Gran Colombia progressing with Marmato resettlement

TORONTO, Jan. 9, 2012 /PRNewswire/ - Gran Colombia Gold Corp. (TSX: GCM) today provided an update on the progress of its Marmato Project, located in the Department (State) of Caldas, Colombia. The Company will hold a conference call on Wednesday, January 11, 2012, at 11:00 a.m. (Eastern Time) to discuss the progress at Marmato, the details of which are located at the end of this news release.

Miners' Negotiations

On November 28, 2011, the Secretary of the Department of Caldas, Fernando Alvarez Hely Mejía, confirmed the Department's commitment to assist Gran Colombia in reaching an agreement with artisanal mines within the Company's concession at the Marmato Project, which negotiations are well underway.

At the Marmato Project, there are a few formal mining titles still to be acquired, as well as certain artisanal miners which need to move their operations.  There are a total of 15 mining titles at Alto El Burro that the Company requires, and since starting negotiations in early November, it has reached agreement with ten (67%) of the owners.  At Chaburquia, Echandia and Cien Pesos, there are a total of 76 artisanal mines, representing 501 workers, and since starting negotiations in early November, the Company has reached agreement with 49 (65%) of these mines, representing 228 workers, and is in the midst of negotiations with the remaining 27 (35%).  Under these agreements, the artisanal mines will continue to operate for up to two years, at which time the Company anticipates commencing large scale mining at the Marmato Project. The Company has also implemented an environmental and safety training program for the artisanal miners, which will not only serve to immediately improve environmental and safety conditions at Marmato, but will lay the groundwork for these artisanal miners to be available for employment by the Company at its open-pit mine at Marmato once constructed.

The Company still has to negotiate with the remaining artisanal mines at Chaburquia, Echandia and Cien Pesos, as well as with the remaining title-holders at Alto El Burro.  It is anticipated that almost all negotiations will be completed by the end of the first quarter of 2012.

Marmato Resettlement Progress

In order for the Company to build the open pit operation at Marmato, the existing town of Marmato will need to be moved and the existing residents re-settled to nearby areas including the town of El Llano, approximately 1.5 km away.  The new town of El Llano will be a planned, modern community with proper streets, sewage, utilities and clean water, which is important in a district where only 53% of the homes have running water and only 56% are connected to a sewage system.  Also, as it sits in the valley next to the El Burro hill on which the Town of Marmato is situated, El Llano will not be subject to the periodic landslides that afflict Marmato.

In connection with the resettlement, Gran Colombia has engaged Social Capital Group, a company with extensive experience in community resettlement in South America, to complete a population census and a socioeconomic survey of the community.  The results of the census will serve as a framework for the Company to establish compensation parameters, appropriate income restoration and sustainable development initiatives in the new resettlement area. The census is also designed to ensure the mitigation of any adverse effects, and help verify that the benefits of resettlement of the Town of Marmato are appropriate and sustainable.

Work conducted by Social Capital indicates that there are approximately 203 homes in the Town of Marmato (1,370 in the town and surrounding district) with a population of 749 people (5,424 in the town and surrounding district).  In the town and surrounding district, 97.6% (2,232) of people of working age are employed, of whom 998 (44.7%) already work for Gran Colombia at its Mineros Nacionales mine or in exploration, planning and related activities.

The exact number of people to be resettled will be included in the Resettlement Action Plan, which is currently being prepared by Social Capital.  The Plan is expected to be completed in early 2012 at which time the Company will engage national, regional, local and community leaders, as well as the Catholic Church and independent NGOs, to work together to resettle the people of Marmato. As part of this engagement process, Gran Colombia has recently commenced a door-to-door information campaign with the objective of informing the community about the resettlement process and assessing and addressing the concerns raised by the community. Initial results indicate that, only 30 days into the process, at least 41% of the community supports the resettlement process.

Recognising the importance of the local Roman Catholic Church to the fabric of the Marmato community, Gran Colombia has commenced working with the Archdiocese to enlist their help in the socialisation and proper implementation of the plans for relocating the community.

In addition, Gran Colombia has hired BSD Consultants, a Switzerland-based consulting group with offices in Colombia, which has broad experience in implementing corporate responsibility and sustainable development projects within Colombia, to advise the Company on land purchases and the design, management and implementation of a sustainable urban development plan for the resettlement of the Marmato community. BSD will also assist the Company in developing and implementing social, local and institutional development programs in the local community.

