It sounds like you have to do a lot of talking in this section of the game and if you overlook a conversation or something else, you most likely won't be able to proceed.
Here is what the walkthrough says:
Talk to the guard about the ship (2) and the music. Look at the hut. Talk to the man near the hut about Condor Transglobal and the statue. Talk to the man with the fishes near the band about the fish and the statue. Talk to the band members about Miguel, music, the accident, the biscuits, the stone, the statue, the worm, Condor (2), the news cutting. Talk to Pearl about Duane (3), Pearl, stone, dart, statue, worm, news cutting. Talk to Duane about him, Karzac, music, Miguel, pearl, driving, truck, biscuits, coal, Condor, panties. Talk to the man without legs about accident, stone, statue, Condor twice, news cutting, panties.
Talk to the General about everything possible. Talk to Renaldo. Talk to Nico. Talk to General about the map of Quaramonte. Go outside. Talk to Nico about map, General. Talk to Pearl about the General. Talk to band about the General. Talk to Oubier about everything. When you ask about his wife choose the icon of the woman. Talk to Duane.
Climb up the stairs to the Mining company. Talk to Conchita about everything. Did you notice what happened when you asked her about the coal. Talk to the secretary.
Leave this place. Talk to Duane. Lie about the detonator. Go to the Mine Co. Talk to Conchita again. Get out again and talk to Nico. Talk to the General (Nico will distract him). Use the chart. Talk to Renaldo (he's a tourist guide). Get out and talk to Pearl. Use the chart again. Go to back where the jail is. Talk to Miguel. Go to the Mine Co. Talk to Conchita. Open the cabinet to get the detonator. Take the detonator and go to Duane to give it to him. Go back to the jail. Talk to Miguel about the escape plans.
That's a lot of talking and conversations, so make sure you have done each and every thing.