CASILLAS, Guatemala (Reuters) – A bitter drama playing out over a Guatemalan silver project forced to close by the courts has shocked miners throughout Latin America, sounding a warning to firms to approach indigenous issues more cautiously or pay the consequences.
Work at the Escobal mine, where U.S.-based Tahoe Resources has invested more than $500 million (395.3 million pounds), was abruptly suspended last year by judges pending consultation of nearby indigenous Xinca communities, a decision upheld by Guatemala’s top court in September.
Leaders of the Xinca, a mainly farming community which claims a 400,000-strong population, oppose the mine due to worries it will harm their ancestral land and water resources.
The court ordered the mining ministry to “immediately” begin consultations, although the process is already bogged down in litigation over which specific Xinca towns should take part.
The slow-burning squabble illustrates the pitfalls firms can face from determined and increasingly sophisticated opponents, often a combination of environmental activists and local communities, according to company executives and sector analysts.