Barrick Gold to submit water plan to Chile authorities soon

Wed Jun 5, 2013 11:17am EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Julie Gordon

June 5 (Reuters) - Barrick Gold Corp plans to give Chilean regulators a water management plan for its delayed Pascua-Lama mine "imminently", and says the project will be one of its key assets once production finally starts.

But the world's largest gold producer said on Wednesday it could not yet say what impact implementing the water plan would have on the timing and cost of the project, which is slated to produce 800,000 to 850,000 ounces of gold and 35 million ounces of silver a year in its first five years.

"Until this plan is approved, we can't establish a definitive time frame," Chief Financial Officer Ammar Al-Joundi said at the Credit Suisse Canadian Precious Metals Conference.

"Once we have that, then we will be able to take a look at the overall project, take a look at the impact on scheduling and costs and everything else."

A Chilean court ruling in early April partially halted construction at Pascua-Lama, which straddles the border between Chile and Argentina, amid claims that Barrick, the world's largest gold producer, has damaged glaciers and water supplies.

In May, Chile's environmental regulator fined Barrick nearly $16 million and ordered it to complete a water management system in accordance with its permits before restarting construction.

That will delay the start-up of Pascua-Lama past 2014 and will likely impact the cost of building the massive mine, which is already budgeted at $8.5 billion. Barrick has so far spent around $5 billion on the development.

The delay is just the latest hurdle for the project, which Barrick has had on its books for more than a decade. Last year, the miner pushed back first production by a year to 2014 and raised its estimate of capital costs by about 70 percent.   Continued...