PARAGUAY: OPEN FOR BUSINESS

Paraguay has established iron reserves, in the south of the country, along the Paraguay River and near the capital. It is likely that there is much more iron in the unexplored Chaco region. Once again, high iron ore prices are making exploration worthwhile. The new excitement, however, focuses on Gold and Uranium, which have been found in Paraguay and extracted informally by locals, but is not yet commercially mined. Most of the investment is coming from Canada, in particular the companies Latin American Minerals, Cue Resources and Crescent Resources. Cue’s COO Chris Healey was quoted as saying last month, to Business News Americas, “People are just starting to realize that there is something there. There is a lot of potential for gold, probably base metals, certainly uranium.” Of the new government, he says: “They are very keen on getting foreign investment and the new government is pretty favorable for us.”

This is another thing Paraguay has an abundance of. The land exists, is fertile and natural irrigation is easy. It is virgin. There are no people there. So nobody got around to developing it or putting in roads. High prices for soya, beef and other commodities have changed this. Argentina’s ban on beef exports has helped too… Argetinian farmers can’t export beef any more, so they are quietly exporting their whole beef industry with all its expertise instead… to Paraguay. Meanwhile Brazilian farmers, hurt by the strong real, are also looking to reduce costs without having to move far from their familiar territory. Where are they headed? You guessed it – Paraguay.

The Bolivian territory directly to the north-west of Paraguay has South America’s second largest natural gas reserves (second to Venezuela). It doesn’t take a genius to figure out that Paraguay’s northern Chaco bordering Bolivia might have similar resources. And that the country’s economy could transform almost overnight with a big find and the start of commercial production. The simple fact is there have been easier areas in the world for oil and gas exploration and distribution, which is why after the Suez Crisis big oil companies like Texaco who were looking for oil in Paraguay invested in exploration elsewhere. But with the high prices of today, exploration in remote areas is worthwhile, and technology makes it easier. Oil and gas companies like Pantera Petroleum from the USA and CDS Oil and Gas UK are already there exploring and claim already to have identified substantial reserves.