Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Newmont Corp., the world’s biggest gold miner, is reviewing its investments in Mexico with a workers’ strike at the country’s largest bullion mine now in its third month.
Top executives at the Denver-based firm, including chief executive officer Tom Palmer, traveled to Mexico City this week to meet with senior government officials, imploring them to help resolve what Palmer called a “very, very disappointing” dispute at the Penasquito mine.
“This situation is forcing us to critically review our investments here in Mexico,” Palmer said in a meeting with Penasquito’s operators, posted on the mine’s Facebook page. “While we want to find a way through this, we are not willing to resolve this at any cost.”
The mine shuttered in early June when about 2,000 unionized workers downed tools over a dispute regarding a profit-sharing agreement and alleged contract breaches. The company has since declared force majeure on products from the mine and is seeking a resolution to the dispute in a labor court.
Palmer said he told Labor Minister Marath Bolanos in a meeting that the company is “not willing to negotiate any additional payment” for the workers’ profit-sharing agreement — a sticking point in the negotiations.
Besides gold and silver, Penasquito is also a major supplier of zinc and lead.
(By Jacob Lorinc)
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