Here’s what the company says:
Goldcorp suspends operations at Los Filos mine pending renewal of land occupancy agreement
VANCOUVER, April 2, 2014 /CNW/ – GOLDCORP INC. (TSX: G) (NYSE: GG) announced that its Los Filos mine in Guerrero State, Mexico has suspended operations following unsuccessful efforts with the Carrizalillo Ejido to reach a negotiated settlement to renew the occupancy agreement that expired on March 31, 2014. Certain activities related to environmental safeguards and site security will continue during the suspension.The Company continues to hold discussions with Ejido representatives to expeditiously resolve the situation with the goal of ensuring the long-term sustainability of operations amid a lower gold price environment and significantly higher Mexican tax obligations. The Los Filos mine directly employs more than 2,600 people from the surrounding communities with an estimated 10,000 additional jobs created as a result of the mine’s presence in the region.
Since 2007, the 176 Ejidatarios (members of the “Ejido” landowner group) receive 2.5 ounces of gold for every hectare of the 1,200 hectares of land that Goldcorp rents, athough the rent was agreed two years after the start of formal operations.
On Sunday March 30th, an assembly of the Ejido Commission was called to discuss renegotiation terms for the contract with the Canadian company, at which the corporate representative Francisco Ballesteros Corrales was present.
Although the vote was not unanimous, the assembly authorized representatives to seek an improved deal with an initial offer of 6 ounces.
On Monday morning the offer was lowered to 4.5oz with the intention to reach an deal, however the proposal was rejected by company executives. Due to this, from 6am today the inhabitants of Carrizalillo decided to block access to the large scale mine.
And for those of you versed in the tongue of Cervantes, this report provides lots of background as to why the locals want more from the company: Broken promises, dry wells, contaminated water supplies and things such as…
He (the Ejido committee member) admits there’s a feeling of regret among the Ejido members for allowing the mine operation to happen, however they assume that it’s too late to demand the closure of the mine.”