Chile’s top court orders Goldcorp to halt El Morro mine

Chile’s top court orders Goldcorp to halt El Morro mine

El Morro site.

Chile's Supreme Court ruled Tuesday that mining giant Goldcorp (TSX:G), (NYSE:GG) can’t move forward with its $3.9 billion El Morro gold and copper mine until local indigenous groups who oppose the project are better consulted.

The court, Orbe news agency reports (in Spanish), said an environmental permit awarded last year should be put on hold until a fresh consultation, based on an International Labour Organization convention, has taken place with the local Diaguita community, from Chile’s north.

In April, an appeals court rejected the same indigenous group’s attempt to halt the project, saying the Canadian gold miner conducted the required consultation. But the group complained Goldcorp had not done it in the way it should have to regain its mining licence. They also said the mine could pollute a local river and they took the case to the Supreme Court.

This is not the first time Goldcorp has to suspend construction at the site. It happened in 2012 and then again in November last year.

The Diaguita also opposed the massive Barrick Gold (TSX:ABX) Pascua-Lama project, stalled since 2013.

Goldcorp holds a 70% stake in El Morro. New Gold (TSX:NGD) owns the other 30%. Due to begin operations in 2017, the mine has proven and probable reserves totalling 6.7 million ounces of gold and 4.9 billion pounds of copper.