Barrick Gold Corp’s Pascua Lama Mine was suspended by a Chilean court for “environmental irregularities” on April 10, The Associated Press reported.
The suspension came after indigenous communities complained that the project is threatening their water supply and polluting glaciers to the appeals court in the northern city of Copiapo.
Chile's Environmental Evaluation Service had already been fined Barrick for failing to monitor glaciers during construction of the world's highest-altitude gold and silver mine.
Interior Minister Andres Chadwick welcomed the mine's suspension and said he hopes the world's top gold mining company can now fix problems at the mine.
"We're not surprised at all and we think it is good that through a legal organism, construction work is suspended while Pascua effectively attends to the charges already made by the environmental regulator," Chadwick told local Radio Cooperativa.
Barrick officials told The Associated Press "construction activities are not affected in Argentina," but the company cannot respond to the ruling yet because it had not been notified by the court.
Lorenzo Soto, a lawyer representing the Diaguitas indigenous community said the suspension will remain in effect until the company addresses the problems and consults with the local indigenous group.
Barrick says Pascua Lima has 17.9 million oz of gold reserves, and the company believes it will be one of the world's biggest and lowest-cost mines. But the mine straddling the Andean border with Argentina 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.
Chile is the world's top copper producer and its stable economy largely relies on the export of minerals. Mining also offers many of the country's poor their best shot at a middle-class life, especially in the rugged desert areas of the north, where most of the mines are located.