Barrick's Pascua-Lama permit could be cancelled by government regulators

January 22, 2015

Barrick Gold Corp’s permit for its Pascua-Lama project could be in jeopardy of being cancelled by Chile’s environmental regulator.

Reuters reported that Cristian Franz, head of Chile's environmental regulator, known as SMA, is re-evaluating penalties on the Pascua-Lama project. Franz told local daily newspaper, Diario Financiero, that the process could include cancelling the embattled mine's permit.

"The new sanction can fall anywhere on the spectrum allowed by the law, which goes from a warning to revoking the environmental permit, including fines," Franz told the paper. "I can say that I don't rule out any scenario," Franz added.

Chile's environmental regulator fined Barrick $16 million in May 2013 for not complying with some of the country's environmental requirements for its massive gold and silver project.

But then the country's Environment Court found the fines were not properly determined and subsequently the Supreme Court said it would not hear an appeal by the Canadian miner.

That left the door open for the SMA to re-evaluate the fines it previously imposed.

At one time its biggest new development project, Pascua-Lama's development was halted by Barrick in October 2013 after it spent more than $5 billion.

The project, straddling the border between Chile and Argentina, had been plagued by political opposition, permitting issues, labor unrest, cost overruns and a falling gold price.


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