New Gold (AMEX:NGD) Shares Plunge as Mexican Court Denies Appeal

New Gold (AMEX:NGD) (TSE:NGD) said today it has had its appeal concerning the revocation of its environmental permit at its Cerro San Pedro mine, denied by a Mexican court.

This evidently reverses an injunction they won in December against the original ruling which force operations at the mine to be suspended, but which freed them to continue production to this point in 2010.

For New Gold this is a big deal, as the Cerro San Pedro mine accounts for 30 percent of the overall annual gold production of the company, and if it is forced to stop production again, it will make a huge impact on their bottom line.

It isn't clear if a complete shutdown is in the works, as the full decision hasn't been received by New Gold as of this writing.

In New York and Toronto New Gold was down over 10.00 percent, as of 12:57 PM EDT.

New Gold's (TSE:NGD) Cerro San Pedro Mine Resumes Operations

New Gold's Cerro San Pedro Mine Open for Full Operations

New Gold's (TSE:NGD) announced operations at its Cerro San Pedro mine in Mexico have resumed after it had been partially closed down while waiting for a court to make a decision on the use of explosives at the project.

In 2009 the environmental ministry revoked the permit given to the company in 2006, based on a federal court ruling in the country.

New Gold added they maintain their production estimates at Cerro San Pedro of between 95,000 and 105,000 ounces, at a cost of C$390 to C$410 an ounce sold.