UPDATE 3-Barrick strikes deal with Pascua-Lama mine opponents

Wed May 28, 2014 5:17pm EDT
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(Adds comments from Barrick, mining minister, writes through)

By Fabian Cambero

SANTIAGO May 28 (Reuters) - Canadian miner Barrick Gold has come to an initial agreement with local indigenous peoples in Chile who have opposed its stalled Pascua-Lama mine, taking a first step on what my be a long road to reactivating the project.

Barrick, the world's largest gold miner, halted the gold and copper project on the Chilean and Argentine border last year after investing $5 billion in it.

Pascua-Lama, which Barrick had been counting on to provide a large share of its future gold production, has been plagued by permitting issues, cost overruns and a sharp drop in bullion prices, as well as the strong and organized opposition of the local Diaguita indigenous communities.

The new memorandum of understanding between 15 of the 18 communities and Barrick is an initial step towards bringing the two sides together, Lorenzo Soto, the lawyer for the Diaguita, told Reuters on Wednesday.

"A new phase in the way that large-scale mining is done in Chile has begun," said Soto, who is known for representing indigenous communities in cases against mining projects, including Goldcorp's El Morro mine, located near Pascua-Lama.

Barrick's office in Chile said in a statement that the new initiative leaves behind the "sourness" of the past.

"Although Pascua-Lama is suspended today, our aim is to obtain the permits to restart construction," Barrick said. The company recently met with the Chilean mining minister to express its interest in continuing with the project, the minister told Reuters last week.   Continued...