A mine’s long journey into closure

Television images of the approximately 100 miners on a hunger strike, holed up in the basic metals mine of Stratoniki in Halkidiki, give a tense feeling of drama. Angry and desperate, the miners, who have not been paid for five months, are now demanding assurances about their jobs, after their employer, TVX Hellas, filed for bankruptcy. This is no ordinary mine. The locals say it has been in operation for most of the last 2,300 years, since the time of Philip of Macedon, father of Alexander the Great. «There is nothing else for us here,» they say. «When I went to the area about 20 years ago, work in the mine for the locals was equal to most other Greeks’ dream of a position in the public sector. It was like a dowry but if you took a stroll through the local cemetery, you saw the average age of death was 50 years old,» says colleague Stavros Tsimas. The concern belonged to the Bodosakis mining group, and was one of two in the area, the other being a defunct gold mine in nearby Olympias. Alexander Bodosakis’s murder by the terrorist November 17 group in 1988 signaled the beginning of the end for the mine, which went into liquidation in 1992. No investors appeared even when the mine was to be given for free. The current Deputy Economy Minister Christos Pachtas, a local MP, was deputy industry minister in 1994. He took a strong interest in the matter and issued a tender that included the gold mine. After two unsuccessful tenders, Canada’s TVX Gold Corporation bought the mines for 11 billion drachmas (about 32 million euros) in 1995. The company submitted a study for a $250-million investment scheme, $13.5 million of which was for environmental protection projects. The relevant bill was approved in Parliament by all parties, except the Communists. But problems were not late in starting. TVX carried out an environmental effects study that described a different method for washing gold than the one in the bill. As the investment scheme began to take shape, local reactions grew, headed by Panayiotis Florinis, the New Democracy-affiliated mayor of the nearby Stageira Municipality. Rumors had it that hotel interests were fueling the protests initiated by New Democracy and Communist Party activists. The reactions developed into road blockades of access to the mines and, in the autumn of 1997, culminated in outraged protesters abusing the staff of TVX Hellas by burning company vehicles and causing a lot of other damage also. Their argument was that the environment was in serious danger. The company counter-argued that only the continued operation of the mine and processing of residues with a large content of arsenic ensured environmental protection. The angry scenes continued and former miners were seen to be drinking water outside the mine, in an attempt to demonstrate its safety and convince everyone that the Canadian mine-owners were only out to steal their precious gold. Experts say that if the processing of residues stops and they are left to enter the water table, the area is finished – their PH is near two on the scale, which means high toxicity. The investment foundered for good when the Council of State rejected the company’s environmental study and vindicated the Stageira Municipality. «There is no metal-mining company in the world that does not know the history of TVX. We won’t find a second fool,» said Federation of Greek Industries Chairman Odysseas Kyriakopoulos. The failure of the Stratoniki investment is not a unique case. Similar reactions have led similar schemes to founder in other Balkan countries. An almost identical case was that of a gold mine near Turkey’s Aegean coast, opposite the island of Chios, where protesters stopped an investment scheme two years ago. Solution in sight? Deputy Minister Pachtas said last week a scheme to include public mining company Larko, local authorities and one or two construction firms was near completion to restart the mine, which would require around 20 million euros. What remains is the most difficult part: finding the investor willing to put up the much larger amounts – estimated at least 10 times more – required to develop the concern. After filing for bankruptcy, TVX Hellas, now a subsidiary of Canada’s Kinross Corporation, sought participation in the scheme with $10 million once its formation appeared on the cards, but only for the gold deposits. When a foreign fund linked to mining operations emerged as a likely partner in the scheme, Kinross said it would withdraw but contribute $10-13 million, roughly the original amount envisaged for the environmental reclamation. On Thursday it returned, saying it wished to remain in the scheme. A new round of consultations begins tomorrow.

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