SAO PAULO, March 6 (Reuters) - A Brazilian court denied a request by Norwegian aluminum maker Norsk Hydro ASA to resume full operations at its unit Hydro Alunorte, the court said in a statement, in the latest setback after allegations it had contaminated water in the area.
Norsk Hydro had appealed to a higher court after a judge last week ordered the company to halve production at Alunorte. The complex, located in Barcarena in the northern Brazilian state of Pará, is the world's largest alumina refining installation.
Hydro declared force majeure at its Alunorte unit on Friday after the order to cut production.
On Monday, Judge Leonam Gondim da Cruz Júnior decided against granting an injunction that would allow Hydro to resume full operations, citing potential environmental damage in the region.
Local authorities accused Alunorte of contaminating water supplies when heavy rains hit the region. Hydro has said it found no evidence of any such pollution.
A federal institute linked to Brazil's Health Ministry said it has indications of overflow of Alunorte's effluents, causing high levels of aluminum in the water.
Norsk Hydro Chief Executive Richard Brandtzaeg, who flew to Brazil to deal with the issue, told Reuters on Monday the company was unsure when it would be able to resume full operations. (Reporting by Marcelo Teixeira Editing by Susan Thomas)