April 13, 2010 / 7:42 PM / 7 years ago

UPDATE 1-Pan American says strike shuts Peru silver mine

* Says strike halts production at Huaron mine

* Could hit Huaron’s production forecast

TORONTO, April 13 (Reuters) - Pan American Silver Corp PAA.TO said on Tuesday that that workers at its Huaron silver mine in Peru had gone on strike and production at the mine had been shut down.

Pan American said the walkout began on April 10 and was due to a dispute over workers’ profit-sharing payments for 2009.

The company contends that Huaron’s profits in 2009, and the workers’ share, were hurt by the economic downturn in the first half of last year.

The company also warned that profit-sharing concerns and related work stoppages were not isolated to the Huaron mine and had arisen at a number of other operations in Peru in recent weeks.

Pan American also operates an underground mine at Morococha in Peru. It also owns the Quiruvilca mine, where operations were suspended in 2009, as the mine had become increasingly reliant on base metal production.

The company stressed that Huaron is the only operation affected by the strike and it is continuing its efforts to resolve the dispute with the union.

Depending on its duration, the strike could have a negative impact on the annual production forecast for Huaron, the company said in a statement. (Reporting by Euan Rocha; editing by Rob Wilson)

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