October 19, 2011 / 9:35 PM / in 6 years

UPDATE 1-Canada natives assail plan to revive rejected mine

* British Columbia mine plans could be harmed - natives

* Taseko says new plan addresses environmental concerns

* Deadline for deciding on new assessment is Nov 7 (Adds reaction from Taseko)

By David Ljunggren

OTTAWA, Oct 19 (Reuters) - If Taseko Mines TKO.TO presses ahead with a plan to build a mine on aboriginal lands in British Columbia it could harm the Canadian province’s plans to expand the mining sector, a native leader said on Wednesday.

Last November, the federal government turned down Taseko’s bid to build its C$1 billion ($1 billion) Prosperity gold-copper mine on the grounds that it would do too much environmental damage.

The company has now submitted an altered bid which it says addresses Ottawa’s concerns. But aboriginal groups - which are particularly influential in British Columbia - complain the new plan would do even more damage than the first.

One native leader said the affair could impede the Pacific province’s strategy of opening eight mines and expanding nine existing mines in the next four years.

Aboriginal groups, who refer to themselves as First Nations, have in the past sought to drag out the already lengthy process of gaining approval for industrial projects by launching lawsuits.

Stewart Phillip, president of the Union of British Columbia Indian Chiefs, said he did not “think it would be a prudent notion to sacrifice” the province’s mining strategy for the sake of Prosperity.

“We suggest that in the event this proposal were to move forward it would poison the well, so to speak, and it would undermine the ability of indigenous groups, industry and government to come together,” he told a news conference.

“We’ve indicated ... that we want to work with the provincial government and move forward on a (mining) strategy but this particular issue could give that a black eye and undermine that goodwill that is currently there,” he said.

Taseko spokesman Brian Battison dismissed the idea the new project posed more risks than the original one, saying the company planned to spend an extra C$300 million on measures to protect the environment.

“It’s disappointing they (the native leaders) would take that position. I‘m not sure how much they actually know about our project, given that they’ve refused to talk to us,” he said.

Taseko issued a statement on Tuesday saying the mine would add 71,000 jobs over 20 years.

The project, a conventional open-pit mine located about 125 km (80 miles) southwest of Williams Lake, British Columbia, is expected to have a 20-year operational life with a production capacity of 70,000 tonnes of mineral ore per day.

The Canadian Environmental Assessment Agency must decide by Nov. 7 whether the federal government needs to order a new environmental assessment for Prosperity. Such a study would take around a year to conduct.

Battison said he expected the agency to recommend a full review and said he was optimistic the mine would be approved.

Native leaders said they were confident the second assessment would also rule against the mine but expressed frustration the company was trying again.

$1=$1.01 Canadian Reporting by David Ljunggren; editing by Peter Galloway

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