Hochschild considers reactivating Gonzalito mine in Río Negro

Friday, May 25, 2007

Peruvian firm Hochschild Mining is considering reactivating the Gonzalito polymetallic mine located in southern Argentina's Río Negro province.

"The company has already presented, as required by law, an environmental impact assessment for each of the areas it was granted at the Gonzalito mine," provincial mining director Gustavo Bevacqua told BNamericas.

The provincial mining authority and environmental regulator Codema are reviewing the documents, "to issue the correct resolution," he said.

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A Hochschild executive confirmed the company's plans.

Once the Peruvian miner secures environmental permission it will be able to begin exploration to decide whether to reactivate the mine, which will require an estimated investment of US$300,000-500,000, Bevacqua said.

Argentine company Geotécnica operated the Gonzalito mine until 1983, extracting lead, zinc and silver, until it was forced to shut down when metal prices plummeted, he said.

Argentine mining authorities are currently carrying out a plan to correct environmental liabilities left by the mining operation, located near San Antonio bay.

In Argentina, Hochschild Mining also holds 51% of the San José silver-gold project located in Santa Cruz province. US company Minera Andes (TSX: MAI) owns the remaining 49%.

Both companies also operate the Huevos Verdes and Frea gold-silver projects in the country.