El Salvador lawmakers overturn mining ban Bukele called absurd
El Salvador became the first country in the world to ban all forms of metals mining in 2017.
Equinox Gold (TSX: EQX, NYSE: EQX) has suspended operations at its RDM mine in Brazil for at least two months as scheduled permits needed to raise its tailing dam were delayed, the company said on May 16.
“Equinox Gold has temporarily suspended RDM operations until this matter can be resolved,” the company said in a press release. “Discussions with regulatory authorities are ongoing and the TSF (Tailings Storage Facility) raise contractor is ready to mobilize and commence work.”
Equinox has been applying for permits to raise its TSF every year since 2018 after it altered the design of its facility and changed it from a centreline to a downstream design. It last received a permit in 2021, which allowed it to raise the facility to its current level, but the miner is yet to receive permission for the next TSF raise
The RDM TSF is raised on an intermittent basis throughout the life of the mine to store additional tailings produced from ongoing operations, the Equinox said.
Located in Minas Gerais state of southeastern Brazil, the mine began production in early 2014 as an open pit operation. It was estimated it could produce 70,000 to 80,000 oz. gold in 2022 or about 11% of the company’s consolidated production.
As a result of the suspension, the company has withdrawn its 2022 production guidance for the mine.
“Equinox Gold expects that full operations could restart as soon as two months from the receipt of regulatory approval, which is anticipated during Q2 2022,” it said.
During the first quarter of 2022, RDM produced 7,160 oz. gold, which was lower than the 13,362 oz. gold produced in the previous quarter. Equinox said production was lower in that quarter because the company had suspended operations for just over two weeks to reduce water levels in the TSF to comply with the regulatory requirements.
Equinox had also pumped water from the TSF into the open pit, to comply with the requirements, which meant higher-grade ore sources in the bottom of the pit were not available for mining.
“Consequently, RDM was reliant on processing lower-grade stockpile material for 80% of the ore processed during the quarter,” said Equinox in a security filing on May 3, in which the company had first disclosed the possibility of temporarily suspending the mine.
A day after the disclosure on May 3, Equinox Gold’s share value fell from C$9.19 per to C$7.87 on the TSX exchange.
