Barrick Gold Corporation (USA) (NYSE:ABX) decision to halt Pascua-Lama project has international repercussions

Posted In Politics - By Carolin Roth On Tuesday, November 5th, 2013 With 0 Comments

Dallas, Texas 11/05/2013 (ustradevoice) – The decision of the Barrick Gold Corporation (USA) NYSE:ABX) to stop work on its big Pascua-Lama project that lies on the border of Chile and Argentina has brought into fore huge differences  between the two South American nations over mining and energy investment, according to a Reuters report.

Argentina which has always championed the cause of nationalism is now supporting the closed project while Chile that business friendly has due to its following of strict environmental laws ensured that the work on the project is halted. The announcement by the Canadian company to stop the project was a huge blow for Argentina as it was trying to attract Billions of dollars to develop its shale oil and gas resources.

The project had the support of President Cristina Fernandez’s leftist government, which was trying to change the countries reputation of intervention, nationalistic rhetoric and runaway inflation. Argentina made attempts to keep a distance from the decision saying that Chile was responsible for it as it had ordered the suspension of mining due to its fear that the same would cause harm to the environment.

In a statement Argentine Planning Minister Julio De Vido said that the delays in the project due to court cases in Chile were responsible for the company deciding to halt work. The project was hit by cost overruns and drop in global bullion prices.

The project was to be one of the biggest mining complexes in Chile and it would have spelt an economic boon for Argentina, which is fighting high inflation. The project was supposed to produce 850,000 ounces of gold a year in its first five years, and in what the the company has accepted was its problems with constructing in the top ranges of the Andes amongst fears that would lead to a damage in glaciers and water quality.

About the Author

- Carolin Roth graduated from North Dakota University getting both Bachelor’s and Master’s Degrees in Broadcast Journalism.

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