An environmental court in Chile has confirmed that Barrick Gold's (TSX: ABX; NYSE: GOLD) Pascua Lama open-pit project located on the border between Argentina and Chile must close, according to BN Americas.
"The risk of damage to people's health makes it necessary to close the Pascua Lama mining project as alternatives do not seem viable to operate safely for the environment and public health," the court's president, Mauricio Ovideo, told Chile daily La Tercera, BN Americas reported.
BN Americas reported that the court dismissed Barrick's legal challenge and also fined the company US$9.1 million.
The controversial project was suspended in 2013 by Chile's environmental regulator SMA. But Barrick was waiting for a decision on its request for the environmental court to reverse a permanent closure order from SMA.
The original mine plan for Pascua-Lama, which required a capital outlay in excess of US$8 billion, contemplated an open-pit operation that would have had an effect on three small glaciers in the Chilean side of the Andes. It also involved major construction in the area and huge waste dumps.
In 2016, Barrick began a "drastic revision" of the project and agreed to pay US$140 million to resolve a U.S. class-action lawsuit that accused it of distorting facts related to the controversial project.
Shortly after, Barrick abandoned the idea of an open pit at the site, saying it planned to mine underground instead.
In April 2017, it sold a 50% stake in its Veladero mine in Argentina to Shandong Gold Group in a transaction worth US$960 million. As part of that deal, which made the two firms strategic partners, the Shandong province-based gold miner committed to help Barrick move forward with Pascua Lama.
Later the same year, the company agreed to pay a further US$20 million to a Chilean group in order to settle an arbitration case against the company filed last year after the gold producer halted payments settled in 2005.
This article was written with files from MINING.com.