Guatemalan Court Stops U.S. Company From Working On Silver Mine, Citing Indigenous People…Who Don’t Live There

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Posted: Aug 08, 2017 8:00 AM
Guatemalan Court Stops U.S. Company From Working On Silver Mine, Citing Indigenous People…Who Don’t Live There

Well, this is certainly odd. A mining company that was operating a silver mine in Guatemala was shut down by the nation’s supreme court for not consulting with the indigenous peoples in the area. That seems standard. Even in the U.S., the Keystone Pipeline had to go through consultations with local Native American tribes to ensure that their sacred burial sites would not be disturbed. They protested anyway, but that’s a story for another time.

The halt in production torpedoed the stock of the mining company—Tahoe Resources—and threatens the jobs of  the thousands of workers who ventured to Guatemala to start mining for silver. The kicker is that there is no proof that indigenous peoples actually live in the area (via Daily Caller):

A Nevada-based mining company has been struggling to regain its footing after the Guatemalan Supreme Court suspended its license to operate one of the world’s largest silver mines over the company’s failure to consult indigenous peoples allegedly living in the area.

Tahoe Resources faces a fundamental problem, though — the Guatemalan government’s latest census shows no indigenous people living in the San Rafael community where the mine is located.

The mining company says it did consult with the few indigenous Xinca who do live in the region, but that wasn’t considered by the country’s high court. In July, justices ruled in favor of environmental activists suing the Guatemalan government to halt operations at the Escobal mine.

Tahoe Resource’s stock price fell about 40 percent after the July 5 ruling, according to Bloomberg, and the company said a three-month suspension of their operating license could cost Guatemala $9 million in royalty payments and tax revenue. Tahoe will also defer spending $12 million to ramp up mining operations.

“We are extremely disappointed in the Court’s ruling suspending the license because we believe that there are no indigenous communities affected by Escobal’s operations,” Tahoe CEO Ron Clayton said in a statement on the court ruling.

Should the suspension go on long enough to threaten the viability of the Escobal silver mine, the livelihoods of the 7,600 workers and their families tied to the mine’s operations would be at risk. A handful of Guatemalan-born Tahoe employees actually migrated back to their home country from the U.S. to work at Escobal.

Editor's Note: The mine was operational when it was shut down. The post has been updated to reflect the changes.