The court's decision comes after environmental groups filed a petition against the scheme, saying it will wreak havoc in the region's pristine wilderness.
A regional environmental review commission had approved the $733m project – located 45km northwest of Puerto Aysén in Chile's remote Patagonia region.
The court accepted the environmentalists' appeal and ruled the commission had ignored a recommendation from the national geology and mining service to reject a soil survey done by the joint venture.
It