Paraguay - Mining

Paraguay's mining potential has been restricted by limited exploration, inadequate infrastructure, large fiscal and trade deficits, scarcity of foreign exchange, and limited private investment, and the reforms deemed necessary to alleviate the country's economic stagnation were impeded by the political uncertainty. The mineral industry accounted for less than 1% of GDP, and was focused on the production of cement, the country's second-leading industry in 2002, and the extraction of industrial minerals such as clays, gypsum, limestone, marble, ocher, sand (including glass sand), and pryophyllite soapstone talc. No minerals were among the country's top export commodities. Production for 2001 included 66,500 tons of kaolin and 600,000 tons of limestone. In 2001, Paraguay also produced lime, rock, dimension stone, other stone, and weathered tuffs. In addition, sandstone, mica, copper, and salt have been exploited modestly in recent years as well.

There were small deposits of iron ore, and a few mines were worked before 1865, but there was no evidence, until recently, of any metallic mineral deposits of commercial value. Lateritic iron ore deposits along the Paraná River, near Encarnación, were estimated at 300 million tons with 35% iron. Manganese deposits were known to exist near the Guairá Falls. Excellent limestone, found in large quantities along the Paraguay River, north of Concepción, was quarried for the cement industry. There were also known deposits of azurite, barite, lignite, malachite, peat, pyrite, pyrolusite, and uranium. Under Paraguayan law, all mineral rights belonged to the government, which has sought to encourage mining development by the privatization of some state-owned companies. A diamond-drilling and igneous exploration program begun in 1997 was completed, and there was ongoing exploration throughout the country by foreign companies.