TSX- and NYSE-listed Tahoe Resources has restarted mining operations at the La Arena mine, in Peru, and has shed more details about its understanding of the Guatemala Constitutional Court’s resolution related to the Escobal mining licence.
At La Arena, Tahoe said on Friday that mining operations had resumed following an eight-day suspension as a result of a protest over the alleged impacts of dust and vibration from blasting activities on the La Ramada community.
The company and the community have agreed to a formal dialogue, which is being held under the auspices of the Ministry of Energy and Mines.
The suspension, combined with a labour strike in the second quarter, will result in production at La Arena coming in at the lower-end of its guidance for the year. The mine is forecast to produce between 160 000 oz and 185 000 oz in 2018.
Meanwhile, CEO Jim Voorhees said that Tahoe was disappointed that the Escobal mine, in Guatemala, would remain suspended during a court-ordered consultation process with the Xinka community, but said that the court resolution provided some certainty after a prolonged period of inaction in the legal system.
“The final resolution provides a comprehensive path forward for the Ministry of Energy and Mines (MEM) to conduct the ILO 169 consultation, as well as the specific requirements of each of the parties involved. Upon the completion of the consultation process and the other requirements outlined in the resolution, we expect to be in a position to restart operations at Escobal.”
The Escobal mining licence was suspended in July 2017 after an anti-mining organisation claimed that the Xinka indigenous people were not consulted before the licence for the large silver mine was awarded.
Tahoe said that the ILO 169 process, which follows a United Nations International Labour Organisation convention regarding indigenous and tribal peoples, did not contemplate a veto of development projects. In the case of the Escobal mine, a successful consultation process would identify any concerns from the Xinka indigenous communities in the area of influence and seek to determine acceptable mitigations to those concerned in order for the mine to restart operations.
In addition to the ILO 169 consultation process, the Constitutional Court also established other requirements that had to be completed as a condition for an Escobal restart, including studies related to archaeology, health, and environmental compliance to confirm that the mine was meeting required standards.
“It is our firm belief that a productive Escobal is in the best interest of all of our stakeholders, including the government of Guatemala, our workforce, the local communities, the indigenous communities, our suppliers, and Tahoe’s shareholders. We will respect the court’s decision, and we will support MEM in fostering a thorough, productive, and good-faith consultation process with the goal of restarting operations at Escobal in a manner that is mutually agreeable to the Xinka indigenous communities included in the ILO 169 process,” Voorhees said.
The September 3 court resolution did not define a timeline for the completion of the consultation process, although Tahoe pointed out that it mandated that all parties had to agree to a satisfactory timeline during the pre-consultation stage.
“While we cannot predict the timeline for completion of the consultation process, in a case involving the OXEC hydroelectric plant, MEM completed the consultation within six months.”
Voorhees said that Tahoe would use the time to engage with community members who were interested in productive dialogue with the company. Once this process is complete, we look forward to restarting operations at Escobal and becoming a contributing member of the Guatemalan economy once again.”
Tahoe’s share price on the TSX tumbled to a 52-week low of C$3.36 a share on Friday, but closed 10% higher at C$3.76 a share. The company’s 2-week high is C$8.50 a share on September 11, 2017.