Canadians Sue Romania Over Halted Montana Gold Mine

Canadian company Gabriel Resources filed a second lawsuit against Romania on Friday seeking $4.4 billion in alleged losses over its stalled Rosia Montana gold and silver project, which the government refused to approve following protests by environmentalists.

Two smaller companies belonging to Gabriel Resources group filed a similar lawsuit in July 2015 at the same court.

They accused Romania of not returning VAT taxes worth 27 million lei [approximately 6.8 million US dollars].  

The lawsuit, claiming Romania violated several investment contract clauses, was filed at the World Bank's court of arbitration, the International Centre for Settlement of Investment Disputes, in Washington.

"The Company has developed and committed to a comprehensive plan of investment for the sustainable development of the Rosia Montana region and all stakeholders, including protection for cultural heritage and cleaning up the widespread environmental damage caused by historic state mining activities. Gabriel's plan for Rosia Montana has always had the support of the majority of local residents," Jonathan Henry, Gabriel's President and Chief Executive Officer, said in a press release.

After spending almost two decades and investing about 700 million US dollars in building the gold mine in Rosia Montana, the company, listed in Toronto, saw its project of opening the biggest gold mine in Europe blocked by the Romanian government in 2014 as it gave in to pressure from environmentalists concerned about the use of poisonous cyanide in the gold extraction process.

The government revoked a bill that would have allowed the project to continue, obliging the company to fire 70 per cent of its local employees.

Anti-corruption prosecutors investigated Rosia...