Barrick Gold (ABX) recently announced that the Supreme Court of Chile didn’t approve its appeal of a lower court ruling vis-à-vis sanctions imposed on the company’s Pascua-Lama mine by the country’s environmental regulator. This news could set back the development of this mine anytime soon.
Back in mid-2013 the Chile’s environmental regulator fined the company for not complying with Chile’s environmental requirements with respect to its Pascua-Lama mine – a $16 million fine.
But Chile’s Environment Court found that the environmental regulator didn’t properly determine fines levied against the company. Barrick Gold tried to appeal against this decision in the Supreme Court. Alas, the Supreme Court didn’t approve its appeal – the court ruled that “Barrick is not a party to the case, because the original action was brought against the government regulator”. So now the environmental regulator will have to reevaluate the fines it imposed on Barrick Gold vis-à-vis its Pascua-Lama project.
This news doesn’t vote well for the progress of this mine that has been closed for construction since the fourth quarter of 2013 due to legal and environmental issues. Back in the end of 2012 the company already spent $4.2 on the mine’s construction and completed roughly 40% of the mine. In 2014, the company estimated it would have to incur around $300 million environmental costs.
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