Barrick halts work on mine after Chile court rules

Published on NewsOK Modified: April 10, 2013 at 8:00 pm •  Published: April 10, 2013
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Barrick says Pascua Lima has 17.9 million ounces of gold reserves, and the company believes it will be one of the world's biggest and lowest-cost mines. But the mine has gone off track. Its start date has been delayed by more than six months to the second half of 2014. Cost overruns rose from an original $3 billion to more than $8 billion last year.

The project has also been opposed by environmental groups in Argentina, where the congress passed a law in 2010 to curb mining around the country's glaciers as a way to protect water supplies.

Barrick obtained injunctions blocking enforcement of the glacier law, but Argentina's Supreme Court ordered the government to prepare a national water resources inventory mapping the location of glaciers and peri-glacial areas —the rocky underbeds that still hold significant water after glaciers have retreated.

"The environmental impact provoked by mining and the Pascua Lama project in particular have been well proven in Chile," said Gonzalo Strano, a Greenpeace coordinator for a campaign protecting glaciers in Argentina.

"With even more reason the project should be canceled on the Argentine side, as it is being developed in a permafrost area protected by the glacier law and within a biosphere that should be shielded."

The company has three other mines in South America: two in north-central Peru and one in Argentina. Those mines produced more than 1.6 million ounces of gold last year, and they are expected to yield about 1.3 million ounces in 2013.

The company also has 10 active mines in North America and nine in the Australia-Pacific region, some of which are operated through joint ventures. Its African operations are run by African Barrick Gold PLC, a separate company in which Barrick Gold owns a 74-percent stake.

Barrick had 140 million ounces in proven gold reserves at the end of 2012, as well as 1.05 billion ounces of silver and 13.9 billion pounds of copper. It expects to produce 7 million to 7.4 million ounces of gold this year.

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Associated Press writers Michael Warren in Buenos Aires and Marley Seaman in New York contributed to this report.

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Luis Andres Henao on Twitter: https://twitter.com/LuisAndresHenao