March 30, 2017 / 2:42 PM / 2 years ago

Argentine province to suspend some Barrick activities: report

BUENOS AIRES/TORONTO (Reuters) - Argentina’s San Juan province ordered Barrick Gold Corp to suspend some activities at its Veladero mine after a pipe carrying gold-bearing solution ruptured on the leach pad, state-run news agency Telam reported on Thursday.

Workers walk near Barrick Gold Corp's Veladero gold mine, on the Argentine side of the border district between Chile's Huasco province and Argentina's San Juan province, a few kilometers from the site for the Pascua Lama gold project, some 834 km (518 miles) northeast of Santiago, Chile, February 28, 2007. REUTERS/Pav Jordan

Reuters could not immediately reach the provincial government to confirm the report. A spokesman for Barrick said the Toronto-based company was confirming its understanding of the order.

Barrick said on Wednesday that a monitoring system at the mine had detected a rupture on the pipe on Tuesday night. The issue was “quickly corrected,” it added, following procedures to contain and mitigate the situation.

All solution was contained within the operating facility and there was no impact to people or the environment, Barrick said in the statement.

Barrack experienced similar issues in September 2016 and September 2015. Last September, mine operations were suspended after falling ice damaged a pipe and spilled some ore saturated with cyanide solution over a berm, or raised bank.

One year earlier, authorities suspended operations after a cyanide solution spill, which was caused by equipment failure.

The open pit mine is expected to produce 770,000 to 830,000 ounces of gold in 2017, at an all-in sustaining production cost of $840 to 940 per ounce of gold. Spot gold was trading at $1,243.68 an ounce on Thursday afternoon.

Veladero accounts for about 14 percent of Barrick’s total gold production, RBC Capital Markets analyst Stephen Walker estimated in a note to clients.

“While we view this latest issue as a slight negative for Barrick’s shares, the company has stated that there has been no impact on production at this time,” Walker wrote.

Barrick shares were down 2 percent at C$25.06 on the Toronto Stock Exchange on Thursday afternoon, amid broad declines for gold miners as the price of bullion slipped alongside a stronger dollar.

Reporting by Caroline Stauffer in Buenos Aires and Susan Taylor in Toronto; Editing by Jeffrey Benkoe and Peter Cooney

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