Peruvian government issues emergency decree near Gold Hawk plant

By The Canadian Press

VANCOUVER - Gold Hawk Resources Inc. (TSXV: CGK.V) said Friday the Peruvian government has issued an emergency decree for a hillside near its Coricancha processing plant and tailings area and called for the relocation of the facilities.

"We believe this decree will expedite the required authorizations to implement measures that will minimize the risks to people, the environment and property," said Gold Hawk president and chief executive Kevin Drover.

The company said it was reviewing the decree and was preparing a certified English translation.

Crushing and milling operations have been suspended since early May because of ground displacement in and around the tailings handling area of the gold, silver, zinc and lead open-pit operation 90 kilometres east of Lima.

The current tailings area had been scheduled to close around midyear and be replaced by a new nearby facility for containing mine waste.

But Gold Hawk, which acquired the mine in March 2006 and after refurbishment began commercial production last October, said last month that it "will no longer seek final approval for use of the southern extension tailings area."

Instead, the Vancouver-headquartered company will "seek a long-term tailings handling solution using an accelerated approach" at the Chinchan site, currently in the engineering stage.

The company has blamed the shifting at the tailings site on an unusually heavy rainy season, leakage from a hydro utility's water channel and an irrigation system, a high level of regional seismic activity, and "the tailings impoundment and the geotechnical features of the area around and near the tailings impoundment."