Tahoe Resources announced a further reduction to Minera San Rafael’s workforce at its Escobal mine in Guatemala. Given the ongoing delay in the Guatemalan Constitutional Court’s ruling, the lack of transparency into the status of the legal process, and the inability of the company to resume mining operations, it has terminated approximately 200 additional Minera San Rafael employees. About 70% of the total workforce has now been dismissed. Prior to the license suspension, Minera San Rafael employed 1,030 people, 97% of whom are Guatemalan and 50% of whom are from the Santa Rosa region.
“Despite extensive efforts, we have been unsuccessful in reaching a favorable resolution that would avoid negative impacts for all stakeholders, especially for our workforce and the local economy,” said Jim Voorhees, president and CEO of Tahoe. “We are extremely disappointed with the need for a further workforce reduction at this time, however, this is a natural consequence to the prolonged inaction in the legal system. With that said, we remain committed to seeking a resolution and restarting the Escobal mine at the earliest possible time.”
The Guatemalan Constitutional Court heard the appeals of the Supreme Court’s decision to reinstate the Escobal mining license on October 25, 2017. According to Guatemalan law, the Constitutional Court must rule within five days of the public hearing. At this time, however, the Constitutional Court has yet to rule and the company cannot at this time predict when it will issue its ruling.
Tahoe continues to believe that legal precedent in Guatemala supports the reinstatement of the Escobal mining license and the resumption of operations, at which time Tahoe will seek to restore its workforce. Since the license suspension in July 2017, more than $50 million in taxes and royalties that might otherwise have been earned during this period have not been paid to the government of Guatemala and the local communities.