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Construction of a concrete batching plant at Skouries mine. (Image courtesy of Eldorado Gold)
Greece’s left-wing government is asking Canadian Eldorado Gold (TSX:ELD) (NYSE:EGO) to resume halted mining operations and preserve jobs currently in the line as a condition for the two parties to continue talks on the country’s biggest foreign investment.
Environment and Energy Minister, Panos Skourletis, accused the Vancouver-based firm of staging a “political show” and of “blackmail”, adding that Eldorado should understand that “Greece is a modern European democracy,” according to local paper The Greek Reporter.
Eldorado has been in a dispute with the Greek government after Skourletis revoked last year the company’s permit to further develop its Skouries mine in northern Greece.
The country’s ruling Syriza party has opposed the gold project, in the Thrace region, siding with many local residents who have staged several demonstrations. They claim the mine will destroy the environment and harm the area’s tourism potential.
There have also been both pro-mine protests, including one in April 2015 that attracted an estimated 4,000 supporters of the Skouries mine and forced police to shut down major roads in Athens for several hours.
Ultimatum
On Monday Eldorado said it would suspend construction at the Skouries project, putting more than 600 jobs at risk, after a year of confrontations with local authorities that included permits being revoked and delayed by the state multiple times.
The company also warned it would do the same at its Olympias mine, also in northern Greece, which would leave another 500 unemployed. The company said it would go ahead if it didn’t secure necessary permits by the end of March.
Eldorado has already halted development work at its Perama Hill and Sapes projects.
The company is not the first miner to struggle in Greece. In the 1990s, the Skouries and Olympias projects belonged to TVX Gold Inc., which failed to develop them because of local opposition. Eldorado has said it believed it could do better, in part because of its experience in developing mines in both neighbouring Turkey and China.
Currently the company employs 2,000 workers in an area with an unemployment rate above 30%.
9 Comments
sherman
Can you believe these Greek Beggars on 3 bailouts and running for a Fourth……..
Gary
Pull out, let them get back to their sheep and goat herding
Gregory
It is ridiculous to believe that the company halted opperations only because of permiting. What if gold price was 1800 $ at the moment? The company is trying to put the blame on the government or is trying to win some more permits.
In Greece there are also other mining companies that do not have such problems…
Michael K
What is not mentioned in these articles is that the mine is located in one of the most touristic areas of Northern Greece. More than half a million foreign tourists and a huge amount of local tourists visit resorts in Chalkidiki every year. Tourism is an industry that offers a high added value, mining is not. A single accident would be disastrous to the local economy, putting more than 20,000 jobs at stake. A measly 2,000 jobs is not worth to risk one of the most profitable industries in Greece. Find a way to ensure near 100% environmental safety and then we’ll talk.
Edit: I see a lot of people prefer to resort to country shaming one-liners instead of having a fruitful discussion. Really disappointed with the comments in this site.
johnrolce
I’m not going to Grece this year. Was there twice. Dirty and corrupted country.
Mark Harder
This is so absurd. What are is Eldorado supposed to do? Stop polluting. No! You can’t build here. No! Put the miners back to work. No! Your very existence is threatening the people who live here, including your miners. Wait! No! Uhhh…Let me think! Is Greece really as dysfunctional as this makes it seem?
patentbs
This is not a new issue. Been boiling for a long time under different governments. The problem is the current regulator cancelling building permits. Should development be responsible — yes. Why would you go back to work to build something that MAY be declared unusable by the regulator?
The area has tourist potential. A ‘fries with that ?’ job is not what construction and mining people look for.
Myself? I will never invest in any company that plans to spend money in Greece or other jurisdictions that change regulations or nationalizes on political whim. About half the countries in the world are out!
sherman
Mike…… The picture you draw about your Tourism, then why did these Political hacks issue a mining license to Eldorado in the first place? Just to pocket the Cash…….. Can’t they think ahead of what is going to transpire? Is this the reason Greece is a basket case, and Unemployment is skyrocketing, they can’t think? Or is it that they have very deep POCKETS? To allow a company to spend upwards $400,000,000.00 million Dollars and pull this CRIME. THIS WILL CARRY FAR TO EFFECT THE FOREIGN INVESTMENT IN THIS GREECIAN WASTELAND…..What a band of corrupt gangsters fore leadership…….. I am really hoping that Greece does not get the 4th bailout. It will be satisfying to see them fall into the Aegean…
Kenneth Viney
Call this “left leaning govt” what it is. Socialist commies. Eldorado is right in suspending operations. I have been to this country many times. It is a basket case. Now with the 3 bailouts the whole country in on welfare. Europe has spent millions on repairing the historic sites in Athens but nothing is ever finished, The govt officials keep revoking permits until they get paid off and the workers take 40 minute smoke breaks ever 2 hours and they all smoke. What a corrupt dirty place. Even the Chinese cannot clean up the corruption on the docks.