Truckers block access to Goldcorp’s Peñasquito, could flag Q4 restart risk

VANCOUVER (miningweekly.com) – TSX- and NYSE-listed gold major Goldcorp has implemented an orderly shutdown of its flagship Peñasquito mine, in Mexico, saying Monday that a trucking contractor had been illegally blocking entry to the site since last Wednesday.

The protest has its roots in Goldcorp's efforts to diversify its local transportation supply chain and distribute economic benefits to more local suppliers, the Vancouver-based company said in a release.

Despite the company being forced to implement a controlled shutdown of activities at the operation, which employs about 10 000, Goldcorp stated its commitment to respectful negotiations with the trucking contractor's representatives.

The company noted that, while the incident was unlikely to have an adverse impact on the 2016 output and cost guidance, it had activated a comprehensive contingency plan that would enable mining and processing to restart as soon as matters were settled.

Goldcorp, which has also been working to realise cost efficiencies at the mine, has taken “all necessary legal steps”, including filing criminal charges against the protest leaders. It expects legal enforcement to “ensure a swift and orderly end” to the illegal blockade.

Having last year produced 860 300 oz of gold makes Peñasquito a significant contributor to Goldcorp’s revenue stream. However, an earlier site shutdown this year, which proved somewhat challenging to get going again, could flag the current shutdown as a potential risk factor, Desjardin Capital Markets analyst Michael Parkin said in a note to clients.