Romania Puts Controversial Gold Mine on Hold

Romania’s lower chamber, the Chamber of Deputies, on Tuesday overhelmingly rejected a mining law that would have enabled Canada’s Gabriel Resources to start a controversial gold mining project in central Transylvania.

Last September, the centre-left government of Victor Ponta sent a bill to parliament to approve the project to dig for gold in Rosia Montana.

Weeks of protests sparked by environmental concerns, as well as claims that Romania would gain little from the deal, prompted the government to back down and send the law to parliament to change and approve.

The assembly then revised legislation for the mining sector, including provisions that would have applied to the gold mine.

Parliament's rejection puts the entire project on hold for now, though it could theoretically draft new legislation at a later date. That is unlikely to happen soon, however, as Romania is moving towards a presidential election in November.

Gabriel Resources, which has a licence to exploit the gold reserves through its Romanian subsidiary Rosia Montana Gold Corporations, RMGC, obtained a licence around 15 years ago. But it has struggled to obtain all the required environmental and archaeological permits.

The company said it would use the latest environmentally-friendly technology and will preserve Rosia Montana's local heritage. It has also promised to create thousands of new jobs.

Opponents argue that the planned use of cyanide to extract gold poses a threat to the wider environment of Rosia Montana and to nearby archaeological sites.

In recent months, the company appeared to concede that the project was unlikely to get far in the current climate.  In April, RMGC warned that it would lay off 80 per cent of its employees in...