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The Colombian countryside, in the vicinity of Greystar Resources' Angostura project

With geopolitical risk emanating from such troubled countries as Libya, it's easy to forget that much safer countries still pose many problems when doing business.

Greystar Resources is learning this through first-hand experience after the Colombian government failed to grant it the environmental approval it needs to take its Angostura gold-silver project to the next level. The project faces opposition because the residents of Bucaramanga, a city with more than a million people about 50 kilometres away feared their water would be contaminated through the development process.

There was some confusion late last week because some people thought Greystar was pulling out of the project completely, but that has since been clarified and Greystar said it is looking at alternative solutions.

Still, the news isn't good no matter how Greystar tries to spin it. The company's stock price reflects this. Greystar is down about 30 per cent over the past month.

It's a big shift. For years, Greystar was heralded as the flagship project of Canadian miners in Colombia. Over time, more companies set up shop there and some, like Ventana Gold, got big enough to attract eyeballs. Now, however, Canada's presence is waning. Just before the Greystar dilemma broke, Ventana was taken out by Brazilian billionaire Eike Batista.

Greystar isn't the only Canadian miner to face political uncertainty of late. A few weeks back Inmet Mining took a hit after the Panamanian government announced its plan to repeal a mining law that allows foreign ownership of mining projects within its borders. The news hits in the midst of Inmet's battle to merge with Lundin Mining.

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