Goldcorp to offer new plan for Chile's El Morro mine

Fri Nov 7, 2014 1:25pm EST
 
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TORONTO Nov 7 (Reuters) - Goldcorp Inc is working on a new plan for its $3.9 billion El Morro gold and copper mine in Chile, the company said on Friday, and has withdrawn the project's environmental impact study after Chile's Supreme Court halted development last month.

Vancouver-based Goldcorp, the world's most valuable gold miner by market capitalization, said a project team has started new studies to determine an optimal development plan for El Morro that meets Goldcorp's investment return criteria.

Chile's Supreme Court said on Oct. 7 that local indigenous groups that oppose the project must be better consulted, and that an environmental permit issued for the project last year should be suspended pending fresh consultations.

That decision overturned a local appeals court ruling last April that dismissed an appeal lodged by the local Diaguita indigenous community.

"While we were disappointed with the final Chilean court ruling, it has afforded us a unique opportunity to challenge our previous assumptions within the context of evolving industry dynamics," Goldcorp Chief Executive Chuck Jeannes said in a statement.

"The goal of this effort is to deliver an even stronger project that provides significant mutual benefits to the surrounding community, our employees and our shareholders."

El Morro, which is 70 percent owned by Goldcorp and 30 percent owned by New Gold Inc, has been seen as a large, low-cost copper and gold mine. Goldcorp had planned to start production in 2017.

At the end of last year, Goldcorp said that on a 70 percent basis, El Morro contained proven and probable gold reserves of 6.73 million ounces, and proven and probable copper reserves of 4.89 billion pounds.

Goldcorp shares were up 5 percent at C$22.43 on the Toronto Stock Exchange on Friday afternoon.

($1=$1.13 Canadian) (Reporting by Susan Taylor; Editing by Peter Galloway)