Chile: Barrick Gold mine may be delayed for years

On May 24 Chile’s environmental regulator, Juan Carlos Monckeberg, ordered a suspension of construction at the Toronto-based Barrick Gold Corporation‘s giant Pascua Lama mine because of violations of environmental laws. He also fined the company $16 million, the largest penalty Chile has ever imposed for an environmental violation. Monckeberg told the Reuters wire service on May 30 that the company would probably require one to two years to make the repairs that would allow it to resume construction.

This is another of a series of setbacks for the $8 billion project, an open-pit gold, silver and copper mine high in the Andes on both sides of the border between Argentina and Chile; if completed, it is expected to be the third largest mine in the world. A Chilean appeals court had already ordered a temporary suspension on April 10. Indigenous people and other local residents in both Argentina and Chile have repeatedly protested the project, which is now about 40% complete. One concern has been the mine’s potential effect on glaciers, a major source of water in the region. Climate change has already shrunk Andean glaciers by 30-50% since the 1970s, according to a study published in January in the journal The Cryosphere. Indigenous Diaguita who live in the foothills near the mine blame cancerous growths and stomach problems they are experiencing on minerals such as arsenic, aluminum and sulfates used in the construction

Barrick officials deny that they might cancel the project. They expect to resume work on the Chilean side eventually, they say, and work on the Argentine side is not affected so far. The international environmental organization Greenpeace called the $16 million fine “laughable” given the seriousness of the violations. The group noted that Barrick posted a $847 million net profit in the first quarter of 2013. (Miami Herald, May 24, from AP; Reuters, May 31)

From Weekly News Update on the Americas, June 2.

See our last post on Barrick’s global operations.