TORONTO, April 4 (Reuters) - Pan American Silver PAA.TO said unionized workers had begun a strike at its Morococha mine in Peru, but it was using contract workers at the mine and still expected to meet full-year production targets.
In a Friday evening statement, the Vancouver, British Columbia-based company said it had discovered a crack in the shell of its primary rod mill as it took advantage of down time caused by the strike to bring the mill down for scheduled maintenance.
“The repairs to the rod mill will require a short-term stoppage that may interrupt production, but such stoppage may coincide with some down time, if any, that might otherwise have resulted from the strike,” it said.
“Pan American believes the impact of any potential production disruptions at Morococha will not materially change the Company-wide annual production forecast of 21.5 million ounces of silver.”
The company, which operates eight mines in Mexico, Peru, Bolivia, and Argentina, also targets 2009 gold production of 85,000 ounces. It said it was in talks with workers and Peru’s ministry of labor to reach a new collective agreement at the Morococha mine. (Reporting by Janet Guttsman, editing by Vicki Allen)