TSX: G NYSE: GG
VANCOUVER, Dec. 9, 2013 /PRNewswire/ - GOLDCORP INC. (TSX: G, NYSE: GG) today announced that negotiations are continuing between Minera Peñasquito S.A. de C.V. ("Minera Peñasquito") and authorized representatives of the Cerro Gordo Ejido with a view to reaching a mutually beneficial settlement of a land claim.
These negotiations are taking place under the official observation of the office of the Mexican Secretary of the Economy and Goldcorp believes that proper representatives of both parties are currently engaged in a constructive process. Goldcorp has recently received notice from a Canadian law firm purporting to represent the Cerro Gordo Ejido threatening to commence litigation against Goldcorp in Canada concerning these same lands, in an apparent effort to disrupt the ongoing negotiations and legal process from continuing under the auspices of the Mexican judicial system. Goldcorp and Minera Peñasquito have assessed the underlying allegations of the proposed litigation and believe they are baseless and without merit and will vigorously defend any claim if one is filed. Goldcorp believes it is in the best interests of all concerned to continue with the good faith efforts toward a mutually beneficial settlement rather than engage in litigation in Canada that could indefinitely defer any final resolution of this matter.
Goldcorp will continue to employ all legal means at its disposal to ensure continuity of operations and to protect the Company's mineral concession rights consistent with Mexican law. Operations at the Peñasquito mine have not been impacted.In 2005, prior to construction of the Peñasquito mine, an agreement was negotiated with the Cerro Gordo Ejido for the use of 600 hectares (approximately 1,483 acres) of surface land located within the confines of the proposed Peñasquito mine site. The terms of the agreement were based on comparable surface valuations in the region as well as on similar agreements at Peñasquito and other Mexican mining operations. In 2009, the Cerro Gordo Ejido commenced an action against Minera Peñasquito in Mexico's agrarian courts challenging the land use agreement. Following a series of legal proceedings, the agrarian courts ruled on June 18, 2013 that the land use agreement was null and ordered the land to be returned to the Cerro Gordo Ejido for payment of 2.4 million pesos. Three separate claims are currently proceeding in the First District Court of Zacatecas by the Cedros and Mazapil Ejidos and a local transportation union which have resulted in the temporary and permanent suspension of the agrarian court's ruling. Under a permanent suspension, the agrarian court's ruling is suspended pending final determination of the Cedros Ejido's claim following appeal. Peñasquito is the largest gold producer in Mexico and employs approximately 3,000 employees of which approximately 85% are from local communities. The mine generates over 6,000 direct and indirect jobs for Mexican families. Goldcorp is one of the world's fastest growing senior gold producers. Its low-cost gold production is located in safe jurisdictions in the Americas and remains 100% unhedged.