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11/19/09

New Gold (NGD) suspends operations in Mexico

Goodbye. Oh monsieur Lassonde, you didn't do your DD, did you? Tut tut tut.......

Here's the Press Release, and here's how it starts:

VANCOUVER, Nov. 19 /PRNewswire-FirstCall/ - New Gold Inc. ("New Gold") (TSX and NYSE AMEX-NGD) is cooperating with Mexican government authorities and pursuing all legal appeals after the company was notified yesterday that it must suspend mining operations at its Cerro San Pedro Mine, known regionally as Minera San Xavier ("MSX"). Although mining has been suspended, gold recovery operations of existing inventory on the leach pads are continuing.

Following a ruling by the Federal Court of Fiscal and Administrative Justice, SEMARNAT, the Mexican government's environmental protection agency nullified the mine's Environmental Impact Statement ("EIS") which was issued in 2006. PROFEPA, the Mexican environmental enforcement agency, issued the order requiring MSX to suspend mining as a consequence of the nullification of the EIS.

MSX has appealed the decision of the Federal Court of Fiscal and Administrative Justice and intends to pursue all legal avenues with respect to the recent actions of both SEMARNAT and PROFEPA. New Gold is seeking immediate remedies. MSX has also filed a new EIS with SEMARNAT.

"This is a continuation of a decade of challenges from a group of individuals largely from outside the area who are opposed to the mining operations at Cerro San Pedro. We are taking all possible steps to respond to challenges to our legal ability to operate the mine, and believe that we will resume full operations" says yada yada continues here


Good to see that Mexico has finally grown a pair....that's the only bit that surprised me, but as I wrote in IKN29 last weekend...
The IKN Weekly does not have the same agenda as the IKN blog and does not try and pass judgement on these things. It is up to the individual investor to decide whether NGD suits his or her portfolio, but in this case I’ll venture to say that I would not be a shareholder in New Gold for the forseeable future. That’s just me. Enough said.