Guatemala: Tahoe defends environment, community record at Escobal mine

Friday, December 6, 2013

Vancouver-based Tahoe Resources (TSX: THO, NYSE: TAHO) has defended its environmental and community relations record after an NGO representing indigenous Xinca people in Guatemala urged authorities to cancel the company's Escobal silver-lead-zinc mine.

The Parlamento Xinca (Xinca parliament) said the US$326.6mn mine, in San Rafael Las Flores municipality, is opposed by the majority of people living in the area, according to a report by Spanish news agency EFE, with the group citing a survey in which 23,000 said they were against the mine, compared to 399 who supported it.

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The NGO also said the mine was causing environmental contamination, although no details of any specific claims were reported.

Tahoe declined to comment on the press reports, but an official from the company told BNamericas the mine has "fantastic support" from the people in Santa Rosa department.

The company employs about 800 workers, plus additional contractors and vendors, and 100 new businesses have been created in San Rafael Las Flores municipality to support employees, and the support is "very positive."

The mine has a "very favorable impact" on Guatemala, the official added, with 42% of revenue remaining in the country in goods, services, payroll, taxes and royalties.

Escobal is a "very clean and responsible" operation, with the flotation process used at the mine generating no acid and requiring no tailings pond.

"Our goal from day one has been to make Escobal the benchmark for environmental stewardship. Claims disputing that are unfounded," the official added.

The mine has been affected by protests, some of which have turned violent, and the Guatemalan government temporarily imposed a state of emergency in the area in May, citing chaos linked to drugs cartels.

Escobal, currently in the ramping up stage, is expected to produce 21Moz silver next year, and Tahoe CEO Kevin McArthur has said the company aims to add a second mine in Guatemala.

For a more on mining in Guatemala, see BNamericas' latest Intelligence Series report.