Torex Gold reports fatalities at Mexican underground mine, shares plunge

Torex Gold Resources (TSX: TXG) says a fatal carbon monoxide gas leak at its El Limón Guajes (ELG) underground mine in Guerrero, Mexico, has claimed the lives of three workers.

The incident, according to the Canadian miner, occurred during the December 5 day shift at ELG underground, part of a larger mine complex that also hosts two open pits and a 13,000-tonne-a-day processing plant.

As a result of the incident, activities at the ELG underground mine have been suspended, Torex said, adding that an investigation to determine the cause of the accident will begin shortly.

With this setback, Torex saw its shares plunge on Friday, down 14.7% to C$27.21 apiece by 11:20 a.m. in Toronto. The company’s market capitalization is approximately C$2.3 billion ($1.6bn).

“While the details are very limited at this time, we do know that a 32-year old male, a 36-year old male and a 39-year old male have lost their lives to carbon monoxide exposure,” Torex CEO Jody Kuzenko said in a news release.

Two of the workers mentioned were Torex employees, while the third was a contractor. A fourth contract employee was hospitalized but is expected to recover, the company said.

Mexico investigation

Mexican President Claudia Sheinbaum said on Friday that authorities are also reviewing the case, adding that she had asked for an increased inspection of mines.

“Because it can’t be that some standards are applied by Canadian companies here in Mexico and others (by Canadian companies) in Canada,” Sheinbaum told Reuters.

In addition to ELG, Torex is set to have another underground mine within Mexico’s Guerrero gold belt, as the nearby Media Luna project is close to completion. This new mine is being tied into the ELG complex, and together, they were expected to deliver 450,000 to 470,000 oz. of gold production this year.