Chile Wednesday approved a controversial project by the world's leading gold producer, Barrick Gold, to tunnel for the precious metal underneath three glaciers in the northern Andes mountains.

The Pascua Lama project was unanimously approved by a regional environmental group after Barrick gave up on its original plan to destroy the three glaciers in the northern Atacama region in order to reach the underlying gold deposits.

Independent environmental groups vehemently opposed the original, 1.5 billion dollar project, fearing that the missing glaciers would dry up stream systems feeding towns and villages in the Huasco Valley below.

"After its environmental review of the Pascua Lama mining project, Atacama's Regional Environmental Committee (Corema) has decided to prevent any type of physical interaction with the glaciers," Atacama Governor Rodrigo Rojas told reporters on announcing the committee's decision.

He said the mining project would have to comply with "a series of rigurous measures" designed to protect the region's natural water supply, which would be monitored regularly for contamination.

With heaquarters in Toronto, Canada, international mining company Barrick Gold first proposed the Pascua Lama project in 2001, but abandoned it after gold prices fell. Three years later, the project was resurrected only to meet with staunch opposition to the glaciers' removal.

Despite the restrictions imposed on the mining project, which will now require digging tunnels under the glaciers to reach the estimated 17.6 million ounces of gold trapped in the rock, some environmentalists still have concerns.

"Who'll guarantee that the glaciers really won't be damaged," Huasco Valley Defense Committee president Mauricio Rios told AFP.

"Perhaps they won't be harmed directly, but the explosives and the dust in the air will have an impact. The glaciers are under a death sentence," he said, adding that he and other environmentalists will appeal the committe's decision.

Rios said the project would be brought to the attention of the National Environmental Committee and possibly to Chile's Justice Ministry.

"It's not over," he said.