Dallas, Texas 12/16/2013 (FINANCIALSTRENDS) – Recently the company Barrick Gold Corporation (USA) (NYSE:ABX) announced that it is going to lay off at least 1500 workers on their Argentina side of the Pascua-Lama gold mine. This project straddles the Chile- Argentina border. All these layoff started because of the suspension of the project by Chile’s environmental regulator in this year. As per the Chile’s authorities this project is causing a major damage to their fragile environment and they want to improve the overall conditions and also want to avoid the extreme water pollution that is being done.
It is to be noted that before these suspension orders came the Barrick Gold Corporation deployed around 10,000 workers and the company never assumed that such problem will occur in the future.
Does that mean the company has deceived its investors?
If Barrick Gold Corporation (USA) (NYSE:ABX)’s previous statements are to be believed they have said that they will not exceed the cost of production or the project set up but now because of the environmental regulations their cost have far exceeded of what was earlier thought. Does that mean the company has deceived its investors? This Pascua-Lama gold mine project seems to be thorn in the neck for the Barrick Gold Corporation and this environmental regulation acted as a final nail in the coffin for them.
This Pascua-Lama gold mine project is situated at a very high altitude on the Chilean-Argentina border and is a very environmentally sensitive region. Does that mean the company will exit out of this project? As per the company’s authorities they are trying their level best to come up with some urgent decisions and this lay off was a part of those decisions. Company is also trying to convince the Chilean authorities about the project and is demanding for more inspections so that they can show them the real picture.