El Salvador forms commission to test contamination from Goldcorp's Cerro Blanco

The president of El Salvador has formed a commission to analyze any impact of Vancouver-based Goldcorp's (TSX: G, NYSE: GG) Cerro Blanco gold-silver project on the country's water resources. The commission will examine if the project, in neighboring Guatemala, has contaminated El Salvador's Lago de Güija lake and Lempa river, President Mauricio Funes said. While a preliminary report did not find signs of contamination, the commission will conduct further tests and analyze possible measures needed to guarantee pollution levels do not increase, a statement said on the government website said. If the project is found to be contaminating water, Funes said, the government will begin legal and diplomatic actions to address the problem, warning that the lake and river are important sources of drinking water for the country. According to information on the Goldcorp website, Guatemalan authorities have approved groundwater discharge at Cerro Blanco, with water now pumped directly from underground and processed in a water treatment plant, "which removes naturally-occurring groundwater constituents prior to discharging." No one from Goldcorp was immediately available to comment. Last month, El Salvador's human rights defense attorney general (PDDH) asked the Inter-American Commission on Human Rights (CIDH) to intervene to prevent potential contaminationfrom Cerro Blanco, which is close to the country's border. At the end of 2011, Cerro Blanco registered indicated resources of 2.52Mt grading 15.6g/t gold and 72g/t silver, or 1.27Moz contained gold and 5.8Moz contained silver. Inferred resources were 1.35Mt grading 15.3g/t gold and 59.6g/t silver, or 0.67Moz gold and 2.60Moz silver. Goldcorp is among the world's biggest yellow metal producers, with 2012 guidance set at 2.35M-2.45Moz. The company has producing assets in Canada, the US, Mexico, Guatemala, Honduras, Dominican Republic and Argentina.