Vol. 2 No.6  

Gold mining project goes to the people, as celebrities start picking up the land

Billions of Euro are destined to be invested in a massive gold mining project in Alba county, as protesters against the project start enlisting the help of film stars to make use of land on the proposed site

     Rosia Montana Gold Corporation is going to the public to gain feedback on the construction of its gold mining project on the site of an existing village and over natural habitat in Alba county.
     Meanwhile protesters against the project are recruiting foreign celebrities such as actress Vanessa Redgrave, to “make use” of the land, which they cannot legally own outright.
     This month and in August, Rosia Montana Gold Corporation (RMGC) will go on a roadshow of public debates asking for feedback and concerns about the project.
     Debate will centre on the arguments of mining as the sole source of job creation and social and financial enrichment for the area against the destruction of rock formations, natural habitats, some pollution and the relocation of 500 families to a new village.
     Last month Rosia Montana Gold Corporation (RMGC), backed by Canadian mining group Gabriel Resources, released the Environmental Impact Assessment (EIA), which evaluated the implications of the project on the people and environment.
     This month will begin a series of public debates on the EIA, where whoever wants to ask the company about the project is quite willing to at one of 14 locations around Romania. Following this, the Government will issue a summary of the public impact. Then RMGC will submit an appendix to the EIA report on public comments and proposals, before the Government makes a final decision on whether to give the construction permit.
     “This is the last stepping stone,” says John Aston, a vice president at Gabriel Resources.
     If given mining will begin construction in 2007 and operation in 2009, before closing in 2026, when the rehabilitation of the countryside begins.
     The project needs the resettlement of 974 households. RMGC has relocated 42 per cent of people to a new village nearby.
     Yet NGO Alburnus Maior has started giving out land to famous people so that the company cannot build on the proposed site. Blow-Up actress and far left activist Vanessa Redgrave recently accepted one square metre of land.
     However, legally this may not be binding, because foreigners cannot own Romanian land until 2012.
     “To own the land, Vanessa Redgrave would have to form a company in Romania and that company would own the one square metre of land.” says Victor Constantinescu, real estate lawyer at Biris-Goran. “But there are laws allowing long term and short term use.”
     In response, Alburnus Maior said that Redgrave can lease the land and benefit from it, if she wants to grow orchards, for example, on the land.
     “Several other personalities from Romania and abroad are interested in buying one square metre of land,” said Roxana Pencea, activist at NGO Alburnus Maior.

Moving house

     There are 500 families now in the area affected who will need to voluntarily move to make way for the project.
     “If 100 or 200 families want to stay, we will pack our things and go,” says Yani Roditis, chief operating officer at RMGC.
     “We'll do our best to design around people who do not want to move. If there is one person who it is impossible to design around,we will keep talking those individuals.”
     But Alburnus Maior claims that “involuntary resettlement” has already occurred. However RMGC has not chased anyone from their home.
     “The definition of 'involuntary resettlement' is that 'staying is not an option',” argues Stephanie Roth from Alburnus Maior. “In the case of the the mine development, staying is not an option.”
     VP at Rosia Montana John Aston says the only case in which the company, via a Government decision, will expropriate a property is if the homeowner is trying to take advantage of Rosia Montana Gold Corporation by holding out for an inflated price for their property.
     Since October RMGC has bought no further houses, because the company says it is waiting until a positive Government decision is released, before it starts buying.
     But it has pre-sale agreements with homeowners on a further 18 per cent of the affected area.
     “95 per cent of residents are in the process of having their titles clarified and houses surveyed,” says Roditis.

Cyanide use

     Some NGOs have concerns over the use of cyanide, the destruction of rock formations, churches and cemeteries.
     The project will use cyanide and hydrochloric acid in order to dissolve the gold because the majority of this gold is not large enough to be taken out physically.
     But the EIA report says cyanide levels will be “well below” maximum levels that Romanian, EU and US guidelines designate as safe.
     “Concerns about cyanide pollution... are not justified and subtract attention from the real impact of the project on the population and the landscape,” says the EIA report.
     The EIA says the cyanide will be 'detoxified' before it enters a large pool of rock and water and is line with the new European legislation – the Mine Waste Directive – introduced this year.
     RMGC has created a protected zone that includes the main town square and a concentration of buildings declared as having architectural value. The company will also move 410 graves to a location specified by the family of the deceased and relocate unknown graves to new cemeteries.

Employment opportunities

     Current unemployment in the area is running at 70 per cent.
     “If we leave and the mines close, unemployment will be over 90 per cent,” says Roditis.
     The project will have a “multiplier” effect, says Roditis, on the job market in the area, as services and auxiliary industries build up.
“For every direct job usually there are eight to ten indirect jobs,” he says.
     Roth says that the mining company has “no insurer” for the project.
“If production had to stop, we have to provide a financial guarantee that we have sufficient funds to cover its rehabilitation of place,” says Roditis. “We have set aside a financial guarantee.”
     The company will spend and reinvest a total of 3.7 billion USD on the project.
     “Most of the money made will be reinvested,” says Roditis. This will be funded by debt and equity finance from international banks and private banks. If gold is priced at 600 USD, the total gold and silver could generate sales of around 4.8 billion USD, says Roditis.
     The company will need to move two churches, one Greek Catholic and one Orthodox.  RMGC says they will destroy the walls of these churches, but retain the rest of the buildings and its contents, before reconstructing them in a different location with new foundations and walls.
     But the churches' towers will remain intact.
     “We will probably lift these out by helicopter,” says Aston.
      The first of fourteen public debates on the project begin in Rosia Montana, Alba county, at 16:30 hrs on 24 July 2006 at the 'Minerul' Stadium, at 12 other cities and Bucharest on 21 August at Romexpo Multifunctional Complex (Eminescu Sadoveanu) 65-76, Marasti Boulevard at 16.30 hrs.

Mine facts

     The Rosia Montana Project is owned and managed by Canadian Rosia Montana Gold Corporation.
     This includes state mining company Minvest (19.31 per cent), Canadian Gabriel Resources (80 per cent) and minority Romanian shareholders (0.69 per cent).
     Gold mining has been active in Romania for almost 2,000 years.
     The operation will mine up to 13 million tonnes of gold and silver ore per year for about 16 years in four new open pits.
     The project needs 1,258 hectares of land, of which 205 hectares is mined.
    Currently the company employs 300 people, will employ 1,200 during the construction phase and 563 during the operational phase.
     The site is in the Golden Quadrilateral in the Mateliferi mountains, part of the Apuseni mountain range of Transylvania
      Alba county's Corna valley and Rosia valley will be subject to further “alterations” resulting from construction and operation of proposed mine and associated facilities.