MiningSee 19 December, 2016

Romania vs Gabriel Resources and local communities over Rosia Montana gold deposits

Sitting atop one of Europe’s largest gold deposits, Rosia Montana has for 15 years been at the center of a battle between villagers and Canada-listed mining company Gabriel Resources.
A battle over plans to build a huge gold mine in Rosia Montana, a Romanian village boasting intact Roman mining shafts and 18th century houses, has moved to an international stage, sparking residents’ fears that the project could be resurrected.

Sitting atop one of Europe’s largest gold deposits, Rosia Montana has for 15 years been at the center of a battle between villagers and Canada-listed mining company Gabriel Resources.

Gabriel Resources said the $1.5 billion project to build Europe’s largest gold mine would provide a major boost for Romania’s lagging economy and create hundreds of jobs for the Transylvania region – the legendary home of Dracula.

But local residents fear the mine would destroy historic Rosia Montana, surrounding hillsides, and pollute the local environment with cyanide used in the mining process.

Opposition to the mine sparked nationwide protests in 2013 described as the biggest since the early 1990s anti-communist marches and, facing pressure from locals and international environmentalists, the government blocked the mine.

Gabriel Resources has now moved the fight to the World Bank’s international arbitration tribunal to seek a reported $4 billion in compensation – about two percent of the Romanian economy – for the stalled project.

Residents struggling to keep abreast of developments fear Gabriel Resources and Romania’s cash-strapped government – which faces an election in December and has a minority stake in the project – are working together to keep locals out negotiations.

Alburnus Maior, the campaign group set up by Rosia Montana villagers, fears Gabriel Resources is using a back door to try to revitalize the project while the government delays decisions that would block the mine.

“International arbitration breaches the right of local communities to decide for themselves what kind of development they want,” said Eugen David, a farmer and head of Alburnus Maior who counts actress Vanessa Redgrave among his supporters.

“It also ignores the rulings of national courts, thereby creating a parallel justice system that is accessible only to foreign investors,” he told the Thomson Reuters Foundation.

David said the villagers had been unable to access any documents related to the tribunal process, concerned the mining company and government were blocking access.

But Gabriel Resources Chief Executive Jonathan Henry said issues of transparency and production of documents were a matter for the International Centre for Settlement of Investment Disputes which began on Sept. 23 to hear the case. No second hearing is yet set.

“It is the tribunal that sets up the process regarding transparency after consulting with the parties,” Henry told the Thomson Reuters Foundation.

This is not the first time the massive gold project has hit world headlines.

The battle first took an international twist about a decade ago when highlighted by Swiss-born journalist Stephanie Roth who moved to Romania to fight plans for a Dracula theme park.

She stumbled across Gabriel Resources’ plan and alerted the likes of Redgrave with appeals even made to Prince Charles, heir to the British throne, who is a strong supporter of Transylvania’s natural environment and heritage.

But the new international battlefield is the ICSID in Washington, D.C., which is empowered to settle international disputes about investment and is underpinned by a multilateral treaty signed by more than 150 countries.

An ICSID spokesman said the first hearing only involved debate on “provisional measures” and legal process.

Marcos Orellana, a lawyer from the Centre for International Environmental Law who specializes in international commercial arbitration, was an observer at the first hearing and said arrangements made it hard for the public to follow the case.

He said the hearing was only transmitted on closed circuit TV inside the building although the tribunal can broadcast hearings live on the internet – if the parties allow – and PowerPoint presentations were not made available.

“It is reasonable to conclude that Romania agreed with the company that access should be restricted (and) that the Romanian government did not want its citizens to have access to the hearing,” he said.

The hearing comes as Romanian central bank governor Mugur Isarescu this month kept interest rates on hold, warning that the 2017 budget plans were a risk for the economic outlook.

Earlier this year he said he had never “in 25 years seen bigger dangers to Romania’s economic and financial stability”.

The ICSID spokesman confirmed to the Thomson Reuters Foundation that all the arrangements for the hearing, including using CCTV and a prohibition on recording the hearing, were made “in consultation with the (two) disputing parties”.

He said so far the parties involved in the dispute – the mining company and the Romanian government – had not “authorized” publication of “any of the documents so far submitted to or issued by the tribunal”.

Alburnus Maior originally requested documents relating to the case from the tribunal, stating it needed to see the papers to submit its arguments.

The ICSID spokesman said the documents would be published on its website once the two parties agreed to make them public.

A spokesman for Romania’s Ministry of Finance told the Thomson Reuters Foundation it was the ICSID’s responsibility to release information and that it could not make a unilateral decision to release the documents.

This was echoed by Henry from Gabriel Resources.

Villagers have taken action previously to access documents related to the mining project.

Alburnus Maior asked the Romanian Ministry of Finance in 2015 to make court documents public with the request lodged in a court in Cluj-Napoca, the unofficial capital of Transylvania.

The court ruled in favor of the villagers but the ministry has since lodged an appeal and no papers have been forthcoming.

This start to the tribunal – and several moves by the government to drag its heels on some other key decisions – has made villagers and activists fear the mining project could gain ground again.

David said villagers’ fears were further fueled when Gabriel Resources issued a press release during the September tribunal hearing welcoming a Romanian decision to withdraw a tax claim for $13 million.

The Romanian tax authority confirmed to the Thomson Reuters Foundation that it had given up its claim for the money and it would reassess Gabriel’s tax records.

“The company has always stated it remains ready to explore an amicable resolution of the dispute that includes development of the project,” Henry said in the statement.

Residents also say they want to see progress on an official application to make Rosia Montana a UNESCO World Heritage site that would iron clad its protection.

The government has put the village on a tentative list but confirmed it has yet to complete the official application.

Activists worry too that legislation to ban cyanide-based mining in Romania, sent by the parliament to the government for a legal opinion last year, has not yet received the green light.

Roth, who won the Goldman Environmental Prize for her support for Alburnus Maior, said she feared arbitration might conclude with a compromise that would let the mine go ahead.

“As long as the government refuses to learn by listening to the tens of thousands of citizens who took the streets for Rosia Montana during Romania’s autumn, mistrust, injustice and instability will prevail,” she told the Thomson Reuters Foundation.

source: mobile.reuters.com