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VANCOUVER, British Columbia - September 10, 2017 - Tahoe Resources Inc. (TSX: THO, NYSE: TAHO) ("Tahoe" or the "Company") reported today that the Guatemalan Supreme Court issued a decision that reinstates the Escobal mining license of Tahoe's Guatemalan subsidiary, Minera San Rafael ("MSR"). This decision reverses the Supreme Court's preliminary decision to suspend MSR's license in connection with an action brought by the anti-mining organization, CALAS, against Guatemala's Ministry of Energy and Mines ("MEM"). CALAS alleges that MEM violated the Xinca indigenous people's right of consultation in advance of granting the Escobal mining license to MSR.
As part of its decision, the Supreme Court ordered MEM to conduct a consultation under ILO Convention 169. Per the ruling, MEM has been ordered to consult with the Xinca indigenous communities within a certain geographic area and report results of the consultation to the satisfaction of the Court within 12 months. Tahoe is seeking clarification from the Supreme Court on the specific geographical departments to be included within the scope of MEM's consultation. Although Tahoe believes that MEM complied with ILO Convention 169 before it issued the Escobal license, it will fully support MEM in any of its future indigenous engagement and will encourage MEM to involve independent ILO 169 experts to assist in this process.
The Company expects that CALAS, the Xinca Parliament and other interested parties may appeal the Supreme Court's ruling to the Constitutional Court. The following parties have standing and the ability to appeal the ruling: MSR, MSR's employees and vendors, the Xinca Parliament, CALAS, and judicially designated municipalities. After the Supreme Court rules on MSR's motion for clarification, MSR will have a right to appeal the matter to the Constitutional Court if it deems necessary. The Constitutional Court is expected to rule on all appeals by the end of the year.
While the Supreme Court ruling allows Escobal operations to commence immediately, the illegal roadblock at Casillas is ongoing, preventing an immediate restart of operations at this time. The Company continues to work with the government, community leaders and international mediation experts to resolve the roadblock situation peacefully and expeditiously. Upon a resolution of the blockade, the Company expects to resume production at Escobal within a week.
Ron Clayton, Tahoe Resources President and Chief Executive Officer, commented: "We are pleased that the Supreme Court of Guatemala has abided by legal precedent and restored MSR's license to operate the Escobal mine. The Company respects the rights of indigenous people in all jurisdictions in which we operate and are always willing to engage with any community members in those jurisdictions. We remain focused on peacefully resolving the blockade at Casillas. While we support the rights of all peoples to peacefully protest, we do not support the illegal blockage of public highway by non-locals which has had a devastating economic impact on our employees, contractors and communities. Once the road is re-opened at Casillas, we will resume full operations without disruption and put our valued employees and vendors back to work, support the economy of our local communities and return value to our shareholders."
As reported previously, until operations begin, the Company is only able to access $75 million of the $300 million capacity of its revolving credit facility entered on July 18, 2017, and may continue to be subject to events of default. Upon resumption of operations, the Company expects to provide an update on Escobal production that has been deferred to future periods. The Company expects to update previously suspended guidance for the gold operations, including exploration, later in the month.
About Tahoe Resources Inc.
Tahoe's strategy is to responsibly operate mines to world standards and to develop high quality precious metals assets in the Americas. Tahoe is a member of the S&P/TSX Composite and TSX Global Mining indices and the Russell 3000 on the NYSE. The Company is listed on the TSX as THO and on the NYSE as TAHO.