The Company has also engaged Replan, a Canadian organization with more than 30 years of experience specializing in managing social, economic and housing dimensions of resource development projects, to perform an audit on all processes for the resettlement of Marmato and to provide recommendations based on such audit.

Gran Colombia continually re-affirms its commitment to social responsibility initiatives in the Town of Marmato, and recently contributed approximately US$2 million to the town and its surrounding area, to be used to fund Phase II construction of the El Llano Hospital, the construction of an administrative centre and other community projects. Through its Mineros Nacionales mine, Gran Colombia already pays royalties of between 0.4% and 4% to the national government and a 6% special administrative fee for certain of its mining titles payable to the local authorities in Marmato, totaling US$1.9 million alone for 2011 (to September 30).  The Company, as it has done for the social development of the Segovia district, also intends to establish a special purpose foundation, funded out of production from the Marmato Project, the sole purpose of which will be the improvement of social conditions in the Marmato district.

Gran Colombia regards the Marmato resettlement as an opportunity to improve the livelihoods and the future development of the Marmato community and such planning is being undertaken by the Company in strict accordance with international standards for resettlement as recommended by the World Bank in their International Financing Corporation guidelines.

Gran Colombia has also become a member of Canadian Business for Social Responsibility (CBSR), which is the Canadian representative in a world-wide network committed to corporate social responsibility, and which will assist Gran Colombia by providing key findings, opportunities and recommendations to our policies and programs, to ensure that they are all to international standards and guidelines.  CBSR will also facilitate some of the processes that the Company is implementing by providing their insight and experience.

Appointment of Director of Sustainability

The Company is also pleased to announce the appointment of Luca Altamura as Director of Sustainability of the Company, effective November 15, 2011.  Mr. Altamura's focus will be on managing the Company's social and community relations, and corporate social responsibility.  Mr. Altamura is already actively involved in the negotiations with the artisanal miners on behalf of the Company and has engaged directly with the community of Marmato with respect to the resettlement of the town.

From 2010 to July 2011, Mr. Altamura was the Associate Protection Field Officer for the Office of the United Nations Commissioner for Refugees based in the Caquetá Department of Colombia where he was responsible for assessing the needs and social conditions of internally displaced persons and providing counseling and support through the UN and local authorities in Colombia.  He was also responsible for the supervision and co-ordination of certain work related to community service, public policy, education, law enforcement, land and property in the Department of Caquetá. In 2008, Mr. Altamura served as an Intern International Mediator in San Diego (California) and practiced law in Italy from 2003 to 2008.

Mr. Altamura holds a law degree from the University of Federico II (Naples, Italy), and has obtained a PhD in Administrative Law and a Masters in International Law.  In addition, he has completed several post graduate courses in various subjects including Peace and Human Rights, International Mediation for the UN, and International Conflict Resolution.

"We are delighted to have Mr. Altamura as part of the Gran Colombia team.  Mr. Altamura brings to Gran Colombia considerable knowledge and experience in adopting and implementing social policies and resettlement programs for populations that need to be moved," said Maria Consuelo Araujo, the Chief Executive Officer of the Company.

Conference Call Details

A conference call will be held on Wednesday, January 11, 2012, at 11:00 a.m. Eastern Time, to discuss the progress at Marmato.  The call-in details are as follows:

A playback of this conference call will be available by dialing 416-849-0833 or (855) 859-2056 with the above conference ID number until January 25, 2012.

About Gran Colombia Gold Corp.

Gran Colombia is a Canadian-based gold and silver exploration, development and production company with its primary focus in Colombia.  Gran Colombia is currently the largest underground gold and silver producer in Colombia with six underground mines in operation.  In addition, Gran Colombia is also developing a large-scale, open-pit gold and silver mine at Marmato.  The Company also has a highly-prospective land position in Colombia as well as an advanced stage property in Venezuela and earlier stage properties in Mali.

Additional information on Gran Colombia can be found on its website at www.grancolombiagold.com and by reviewing its profile on SEDAR at www.sedar.com.

Cautionary Statement on Forward-Looking Information: 

This news release contains "forward-looking information", which may include, but is not limited to, statements with respect to the future financial or operating performance of the Company and its projects. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Gran Colombia to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements contained herein are made as of the date of this press release and Gran Colombia disclaim, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management's estimates or opinions should change, or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements.

SOURCE Gran Colombia Gold Corp.