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Honduras mines running smoothly, owners say

Mon Jun 29, 2009 1:29pm EDT

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TORONTO, June 29 (Reuters) - Mines in Honduras operated by Yamana Gold (YRI.TO) and Breakwater Resources (BWR.TO) are operating normally despite an unfolding political crisis in the Central American nation, the mines' Canadian owners said on Monday.

Honduran President Manuel Zelaya was ousted in a military coup over the weekend after he said he would seek constitutional changes that would allow presidents to seek re-election beyond a four-year term.

The country's small mining industry, which has few international investors, appeared to be functioning normally.

"No interruptions at all, no impact on operations," said Jodi Peak, vice-president of investor relations at Yamana, which operates the San Andres gold mine in the country's west.

San Andres is expected to produce between 70,000 and 75,000 ounces this year. Yamana agreed earlier this month to sell San Andres and two other mines to developer Aura Minerals (ORA.TO) for about $200 million. The San Andres sale is expected to close next month.

Breakwater, which operates the Mochito zinc, lead and silver mine in the north, also said its operation had been unaffected by the coup.

"All production and shipping schedules are intact," the company said in a statement.

Mochito produced 28,462 tonnes of zinc concentrate, 12,545 tonnes of lead, and 1.9 million ounces of silver last year.

Goldcorp (G.TO) is in the process of remediating the San Martin gold mine, which ended mining operations last year. Spokesman Jeff Wilhoit said any interruptions to the operations were minimal.

Both Yamana and Breakwater are based in Toronto, while Goldcorp is based in Vancouver, British Columbia.

Shares of Yamana were ahead 1 percent at C$10.64 early Monday afternoon in Toronto. Breakwater was flat at 30 Canadian cents, while Goldcorp was up 0.4 percent at C$41.72. (Reporting by Cameron French; editing by Rob Wilson)



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