Tahoe Resources (TSX, NYSE:THO) is denying a media report issued on Thursday that its Shahuindo mine in Peru has contaminated local water supplies.
The story (in Spanish) by Cajabamba Peru, stated that heavy rains caused a leaching pit to overflow and flooded a nearby village.
"The heavy rains that have occurred that in the early hours of today, one of the waste pits of this company overflowed and flooded the village of Liclipampa Bajo, in the province of Cajabamba, leaving crops and houses flooded with highly toxic materials," states the article, translated from Spanish.
"The population is worried because in this pond there would be highly dangerous waste, which would put at risk the lives of the affected inhabitants."
However according a release by Tahoe issued the next day, a ditch designed to keep rainwater out of the mining area overflowed, but it was upstream of the permitted discharge point.
"At no time has the rainwater had any contact with process water or any contamination from industrial activities," the Vancouver-based gold producer stated.
It added that the Agency for Environmental Assessment and Control (OEFA) visited the mine to take water and sediment samples, and found that the leach pond did not overflow.
The Shahuindo mine is an open-pit heap leach gold mine that started commercial production in 2016.
It expects to ramp up to full production of 36,000 tonnes per day in the second half of this year.
The mine has proven and probable reserves of 110.3 million tonnes, containing 1.9 million gold ounces, with an average grade of 0.52 grams per tonne.