27 May 2006

Barrick Gold Backs Out Of Cerro Casale Project

(May 27, 2006) Representatives from Barrick Gold, a Canadian owned gold mining company announced that they were backing out of the Cerro Casale project and leaving the way open for two other mining companies interested in the project.

The Cerro Casale project is a series of open-pit gold and copper mines located in Region III of northern Chile. The project was initially run by Placer Dome, another Canadian mining company, until Placer was bought out by Barrick Gold.

Barrick Gold decided to leave control of the project with two minority investors who were previously working with Placer Dome, Bema Gold and Arizona Star.

“We think that, during the acquisition process, the best thing to do is respect the contracts of the company we bought, said Igor González, President of Sudamérica de Barrick.

Barrick is also involved in the controversial Pascua Lama project, a planned open-pit gold mine located on the border between Argentina and Chile (ST, May 18). Barrick is currently trying to negotiate a tax agreement with both countries to avoid paying double taxes on material produced at the mine.

Both projects have generated criticism because of expected damage to the respective areas’ water systems. The Pascua Lama project would require the relocation of three glaciers and cause disruption of river systems in the glacial watershed area while the industrial waste waters of the Cerro Casale mine cross two national parks.