UPDATE 1-Goldcorp's El Morro mine halted by Chile Supreme Court

Tue Oct 7, 2014 2:01pm EDT
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SANTIAGO Oct 7 (Reuters) - Chile's Supreme Court has halted the development of the El Morro gold and copper mine owned by Canada's Goldcorp, saying that local indigenous groups who oppose the $3.9 billion project need to be better consulted.

The court said on Tuesday that an environmental permit awarded last year should be stopped until a fresh consultation, based on an International Labor Organization convention, has taken place with the local Diaguita community.

Goldcorp has just received the ruling and is reviewing it, spokeswoman Christine Marks said. "Goldcorp remains committed to open and transparent dialogue with its stakeholders."

The decision is the latest in a string of rulings that have found against mining companies looking to invest in the top copper exporter. Like many of its resource-intensive Latin American peers, Chile is struggling to find a balance between mining-led growth and environmental protection.

Billions of dollars worth of projects have been put on ice or delayed in recent years, snarled up in red tape and opposed by local communities.

Tuesday's decision overturns a local appeals court finding from last April, which dismissed an appeal lodged by the Diaguita.

The Diaguita - who also opposed the massive Barrick Gold Pascua-Lama project, stalled since last year - claimed that a previous consultation on El Morro was not properly conducted.

They also say the mine in northern Chile is planned on what they deem as sacred ancestral land, and that it could pollute a local river.   Continued...