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Tahoe cuts 25% of workforce at Escobal

Canada-based Tahoe Resources (CN:THO) has cut 25% of the workforce at its Escobal mine in Guatemala as the operation remains in limbo.
Tahoe cuts 25% of workforce at Escobal Tahoe cuts 25% of workforce at Escobal Tahoe cuts 25% of workforce at Escobal Tahoe cuts 25% of workforce at Escobal Tahoe cuts 25% of workforce at Escobal

Underground miners at Escobal

Staff reporter

It cut 250 employees from the 1,030-member workforce, citing a delay in an expected court decision over its mining licence, and the "inability" to resume operations, referring to a long-running and at times violent blockade of the mine.

The mining licence had been reinstated by the Supreme Court in September but the decision was appealed in the Constitutional Court on October 25, and Tahoe said despite Guatemalan law stating the court must rule within five calendar days of the hearing, it was yet to do so.

"We are very disappointed to reduce our workforce at this time, but this is a natural consequence to the prolonged inaction in the legal system," president and CEO Ron Clayton said.

"We are hopeful that the Constitutional Court will honour their own legal procedures and precedents and urge them to provide a fair and transparent ruling quickly that demonstrates Guatemala remains open for responsible foreign investment."

Tahoe said for every month Escobal was delayed, about US$4 million in taxes and royalties was not being paid to the government and local communities.

Tahoe shares, which virtually halved in value since trading above C$10 prior to the licence suspension six months ago, rose 1.3% to $6.23.

The company had US$182.1 million in cash and equivalents, and little debt, at the end of September.

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