(Recasts with reasons for shutdown, fresh analyst comment,
updates stock price)
By Nicole Mordant
VANCOUVER Oct 3 Goldcorp Inc said on
Monday it was temporarily shutting down its Peñasquito gold mine
in Mexico as it was unable to safely continue operations due to
a week-long blockade by a trucking contractor, sending its
shares down nearly 5 percent.
The world's No. 3 gold miner by market value said it was
unable to bring in food, water and fuel for the 750 people on
the site, which has been blockaded by a contractor concerned
about losing business due to efficiency improvements at the
A contingency plan was in place that would allow mining and
processing to be restarted immediately once the dispute was
resolved, Vancouver-based Goldcorp said. It did not expect the
shutdown to impact 2016 production or cost estimates.
A restart of the mine earlier this year after Goldcorp
performed its first site-wide shutdown, proved to be "somewhat
challenging", Desjardins analyst Michael Parkin said in a note
"We thus view this as a potential risk" for Goldcorp's
fourth quarter results, Parkin said.
Goldcorp expects the Peñasquito mine in northern Mexico to
produce between 520,000 and 580,000 ounces of gold this year,
equal to around 19 percent of the company's total forecast
output of 2.8 million to 3.1 million ounces.
The blockade is the latest setback for Goldcorp, which has
experienced a number of operating problems at its mines in the
past year, causing its stock to trail peers.
Goldcorp said it had taken legal steps, including filing
criminal charges against the protesters but that it also was
ready to talk with the contractor's representatives.
Protest leaders "have refused numerous efforts to meet with
Goldcorp representatives and government officials to resolve the
dispute", Goldcorp spokeswoman Christine Marks said in an email.
One of the protest leaders, Felipe Pinedo said last week,
protestors wanted to speak to senior Goldcorp officials, not
those at the mine.
He said landowners were also part of the blockade, which
began on Sept. 26. Protesters' demands include payment for
environmental damages, jobs, and water for their communities.
In late August, Reuters reported on a long-running leak of
contaminated water, which had not been disclosed to the public,
at the mine, Mexico's biggest gold deposit.
Goldcorp's shares were down 4.9 percent at C$20.60 on the
Toronto Stock Exchange. That was more than the 3 percent fall in
the S&P/TSX Global Gold index, which was hit by a
weaker gold price.
(Additional reporting by Arathy S Nair in Bengaluru and Noe
Torres in Mexico City; Editing by Don Sebastian and Marguerita