CHILE and ARGENTINA – Strapped for cash in light of low gold prices and continuing resistance to the project, Barrick Gold has suspended construction activities at the Pascua-Lama project on the border of these two countries. The decision cuts $1.0 billion from the company’s 2014 capital budget.
Barrick will, however, continue those activities required for environmental protection and regulatory compliance. The water management system is to be competed by the end of next year.
“The decision to re-start will depend on improved project economics such as go-forward costs, the outlook for metal prices, and reduced uncertainty associated with legal and other regulatory requirements,” the company said in a release.
The company announced in June 2013 that it intended to “re-sequence” construction. That followed an injunction issued by the Chilean court of appeals earlier in the year. At issue were certain “environmental irregularities” cited in charges laid by indigenous people.
So for now the $8.5-billion Pascua-Lama project will grind to a halt leaving nearly 18 million oz of reserves in the ground.
The Barrick website is at Barrick.com.