(This september 25 story corrects paragraph six to show Selkirk was a sailor, not explorer and inspired Defoe´s Robinson Crusoe)
SANTIAGO (Reuters) - A 20-year quest for a legendary trove of 18th century treasure on Chile's far flung Robinson Crusoe Island is facing fresh obstacles after a local lawmaker filed a claim seeking to block efforts to dig it up.
Representative Diego Ibanez told Reuters he had filed a petition with the country's Inspector General over fears that excavation work approved by regulators last month could cause irreparable damage to the site, which lies within a national park.
"This is an affront to the law that regulates national parks in Chile," Ibanez, a member of Chile's far-left Convergencia Social party, said in a telephone interview. "We hope the Inspector General declares it illegal."
At issue is a collection of jewels and silver and gold coins that purportedly includes papal rings and Incan artefacts.
Treasure hunters speculate the loot was buried by Spanish sailor Juan Esteban Ubilla y Echeverria on one of the three volcanic islands that make up the Juan Fernandez archipelago 600 km (370 miles) west of Chile's central coast.
Robinson Crusoe Island was so named because it was where Scottish sailor Alexander Selkirk was marooned in the 18th century, a tale that inspired Daniel Defoe's novel, Robinson Crusoe.
The treasure, said to be worth as much as $10 billion, has been the subject of an extensive, 20-year search by Dutch-American textiles businessman Bernard Keiser.
In the petition protesting its potential unearthing, Ibanez said his concern is with bringing heavy machinery into the 85-year-old national park and excavating the island's volcanic soils and bedrock, among the unusual natural features which initially prompted its protection.
He cited a prohibition in the park's management plan on "removing or extracting soil ... rock, or earth," and said government permits issued earlier this year violate this clause.
"Keep in mind that they've been looking for this treasure for 20 years and still haven't found it," Ibanez said in the interview on Wednesday.
"There's no indication that this new bedrock excavation is going to bear fruit. We're talking about causing irreparable geological damage. There is simply no justification for that."
An attorney for Bernard Keiser did not reply to requests for comment.
Chile's CONAF forestry commission said in a statement released this week that Keiser's latest request to excavate an area of 20 meters by 20 meters (65.6 feet by 65.6 feet) was in keeping with Chilean environmental law.
"CONAF's main concern is the conservation and protection of the valuable natural and cultural resources in the state's protected wild areas," it said. "Any type of intervention in this area will be duly supervised with the utmost rigor."
Chile's heritage minister, Felipe Ward, said in an interview with CNN Chile this week that he backed CONAF's decision.
"It makes sense to be able to rebut or confirm the existence of these historical remains," he said. "This authorization has existed for 20 years, so the criticism is a bit surprising."
(Reporting by Dave Sherwood and Aislinn Laing; Editing by Sandra Maler)
