Antofagasta share price slips on Chilean mine disruption
Antofagasta Plc (LON:ANTO) shares slid more than 2.7 percent to 731.00p by 9:14GMT, after a Chilean court ruled that the company must demolish a critical-for-operations tailings dam at its Los Pelambres copper mine.
The Los Vilos tribunal found that the El Mauro tailings dam impedes the natural flow of a stream to the town of Caimanes, contradicting a Supreme Court ruling from October 21, 2014.
Antofagasta disagreed with the March 10 ruling and immediately said it would appeal, in a statement released this morning. The company said it had done considerable work to implement the October 21 Supreme Court ruling, adding that demolishing the dam would endanger the environment.
“Los Pelambres has undertaken significant works to ensure the flow of the Pupío stream is not altered,” Antofagasta said in the statement. The company “believes the implementation plan submitted to the [Supreme] Court went beyond these requirements”.
The company also said that it reserves the right to continue operating the dam until the appeal process has concluded.
The tribunal’s decision follows protests which disrupted work at the mine. Residents of the town of Caimanes partially blocked access to the facility on February 28, insisting the mine dam was diverting an unjustified quantity of water in a time of harsh drought.
The mine has since used an alternative dam for tailings disposal, and the Chilean government intervened, partially restoring access to the mine and arranging negotiations for a resolution.
Antofagasta estimated the impact of the situation was about 5,000 tonnes as of March 8. The mine’s output for 2014 amounted to 405,000 tonnes.
As of 09:41 GMT, Tuesday, 10 March, Antofagasta plc share price is 732.00p.
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