Tahoe denies Guatemala proposed mine act changes

Reuters News
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Posted: Jun 28, 2012 11:28 AM

(Reuters) - Shares of Tahoe Resources Inc tumbled on Thursday even as it denied media reports that Guatemala was considering legislation that would allow it to take up to 40 percent of companies exploiting natural resources there.

"We have not been contacted by the Guatemalan government regarding this," said Ira Gostin, Tahoe's vice president of investor relations. "There hasn't been anything actually passed in the Guatemalan law or anything proposed."

Shares of the silver miner had been halted Thursday morning on the Toronto and New York stock exchanges.

By 11 a.m. (1500 GMT), the company's Toronto-listed shares were down 39.7 percent at C$9.75, while its New York-listed shares fell 23.7 percent to $12.05.

A report on Mineweb.com said Guatemala, where Tahoe is developing the Escobal silver mine, had proposed changes to its mine act to acquire up to 40 percent of mining companies with operations in the Central American country. The original source of the report was a local newspaper.

Representatives of the Guatemalan government could not be reached immediately for comment.

(Reporting by Julie Gordon; Editing by Frank McGurty)