A court in Chile has halted the construction of a huge power plant being built by a Spanish company, after fishermen charged it would harm the environment and ruin their livelihood.

The $1.4 billion Punta Alcalde plant in northern Chile was being built by the Madrid-based company Endesa, Spain's leading electric utility.

The fishermen said the project would despoil the Llanos de Calle National Park and the Humboldt Penguin national reserve, both considered among Chile's natural treasures.

"This could compromise fishing industries resources, with repercussions for marine reserves and biodiversity in the region," Paula Villegas, an attorney for the fishermen, told the CNN Chile news network.

The fishermen were from the town of Huasco in Chile's Atacama region, about 800 kilometers (500 miles) north of the capital city Santiago.

The Punta Alcalde thermoelectric plant was being built to supply power to the region's huge copper mining concerns.

At present, six plants operate in the region, a number insufficient to provide enough power to the energy-hungry mining industry.

In a statement, Endesa defended the project as one of the most efficient in South America, and said the ruling does not definitively prevent construction of the plant.

A court in Santiago issued the order on Friday but it was not unsealed until Tuesday.

Regional environmental authorities had halted the project last year, but were overruled by federal officials who said construction could proceed if some changes were made.

Legal observers said if Endesa appeals the ruling, the case could make its way to Chile's Supreme Court.

A court in March 2012 rejected a similar project, the $4.4 billion Castilla thermoelectric power plant, which was to have been the largest in South America. That decision was upheld on appeal in August last year.