Barrick Gold Corp. (TSE:ABX), the world’s largest gold miner by sales, declined to the lowest intraday level in more than four years after a Chilean court suspended construction of its $8.5 billion Pascua-Lama gold and silver mine.
The shares declined 7.1 percent to C$25.21 at 12:46 p.m. in Toronto on Wednesday.
Barrick said it hasn’t received notice from the court and couldn’t comment on the measure, according to a statement released on Wednesday.
Construction activities in Argentina, where the majority of Pascua-Lama's critical infrastructure is located, including the process plant and tailings storage facility, are not affected, the Toronto-based company said in the statement.
Radio Cooperativa reported that the Copiapo Appeals court accepted an injunction filed by indigenous communities. The court said the project was destroying glaciers and harming water supply.
Chilean Interior Minister Andres Chadwick welcomed the mine's suspension and said he hopes the world's top gold mining company can now fix problems at Pascua Lama.
The suspension is a setback to Barrick, which faces as much as $10.2 million in fines in connection with the mine, which Chile’s environmental regulator said last month has failed to comply with environmental rules.
Once completed, Pascua-Lama is set to be one of the largest and lowest-cost gold mines in the world.
The mine, located 4,500 metres above sea level and spanning the border between Chile and Argentina, is expected to produce between 800,000 to 850,000 ounces of gold and 35 million ounces of silver in its first full five years of production.
In February, Barrick Gold reported a loss of $3.03 billion in the fourth quarter, compared with a profit of $981 million a year earlier. The stock has dropped approximately 40 percent over the past twelve months.