PRECIOUS METALS

Surprise blockade disrupts McEwen's El Gallo

Negotiations underway

Staff reporter
 McEwen Mining’s El Gallo project in Mexico

McEwen Mining’s El Gallo project in Mexico

The company said on Monday there was an illegal blockade of El Gallo's main access by members of nearby communities, with certain individuals believing annual payments and community infrastructure improvements should increase significantly.

"El Gallo has operated harmoniously with the local communities since mining started in 2012, having demonstrated a long-standing track record of supporting local communities," McEwen said.

"In this context, the current situation is surprising."

McEwen said the site remained minimally staffed to maintain appropriate safety, security and environmental systems.

El Gallo is one of the company's four gold producing assets in the Americas and the residual heap leaching operation was expected to contribute 3-4% of the company's gold-equivalent production in 2021.

McEwen is planning to breathe new life into the complex through the proposed Fenix redevelopment, outlining more modest plans for a 9.5-year mine in a January feasibility study.

McEwen shares (NYSE: MUX), which were trading about US58c a year ago and had spiked to $1.60 in February on ambitious growth plans, closed yesterday at $1.13 to value it about $519 million.

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