Stoppage at Newmont Goldcorp mine costs Mexico millions daily

Ongoing stoppages at Newmont Goldcorp Corp’s Peñasquito gold mine in Mexico are costing “millions” every day to both public coffers and the company, a Mexican minister said on Thursday, urging a solution that will restart operations.

Speaking to reporters in Mexico City, Francisco Quiroga, the deputy economy minister responsible for mining , said he wanted operations at the country’s largest gold mine to continue.

“Every day that it’s shut, there are millions lost for the company and for public coffers,” Quiroga told reporters.

He did not give more details of the losses to the nation or the company, which is the world’s biggest gold producer. However, he said Peñasquito last year contributed 700 million pesos (USD$37 million) to a social fund paid from a mining tax.

The open-pit mine, in northern Zacatecas state, produced 272,000 ounces of gold in 2018 , company figures show. It accounts for about 17% of Newmont Goldcorp’s net asset value, according to Scotiabank .

Truck drivers have blocked access to the mine since March 27 and the protesters say its operations caused a water supply to dry up. At the end of April the company suspended production, then payments and benefits to villages surrounding the site.

Quiroga said it was not clear whether the water supply dried up as a result of the mine, but the company had to be involved in resolving “legitimate demands” about water.

“The loss of water is paid with water,” Quiroga said, adding that any solution should be transparent and public.

However, the miner said a local trucking company and a group of people from San Juan de Cedros , one of the villages near the mine, demanded the company pay $442 million for the “presumed effects on a body of water in the said community.”

“We want to help solve any water issues in the community but are not willing to give into extortion disguised as a social issue,” said Michael Harvey, director - corporate affairs at Newmont Goldcorp Mexico .

Felipe Pinedo

, one of the protest leaders, accused the government of taking the mining company’s side in the dispute. The protesters wanted their water demands attended to, but they wanted cash too, he told Reuters .

“We want them to pay for the damage caused to the community... This is not only about saying here’s some water and we’re even,” he said, arguing that lack of water had led to loss of livestock.

Mexican community fights the biggest gold producer in the world

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