TORONTO (miningweekly.com) – Colombia-focused Continental Gold on Monday reported that it had signed formalisation subcontracts with five of seven small-scale mining associations, paving the way for implementing legal and responsible small-scale mining operations at the company's Buriticá project.

The remaining two subcontracts were expected to be signed following a review by the Secretary of Mines of Antioquia.

These subcontracts were the first to be executed under Law 1658 of July 15, 2013, and would be regulated by Decree 480 of March 6, which placed all legal responsibilities on the individual small-scale mining associations and devolved the company in this regard.

Once these small-scale mines start operations in the coming months, 583 families were expected to benefit directly, which, in turn, would indirectly benefit the local economies, communities and the government's tax base.

Further, the subcontracts would provide the blueprint for other regions of Colombia in governing how mining companies, small-scale miners and government can operate symbiotically, while simultaneously deterring non-sanctioned mining activities within a specific area.

For Continental, none of the seven areas jointly selected between the company and the small-scale mining associations would impede on Continental's current and future operations. A 50 m depth restriction from surface would be implemented, rendering these operations above the limit of a crown pillar at the top of the deposit built into the company's future mine plans.

“We are delighted for the miners involved in this process, and are proud that they have decided to incorporate the law into their mining operations. We look forward to working jointly towards the implementation of these new small-scale mines,” Continental president and COO Mark Moseley-Williams said.

"The execution of these subcontracts is a landmark triumph for Colombia and represents an important milestone in the maturation of the Colombian gold mining industry. The harmonisation between the Colombia government, the company and small-scale miners resulted in this positive outcome and all parties should be proud of their respective efforts,” CEO Ari Sussman said.

The Buriticá project has combined measured and indicated resources totalling 1.6-million ounces of gold, grading 13.6 g/t and the combined inferred resources totalled 3.8-million ounces of gold grading 8.8 g/t.