Chilean water regulator fines Lundin subsidiary over sinkhole

Reuters | December 12, 2022 | 2:23 pm Top Companies Latin America Copper

Chile warns area around sinkhole at high risk of further collapse

Water was detected in the Alcaparrosa mine tunnels. (Image by Sernageomin, Twitter).

Chile’s water regulator fined the local unit of Canadian miner Lundin around $138,000 — the maximum possible amount — due to impacts of a mysterious sinkhole that appeared near a copper deposit in late July, the agency announced on Monday.

The 118-foot-diameter (36 meter) sinkhole formed suddenly in the town of Tierra Amarilla, some 413 miles (665 km) north of the capital. The incident is also being investigated by mining and environmental regulators.

The DGA water regulator said the mining works carried out by the firm managing the Alcaparrosa Mine had caused a puncture which permanently damaged the Copiapo River aquifer – an underground geological formation that holds groundwater.

It said that Ojos del Salado – a Lundin subsidiary based in the Chile’s northern Atacama region – must present a follow-up plan within 45 days.

The company said in a statement that it has been notified of the charges and is analyzing the situation, but did not go into further detail.

Lundin owns 80% of the firm, while the remaining stake is held by Japan’s Sumitomo Metal Mining and Sumitomo Corporation.

(By Fabian Cambero and Sarah Morland; Editing by Marguerita Choy)