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Tahoe flags more layoffs at Escobal amid delays in legal proceedings

Tahoe Resources Inc. said March 8 that it will have to lay off more employees at its suspended Escobal silver-gold-lead mine in Guatemala amid a delay in legal proceedings involving the mine's license.

Production at Escobal has been suspended since June 2017, a circumstance that slashed its silver output to 9.9 million ounces in 2017 from a record 21.3 million ounces in 2016.

In the original case against Escobal, an anti-mining organization approached the country's Supreme Court to look into the granting of licenses by the mining ministry, citing a violation of the indigenous people's rights to be consulted.

In the latest release, Tahoe noted that Guatemala's Constitutional Court, which is reviewing an appeal by the company against the suspension, sought more information concerning Escobal's mining license, including original copies of documents that the company said were submitted in July 2017.

Tahoe noted that some of the information requested "appears to examine areas that were not appealed by any of the parties in the case."

The company said that it had not received a formal request from the court yet and that it would have 15 days to furnish the documents after it receives the notice.

In total, about half of the mine's workforce will have had their contracts terminated as a result of the license suspension, before which Escobal employed 1,030 people.

The court wants "an anthropological study of the surrounding communities" to determine the current populations of indigenous people in San Rafael las Flores and several surrounding communities and a third-party review of the project's environmental impact study and the associated mitigation measures.

The court also seeks an independent review of the mining ministry's consultation process that led to Escobal's initial mining license being granted in 2013.

The CEO said the company was "certainly disappointed with the continued delay in the case and the amount of time it has taken the Constitutional Court to request this information."

"Given that much of the information requested was provided as part of the initial court filings in July 2017, we urge the ministries, agencies, and third parties to comply with the court's 15-day deadline and the court to provide its final ruling quickly thereafter," Tahoe CEO and President Ron Clayton said in the statement.