Canadian miner must obey environmental laws, Chilean says in Ottawa

Toronto, May 30 (EFE).- Chilean President Sebastian Piñera said Thursday that Canadian mining giant Barrick Gold must comply with all of the Andean nation's environmental laws if it is to continue with its Pascua-Lama project.

Piñera commented during a press conference he and Canadian Prime Minister Stephen Harper gave in Ottawa.

"Canada is one of three biggest foreign investors in Chile. And over the past decade it has become the largest. So I would like to begin my remarks by saying that Canadian investment is welcome in Chile," Piñera told Harper in response to a question from the media.

"The investment by the Canadian company Barrick was approved in 2001 and approved again in 2006. And they must comply with what we call an environmental impact assessment. But the company has not complied with everything set forth in that assessment," the Chilean president said.

"And we've identified 23 areas in which Barrick will have to improve their behavior with respect to the environment, and the company has agreed to that," Piñera said.

"And therefore, I hope that if they comply with all the conditions that were set from the beginning when this investment was approved, that the investment will be able to continue," the Chilean leader said.

Chile's SMA environmental watchdog said last week that it had imposed an 8-billion-peso (roughly $16.2-million) fine on Barrick and ordered it to halt the Pascua-Lama mine project over environmental violations.

The measures were adopted due to one "very serious" violation and four "serious" violations of Barrick's environmental permit.

Pascua-Lama is a gold and silver project located high in the Andes mountains and straddling the Argentine-Chilean border. Barrick is developing the project at an investment cost of $8.5 billion and expects to start production in late 2014.

The SMA says the world's largest gold miner has not built a system for containing contaminated and non-contaminated wastewater and must do so before excavation activity can begin.

The company also has not adopted temporary remedial, safety and control measures nor delivered information requested by the environmental authority.

In addition to the fine, Barrick was ordered to take urgent steps to correct the violations and to halt construction of Pascua-Lama until it has built the wastewater management system to the specifications of its permit.

According to Barrick, Pascua-Lama has 18 million ounces of proven and probable gold reserves and 676 million ounces of silver contained within the gold reserves.