Pascua Lama lawsuit costs Barrick US$140mn
Barrick Gold has reached a US$140mn agreement to settle a class action lawsuit in a New York court, filed by shareholders who purchased Barrick common stock between May 2009 and November 2013.
The plaintiffs alleged that the company and certain current and former executives misrepresented its compliance with environmental regulations and internal controls related to its troubled Pascua Lama project, which straddles the border between Chile and Argentina.
"I am pleased we were able to reach this resolution for investors," James Hughes, Motley Rice lead attorney for the plaintiffs, said in a statement from the law firm.
The lead plaintiffs in the case are Union Asset Management Holding and LRI Invest.
The settlement agreement, which requires court approval, comes two months after the New York court partly denied Barrick's motion to dismiss the suit, granting the plaintiffs' motion for class certification.
Barrick said in a statement that it "continues to believe that the claims alleged by the lead plaintiffs in the litigation are unfounded, and under the terms of the settlement agreement, the company has not accepted any charges of wrongdoing or liability."
Pascua Lama is facing long-running environmental, legal and administrative issues. The estimated investment in the long-delayed project is currently put at around US$8.5bn and it is designed to produce 750,000-800,000oz of gold annually for the first five full years of operations.
Chile's environmental regulator SMA is currently reviewing the fines it imposed in May 2013, following a supreme court decision in December 2014 that could push the penalties up to more than US$200mn. The agency said it expects the new fines to be disclosed by the end of June.
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