06/12/2012 12:19 EDT | Updated 08/12/2012 05:12 EDT

Mining company says environmental group's accusations are wrong

WINNIPEG - San Gold Corporation says tree-cutting near an eastern Manitoba gold mine was approved by the provincial government and not a early start on a new tailings pond.

The trees were cut in the same area where San Gold plans to expand its tailings pond — a project that is currently being reviewed by the province. The Wilderness Committee accused the company of clearing trees in order to start the pond expansion before it received approval from the province.

"We received a licence ... to harvest timber. We can harvest timber anywhere on our grounds," San Gold president and CEO George Pirie said Tuesday. "We're in full compliance with everything. We're certainly not trying to sneak anything."

The Manitoba government verified that a permit was issued for the area, near Bissett, Man.

The committee's campaign director, Eric Reder, said he stumbled upon the cleared area during a recent visit.

"When we drove up past Bissett, we could see the existing tailings pond and as we drove down the road, suddenly there was a newly bulldozed path into the forest and you could see that the entire area was completely razed," Reder said.

"The entire thing has been logged and cleared of all the vegetation."

But Pirie said logging in the area is common. Work is contracted out and some of the timber ends up going to a mill in nearby Pine Falls.

Like the existing tailing pond, the proposed 98-hectare pond will drain into a tributary of the Wanipigow River upstream from Lake Winnipeg. Public hearings were held last fall and public comments on the project were to be submitted to regulators by May 24.

A decision on whether the project will be approved is still pending.