A Chilean court has approved a $42 million compliance plan submitted by JX Nippon’s Caserones mine to repair environmental damage caused by the operation, despite being currently contended by farmers in the country’s northern Copiapó region.
The plan, previously accepted by Chile’s Superintendency of the Environment (SMA), came after the regulator brought charges against the miner in early 2019 for over-extracting water from wells feeding the mine and leaks from its tailings.
The mitigation program involves measures such as reintroducing desalinated water into the Copiapo River to counter the drought facing the region.
Local farmers had filed a legal challenge to the compliance plan on a technicality that Caserones should have addressed all the 18 infractions of which it was accused. The SMA’s resolution considered it sufficient for the plan to address 16 of the irregularities detected two years ago.
“This court coincides with the analysis of the SMA that it is possible to separate infractions that caused environmental damage from those that did not, and subject them to different avenues of review and correction,” the court said.
Caserones, which is operated by Minera Lumina Copper, a company controlled by JX Nippon Copper, has been a source of ongoing worries for its owners even before it began producing, in May 2014.
The project’s cost more than doubled to $4.2 billion from an estimated $2 billion because of factors including rising labour costs and bad weather.
Once in production, the mine’s output has been consistently below expectations due to a series of technical problems in its ramp-up phase and market conditions, costing its Japan-based owners hefty impairment charges.
The poor performance drove Mitsui Mining last year to sell its stake in the mine, which was acquired by JX Nippon Mining.
Caserones is located at an altitude of 4,200m to 4,600m above sea level in Chile’s Atacama Desert, close to the Argentina border. The area, home to the world’s driest desert, is being affected by a decade-long drought exacerbated by climate change.
Caserones produced 126,972 tonnes of copper last year, close to its original estimated output of 150,000 tonnes of copper concentrate and 30,000 tonnes of copper cathodes a year.