washed — the water is just free-flowing. People do not use water efficiently. They do not conserve water. They consider it a free good.

Mining uses a tiny fraction of the available water source in Colombia. Agriculture uses dozens of percentage points of the available water sources. You’ve got these entrenched economic power structures, such as the rice-growers. But what’s their big issue? If you build a big mine, you’re going to have competition for labor, and mining is well known for being the sector that pays best, not just here in Colombia, but pretty much in any country in the world, mining pays best.

So, you’ve got these entrenched, economic, political powers that suddenly face potential increase in their costs. And bear in mind agriculture in Colombia is basically no different to serfdom. A lot of agriculture pays less than the minimum wage. People are almost indentured to the land. It doesn’t bode well for the people that own the means of production. So, I suspect, to a large extent, they’re one of the forces behind the campaign to stop La Colosa coming into production.

Loren Moss: Has AngloGold made a mistake in perhaps focusing their lobby and focusing their outreach on Bogotá — on the political sector — to the detriment of maybe being on the ground and starting off painting themselves as a protagonist rather than an antagonist? What could they have done better or differently? And now, is there a way for them to go in there and maybe fix the situation?

Paul Harris: I think in this instance, that’s a valid premise. AngloGold Ashanti has been in Colombia for over 10 years, and I think initially the senior management team they had in place really did focus its attention on the government in Bogotá, and to a certain extent ignored the local political scene, the mayors, and the governor. That failure to communicate outreach really early on has had quite a large ripple effect going forward.

The company, several years ago, called in new management, got rid of a lot of lawyers. Lawyers tend to see everything as a legal problem when mining really is a social thing. You may legally be right, but that’s almost a distraction — and that doesn’t matter. I remember years ago, AngloGold Ashanti threatened to sue the local government — I can’t remember if it was departmental or municipal — because the mining law said it has rights to do certain things and it wanted the local authorities to jump to it. You’ve got to let us do this, or we’re going to sue you.

Obviously, that antagonized and alienated all the local authorities and they put up their defensive shields. Lawyers see things as legal issues, but it’s a social issue. You’ve got to outreach, you’ve got to engage, you’ve got to show the shared benefit, you’ve got to paint the picture for the future.

Loren Moss: Sales. You’ve got to sell it.

Paul Harris: There was a management change a few years ago, and this management is much more focused on engaging with the local community, but once a negative environment has developed, it’s very difficult to repair that damage. It takes a lot of time, and a lot of time, and a lot of time. It needs a lot of openness, honesty and engagement.

AngloGold Ashanti has developed a lot of information to counteract some of the myths surrounding its project, but how deeply has that penetrated? That’s going to be a task that may take many years to get a level of understanding, to change people’s entrenched opinions. Once people’s opinions are entrenched, it is difficult to change them, particularly when they form their opinions on the absence of fact.

Now, AngloGold Ashanti does perhaps have a card up its sleeve here. It’s the 51% owner of the Gramalote Project here in Antioquia, which is permitted into production. It already has it environmental license. It’s a smaller project, but still a decent-sized one. So, one possibility is that AngloGold Ashanti could bring Gramalotte into production.

It’s also an open-pit gold project, so the company could show the people of Colombia, show the national government, show the people of Cajamarca and Tolima, that it can develop an open-pit mine responsibly. It can protect water sources. It can respect local communities and develop economic activities for local miners and farmers. It can, in short, have a very positive impact for the development of the region.

And then, the company can go back to Tolima and say “Look, we’ve done this responsibly. We’ve done it well. Give us the chance to do a similar thing with La Colosa for the benefit of everybody.”

Loren Moss: From your understanding of how mining works in Colombia, the legal framework for mining, what is your prognosis? There are a lot of unknowns, of course. But the local citizens have voted, and they said “No.”  At least for those that participated, it was very overwhelming. And now we hear things that put the government in a bind because the government does not want to lose this major economic opportunity. But on the other hand they don’t want to look like they’re ignoring their own voting citizens. What are the possible solutions? Do you think there’s room to manoeuver, and where might we see things two years from now?

Paul Harris: Well, again I repeat: Did people really know what they were voting for? I would say no. But it has produced a situation. The courts in Colombia have said in their rulings that local communities must have a say. Local communities and municipalities must have a say in their land use and whether mining is part of that.

But the state is owner of the resources, which are administered by the Mining Ministry and the National Mining Agency. They’re the ones that implement policy.

So there is a bit of conflict of opinion or jurisdiction if you like. The national government has very much said that the jurisdiction is with us and that the local authority doesn’t have jurisdiction over such things. So, on the one hand you’ve got the national government being supportive of AngloGold Ashanti.

But secondly, I think it shows that government in general needs to work out a solution to bring both sides together, meaning the national government policy and local government participation. Whether that’s through a law or a decree, it’s for the government to establish a functioning mechanism that marries both the national government and the local government together. That, to me, would seem to be something that’s quite urgent to resolve.

We will see. Unfortunately, government policy here in terms of writing new law hasn’t been very successful or efficient in recent years. This is one of the reasons why the courts have stepped in to say “you can’t do this” and “you can’t do that.” But there’s definitely a need for clarity, and that’s got to come from government.

Loren Moss: You’re the CEO of AngloGold. What strategy do you employ to try to make sure that you get a positive outcome?

Paul Harris: A company like AngloGold Ashanti is a company that plays the long game. They’ve been here for 10 years. It takes a long time to find, explore and bring large deposits into production. If I was in charge, we would keep engaging the national government, and more importantly we would keep engaging the local government.

You know, times change. Opinions change. Elected officials change. You be a good corporate citizen, you do all the right stuff, you communicate honestly and openly. And as I mentioned previously, they’ve got the ability or the option of developing this other project as a means of showing people the “true mettle” of what they can do. Other than that, communicate, communicate, communicate. Invite where necessary, invite people to the projects, perhaps invite people to similar projects elsewhere to see how responsible mining companies run their operations.