BUSINESS

Eldorado suspends investment in Greece citing regulatory hurdles

Canada’s Eldorado Gold Corp said on Monday it would suspend investment at its mines and development projects in Greece due to a delay in permits from the Greek government.

The company said no additional investment will be made into the Olympias and Skouries projects and the Stratoni mine in Greece, and will place them on care and maintenance from Sept. 22.

Eldorado is developing the Skouries and Olympias projects in northern Greece, where it also operates the Stratoni mine. Skouries has been a particular flashpoint with the authorities, with differences lasting for years over testing methods applied to comply with environmental regulations.

“These permitting delays have negatively impacted Eldorado’s project schedules and costs, ultimately hindering the company’s ability to effectively advance development and operation of these assets,” the company said in a statement.

The company said it estimates a total of $30 million will be spent to prepare for care and maintenance costs of the assets.

Eldorado said termination of its employees and contractors would be done in accordance with Greece’s labor regulations.

Eldorado has applied for licensing but the energy ministry has said that it would launch an arbitration process this month to ensure that the Vancouver-based miner’s Greek unit, Hellas Gold, respects its contractual obligations.

The company said it was awaiting additional details from the Greek government over the arbitration process and would re-assess its investment options in the country after the approval of the permits.

“Should the Greek government wish to work within the framework of its contractual obligations with Hellas Gold, issue permits in a timely manner and support the investment, Eldorado will then be in a position to re-evaluate its investment plans in the country,” Eldorado Chief Executive George Burns said.  [Reuters]

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