El-Estor-Guatemala

The Events of September 27, 2009, El Estor, Guatemala

Hudbay Minerals, through its subsidiary Compania Guatemalteca de Niquel (CGN), is committed to advancing the Fenix nickel project, located near El Estor, Guatemala. CGN currently employs approximately 200 people, both directly and indirectly, in Guatemala, and is actively involved with the local community and all levels of government to ensure the project delivers enduring benefits to the people of Guatemala, as well as benefits for all stakeholders.

Occupation of CGN Lands

In 2007, a group of illegal squatters began occupying an area of the project lands owned by CGN known as Area 217.

In April 2009, an agreement was reached to facilitate the voluntary return of illegal occupants to their homes in the nearby village of Las Nubes. The agreement was negotiated with input and support from various agencies and levels of government, and included commitments by CGN to implement various improvements for the neighbouring community including:

  • Construction of a school house
  • Establishment of a water delivery system and a new water tank
  • Building of new house pads and the supply of building materials
  • Improved road access

CGN also agreed to pay wages to local residents for their contributions to these various projects. All of the projects were completed in May 2009.

Ongoing Occupation by a Small Group

While the majority of the illegal occupants honoured the freely negotiated agreement and returned to their homes, a small number continued to occupy CGN property at this location illegally and counter to the negotiated agreement. On Sunday, September 27, 2009, a meeting was held between the regional governor and local residents of Las Nubes to persuade the remaining illegal occupants to comply with the agreement and return to their homes in the village. No evictions were carried out and none were threatened or intended. These discussions were consistent with Hudbay's strategy of peacefully resolving illegal occupations through dialogue.

Organized Assault on Motorcade and Facilities

When negotiations ended without resolution, vehicles departing from Area 217, including the governor’s motorcade, were attacked near the town of El Estor by a separate group of organized protestors. That attack appears to have been the catalyst for various confrontations that followed that day, including an attack directed at the gate of CGN’s private road to the mine site and an attack on newly-constructed homes on CGN property. In both instances, CGN security personnel under fire were instructed to evacuate the areas as quickly as possible without engaging their attackers.

The police reports received by CGN indicate that the protestors also ransacked the local police station and stole a cache of weapons, including automatic firearms. Later in the day, the protestors attacked a CGN-sponsored community hospital in El Estor, resulting in extensive damage to the facility and equipment recently donated by the Hope Alliance. There was no damage reported at the mine site or plant facilities owned by CGN.

CGN Security Personnel Acted with Restraint

Throughout the attacks, CGN personnel showed restraint and acted only in self defence. Their measured response to the various attacks helped to prevent the further escalation of violence, thus limiting the number of injuries on both sides of the conflict. CGN has confirmed that five of its security personnel were injured during the violence, one requiring emergency transport to Guatemala City for medical treatment. Unfortunately, a protestor (Adolfo Ich Chaman) died as a result of wounds sustained that day. Based on internal investigations and eye witness reports, HudBay and CGN are confident that CGN personnel were not involved in his death.

These events are being actively investigated by Guatemalan authorities, with whom CGN is fully cooperating to ensure all the facts are uncovered and the parties responsible for Mr. Ich Chaman’s death are apprehended.

Hudbay Working with El Estor Community to Ensure Safety and Negotiated Resolution

Hudbay Minerals and CGN are saddened by the injuries and loss of life that occurred in the El Estor area and are primarily concerned with ensuring the safety and security of all local residents and employees. CGN will continue working collaboratively with the local community through various outreach programs to support the development and enhancement of health, education and cultural centers and to increase environmental understanding in the region.

The majority of residents in the area support CGN outreach efforts, investments in the local community and the ultimate development of the Fenix project. A petition delivered to government authorities was recently signed by more than 3,000 individuals and 86 businesses from the community that condemns protestor attacks and requests that the Guatemalan government intervene to prevent violence of this kind.

Hudbay Minerals and CGN remain committed to working with local residents to negotiate a fair and equitable solution to resettlement of those illegally occupying CGN lands.

Media Inquiries

Scott Brubacher
Director, Corporate Communications
416-814-4373
scott.brubacher@hudbayminerals.com

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