Brazilian authorities shut down Jaguar mine after tailings slide

Labour officials in Brazil’s Minas Gerais state have order a suspension of Jaguar Mining’s (TSX: JAG) Turmalina gold mine due to safety risks stemming from a recent tailings pile collapse.

The mine — part of Jaguar’s MTL mining complex located 130 km northwest of Belo Horizonte — was deemed an “unfeasible work environment” following inspections conducted by labor auditors.

The suspension comes after a partial rupture in the tailings pile on Dec. 7 that displaced 255 residents and affected multiple structures in the surrounding area.

There’s still significant risk of further collapses within the tailings structure, prompting immediate action to safeguard workers and nearby communities, Brazil’s Ministry of Labour said.

News of the suspension caused Jaguar Mining’s stock to fall 3.6% on Tuesday morning, sending its market capitalization to C$191.9 million ($134 million).

Stabilization efforts

Jaguar Mining said that no workers have been present at the site since the incident, in compliance with a prior directive from the National Mining Agency (ANM).

The Toronto-based miner told the newspaper Estado de Minas that stabilization efforts are ongoing, adding that the work is “being carried out with the best practices to ensure the health and safety of its workers.”

In 2022, the Turmalina underground mine produced 33,117 oz. of gold, accounting for nearly half of the company’s total output. The broader MTL complex includes a 2,000-tonne-per-day processing plant and three satellite deposits — Faina, Pontal, and Zona Basal — alongside the Onças de Pitangui project.