Chilean Regulator Fines Japanese-Owned Copper Mine $12 Million for Environmental Violations

SANTIAGO, Chile

Chile’s environmental regulator SMA has fined Japanese firm Pan Pacific Copper $11.9 million USD for environmental violations at its Caserones copper mine.

It is the second-highest fine the SMA has issued. Barrick Gold’s Pascua Lama Mine received the highest -- $16 million USD.

The SMA found a number of infractions at the Caserones mine, including failure to implement mitigation measures to prevent the groundwater contamination and construction of unauthorized transmission lines.

The mine, located in the Atacama desert region, is 77 percent owned by Pan Pacific Copper, which is turn is controlled by JX Nippon Mining & Metals, with Mitsui & Co Ltd holding the remaining 23 percent.

“Our country needs initiatives and investments to grow and develop, but they must be very rigorous in complying with environmental obligations,” said SMA chief Cristian Franz.

JX Nippon Mining & Metals’ Public Relations Manager Masayoshi Yamamoto said: “We have responded to all directives given by the regulator in 2013, and we have implemented all measures and constructed all facilities to comply with the rules.”

Mining makes up a significant portion of Chile’s economy -- copper mining alone accounts for more than a third of government income. But the water-intensive nature of the industry has often created conflicts with local communities who fear mining projects will affect the quantity and quality of their drinking water sources.

Earlier this week, mining company Antofagasta said it might have to close its Los Pelambres mine, after a court ruled against the mine and in favor of local residents who claimed the facility was affecting water availability. They had demanded that the miner build a desalination plant.

London-based Anglo American and Australian miner BHP Billiton have both said they expect to see lower production this year due to ongoing drought in Chile.

Canada-based Barrick Gold saw its massive $8.5 billion USD Pascua Lama mining project grind to a halt in 2013, after SMA found that the mine was in violation of its environmental work permits. The violations had been brought to the attention of the regulator by the local Diaguita indigenous people, who were worried that the mine was polluting their water downstream, as well as affecting nearby glaciers.

Free