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Chile starts environmental probe into Pascua-Lama
SANTIAGO Jan 21 (Reuters) - Chilean environmental authorities said on Thursday it began a probe into the construction of top gold miner Barrick's massive Pascua-Lama project, which could lead to fines or even a revoked concession.
The Atacama region environmental commission said the investigation started on Wednesday and the company has 10 days to deliver information on construction, but a time-frame for a decision on any sanction was not yet determined.
Barrick (ABX.TO) said the environmental audits are standard in Chile when mining projects are under construction.
"The facts at this point are not yet established, so we are cooperating with authorities. They are doing their job and we need to do ours to ensure compliance under the permits and regulations," said Barrick's spokesman Vince Borg, adding that authorities have not suspended construction at the deposit.
Pascua-Lama, one of the world's last known mega-gold finds, which straddles Chile and Argentina, holds some 18 million ounces of gold and should produce on average 750,000 to 800,000 ounces of gold annually over its first five years.
The play is also one of the world's top silver deposits, with initial annual production of 35 million ounces.
Gold prices fell nearly 2 percent to below $1,090 an ounce on Thursday, their lowest level this year, as the dollar hit a near six-month high versus the euro and reduced buying of the precious metal as an alternative asset. [ID:nLDE60K11K]
Barrick gave a green light to the project in May after the two countries arrived at a long-awaited tax agreement on the project. Protests from environmental groups that charged the project would contaminate nearby glaciers and threaten water supplies for humans also helped delay construction.
The environmental commission said the probe was looking into a water source to the project, monitoring of construction work noise and control of dust levels. (Reporting by Fabian Cambero and Alonso Soto; editing by Jim Marshall)
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