French court allows CVRD to continue work on Goro

French court allows CVRD to continue work on Goro

Reuters

2nd February 2007

TORONTO, Feb 2 (Reuters) - A French court overturned on Friday a ruling that required CVRD Inco to stop work on a section of its Goro nickel project in French overseas territory New Caledonia.

The Paris Court of Appeal said there is no evidence that the construction of Kwe Ouest, which is a section of Goro that is set up as a storage residue facility, poses an imminent risk to the environment.

"We are pleased by the court's decision, which is favorable to us and wil allow us to resume full construction activities at Kwe Ouest," said CVRD Inco spokesman Steve Mitchell.

"We remain strongly committed to building a project at Goro that incorporates the best environmental principles and is acceptable to the community."

In November 2006, a Paris tribunal had ordered the company to stop clearing land at Kwe Ouest after local activist group Rheebu Nuu filed a complaint saying the nickel project is damaging the environment.

But at the request from New Caledonia's provincial government, CVRD Goro continued to work on Kwe Ouest to secure it for environmental reasons.

Companhia Vale do Rio Doce, the world's biggest iron ore miner, acquired Goro when it gained control of Canada's Inco in 2006. Goro is expected to start production at the end of 2008 and costs are seen at about $3 billion. At full capacity, it will produce 60,000 tonnes of nickel a year.