Romania | Rosia Montana Valley : Gabriel Resources
Located in the Apuseni mountains of west central Romania, the Rosia Montana project would have become Europe's largest open-pit gold mine operation if constructed by Toronto-based Gabriel Resources. But thanks to widespread opposition and court challenges by Alburnus Maior, a local community group, the Romanian government halted the approval process for the project in 2007, forcing Gabriel Resources to reconsider its mine plans and scale back its activities. Community groups have successfully halted the mine ever since. In 2013 the Romanian Parliament rejected the mine once again.
Opponents to the mine have also seen legal victories. In October 2008, a Romanian court ruling agreed with a Ministry of the Environment decision that suspended the Environmental Impact Assessment and permitting process for the Rosia Montana project. Later in the month, Hungary's Prime Minister Gyurcsany Ferenc declared during the Szeged bilateral meetings with Romania that Hungary is continuously opposed to the Rosia Montana mine proposal. Then, in December 2008, the Supreme Court of Romania ruled that the Carnic Massif was protected from mining. Rulings in April 2014 have upheld the Court's position.
Gabriel Resources is now threatening to sue the Romanian government under investment agreements for rejecting the mine. If they make good on this threat, the country could be embroiled in a World Bank tribunal trial for months.
In order for the project to be economically feasible, the Rosia Montana valley, the oldest documented settlement in Romania, would be carved into four open-pit mines. The neighboring valley of Corna would be transformed into an unlined cyanide storage "pond" covering a surface of up to 600 hectares (1,482 acres), held back by a 180-meter high dam. The pits would generate roughly 196.4 million tons of cyanide-laced waste.
Rosia Montana town and valley.
Photo: Alburnus Maior
Local opposition to the mine is based in part on the disastrous experience at the Baia Mare gold mine in Romania, where a cyanide spill in 2000 polluted the Tisza and Danube Rivers, contaminating the drinking water supplies of 2.5 million people and killing 1200 tons of fish. The type of dam proposed in Gabriel Resources' Feasibility Study could pose high economic and environmental risks for the company and the country. According to Dr. David Chambers, geophysicist and Executive Director of Center for Science in Public Participation, Gabriel Resources' Feasibility Study does not detail the risks of a landslide or an earthquake in this area, nor does it describe the standard to which the dam was designed in order to withstand this risk. If the dam were to fail, toxic mining residues could be released into the Abrud River near the dam -- potentially resulting in severe damage similar to the Baia Mare experience.
Should the mega-project fully develop, more than 2000 people would be displaced--many of them are subsistence farmers who do not want to leave their lands--and nearly 900 homes would have to be torn down in order to make way for the mine project. The mine would employ a workforce of 250 to 300 people over the mine's estimated lifespan of 15 years, according to the International Finance Corporation (IFC), the World Bank's private lending arm.
Gabriel Resources, which has no previous mining experience, had approached the IFC for a loan believed to be approximately $250 million. According to Dundee Securities, a financial securities firm, Gabriel Resources' founder and chairman Frank Timis had two convictions for possessing heroin with intent to sell. An earlier venture of Mr. Timis, a Ukrainian petrol company, had been barred from the Toronto stock exchange. (Gabriel Resources is currently listed on the Toronto exchange.)
On October 10, 2002, the IFC announced that it would not financially support the controversial project. In an official statement, the IFC "concluded that it is in everybody's best interest that we do not pursue discussions with the company regarding IFC's involvement in the project."
Gabriel Resources is currently backed by several private companies, including Newmont Mining.
Protesters Rise Up
In September 2013, thousands of people hit the streets of Romania, protesting the Romanian government's decision to approve the development of Rosia Montana. In response to the surge in protest, the government has decided to establish a commission to review legislation and make a final decision on Rosia Montana in November.
For more information:
- Alburnus Maior: www.rosiamontana.org/
- Open Letter to Canadian Parliament on Rosia Montana, from Earthworks and civil society partners
- Financial Times: Gold is Not Enough. April 08, 2004.
- Metals Week: "Romania blocks Rosia Montana gold mine." September 12, 2007.
- Market Wire: Gabriel Announces Plans to Scale Back Activities at Rosia Montana. December 4, 2007.
- Mines and Communities: A Romanian cyanide ban could poleaxe Gabriel's gold mega project. Radu Marinas. Reuters. December 6, 2007.
- "Gabriel plans to sue Romania." Metals Week.November 12, 2007.
- Center for Science in Public Participation Comments on the Rosia Montana Feasibility Study. Dr. David Chambers.
- Mineral Policy Center: Evaluating Risk: Investors' Guide to Gabriel Resources' Rosia Montana Proposal. Alburnus Maior, CEE Bankwatch, Nov. 2002.
- Dr. Horia Ciugudean: An evaluation of the Environmental Impact Assessment Report for Rosia Montana Project with an Emphasis on Archeological and Cultural Patrimony issues.
- Dr. Robert Moran: Review of the Rosia Montana Environmental Impact Assessment Report with a focus on water and water quality-related issues. 2006.
- Alburnus Maior: Taking it To the Top. Press release chronicling the climb of Mont Blanc to call attention to the campaign to save Rosia Montana.