Newmont Goldcorp offer $25 million in social projects to end mine conflict at Penasquito
Newmont Goldcorp said that it had offered $25 million in community investments and land rental fees to resolve a conflict at its Penasquito gold mine in Mexico, but activists said they are unsatisfied.
The mine was part of the portfolio of Goldcorp which was acquired by Newmont in April to form the world’s biggest gold producer. Reuters reported that operations at the openpit mine located in northern Zacatecas state have been suspended by protestors who have formed a blockade.
“We have made a very generous offer of social investment, but the blockade leaders are demanding hundreds of millions of dollars in cash for themselves,” said Michael Harvey, director of external relations for Newmont Goldcorp Mexico.
Felipe Pinedo, a local leader who has helped organize blockades of the mine in the past, denied Harvey’s allegation in a phone interview with Reuters.
“The problem isn’t an issue of money; it’s an issue of life,” said Pinedo. “The people here are clear: They will accept the projects but give us back our water.”
He argued that the company’s spending in the surrounding Cedros community was a fraction of the profits from the mine that leave Mexico. The mine produced 272,000 ounces of gold last year.
The Newmont Goldcorp proposal put forward at negotiations with the community include a 30-year pledge to operate a water treatment plant, a 12-year deal to lease local land and the promise to invest in a production or infrastructure project, the company said in a statement.
The mine directly employs more than 6,500 people, including 315 local residents, the company added.
Penasquito accounts for about 17 percent of Newmont Goldcorp’s net asset value, according to a Scotiabank estimate from earlier this year.
Operations at the mine have been intermittent since March due to protests. Some protest leaders said they wanted payment to compensate for damage to the local water supply.