Gold mining company Tahoe Resources Inc. is denying reports that heavy rains led to a spill at its Peru gold mine, causing water contamination nearby.
One of those reports published on Thursday on local news site Cajabamba Peru, claimed that a leaching pit had overflowed at Tahoe's Shahuindo mine site, flooding a nearby village with toxic materials.
Leaching is an industrial process that uses chemicals such as sodium cyanide to extract metals from ore and is commonly used at open-pit mines worldwide.
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In a press release on Friday, Nevada-based Tahoe said the Peruvian environmental regulator visited the site to investigate "an unfounded complaint" that the leach pond was compromised, and has taken samples to check for contamination.
Tahoe added that the Agency for Environmental Assessment and Control (OEFA) told the company the leach pool "did not overflow and was not compromised in any way."
However, the company said that, due to recent heavy rains, a diversion ditch designed to keep rainwater out of a section of its Shahuindo mine complex had overflowed.
"At no time has the rainwater had any contact with process water or any contamination from industrial activities," the company said.
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The region where the company operates in central Peru has been experienced flooding and mudslides lately, Tahoe said.
The company started commercial production at Shahuindo in May, 2016. The mine produced 79,000 ounces of gold last year.
Shares in Tahoe fell by 3.2 per cent on the Toronto Stock Exchange on Friday, to close at $5.56 apiece.
The company's stock has been under serious pressure for the past six months, losing about half of its value. In July, Tahoe was forced to suspend production at its flagship Escobal silver mine in Guatemala. The Supreme Court of Guatemala suspended its mine licence after allegations that local Indigenous populations were not adequately consulted before Tahoe was granted the licence. Earlier this week, the company announced it was cutting 250 jobs at the Escobal mine as a cost-saving measure.