Shares tanked on the news, bring year-to-date losses to more than 50%
Shares in Latin America-focused Tahoe Resources (TSX:THO)(NYSE:TAHO) collapsed Friday after a Guatemalan court upheld the suspension of the company’s license to operate Escobal, the world’s third largest silver mine.
The Canadian miner said the court decision responds to an appeal filed by its Guatemalan subsidiary, Minera San Rafael, in an action brought by the anti-mining group, CALAS, against the country’s Ministry of Energy and Mines in May.
The organization alleged Tahoe violated the local indigenous people’s right of consultation in advance of granting the Escobal mining license to Tahoe’s local unit.
Originally, Tahoe was prepared to face a three-month mine suspension, period during which 5.1 million ounces of silver production were expected to be deferred, about $10 million lost, not to mention the fact the company would have to review its previously issued guidance.
Today’s ruling means operations at the Escobal mine will have to remain halted longer than expected. At the same time, the company said the main road to the mine continues to be blocked by protestors and, despite ongoing efforts to solve outstanding issues with locals, the blockage “shows no signs of immediate resolution.”
For the rest of this article: http://www.mining.com/guatemalan-court-backs-tahoes-escobal-mine-suspension/