Vancouver — Hecla Mining (HL-N) has temporarily halted mining at Mina Isidora, the smaller of its two gold mines in Venezuela, in response to a group of local residents who are blocking access to the mine site and demanding that Hecla address community issues.
Unemployment is a pressing issue in the El Callao region, where Hecla’s Mina Isidora mine is located. Mina Isidora employs 325 people, making it one of the largest employers in the area. But Mike Callahan, Hecla’s president of Venezuelan operations, said in a news release that the mine continually receives requests to hire more people.
“We obviously cannot meet all the employment demands for the region,” Callahan said. “It is important to recognize that we provide support and employment to more than a dozen communities in the region, and the protestors comprise a very small group from only one region.”
Hecla expects the work stoppage to affect the company’s second-quarter results, which could report a reduction in production by about 12,000 oz. gold. Hecla says the reduction is not expected to affect the company’s gross profit, as it is a large and well-established gold and silver producer with mines in Alaska, Idaho, Mexico, and Venezuela.
During 2006, 100,179 tons of ore was processed at Mina Isidora, for 96,369 oz. gold. The mine has proven and probable reserves of 398,754 tons of ore grading 0.8 oz. gold per ton.
Hecla shares dropped 4% on the news, to US$8.31 from US$8.66.
El Callao is in the eastern Venezuelan state of Bolivar, 193 km southeast of Puerto Ordaz. The region is home to about 25,000 people.
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