ECONOMY

Eldorado CEO says mining halt in Greece will cost 600 jobs

eldorado-ceo-says-mining-halt-in-greece-will-cost-600-jobs

Canadian miner Eldorado Gold expects the suspension of much of its mining activities in Greece after confrontation with the country’s leftist-led government will cost more than 600 jobs, its chief executive said on Tuesday.

The Vancouver-based gold miner had to resort to Greece’s top administrative court to annul a government decision that revoked its mining permit in northern Greece on environmental concerns. It won a favorable ruling in November.

The government revoked Eldorado’s permit in August, disputing the miner’s tests for a so-called flash-melting method to ensure against any environmental damage.

“Our investment is treated as a political toy, we never anticipated this,” CEO Paul Wright told reporters in Athens. “Failure to receive timely licenses and permits has proved very expensive.

“It's bad for Greece because it is seen as such from off-shore,” he said.

Wright will meet with leaders of opposition political parties and Energy Minister Panos Skourletis in the next days.

Skourletis told Parapolitika radio earlier on Tuesday the government would not be blackmailed.

“Judging from the behavior of the company, it is another attempt at creating blackmailing situations. No company, Greek or foreign can blackmail the Greek state,” he said.

On Monday, Eldorado said it would suspend construction at its Skouries project in northern Greece and warned that it would do the same at its Olympias project if it did not receive a permit by the end of March.

Eldorado has said it has created around 2,000 direct jobs in Greece, which suffers from a jobless rate of 25 percent, the highest in the eurozone.

Its Greek assets make up about 30 to 40 percent of the company's net asset value, according to analysts’ estimates. Eldorado’s shares have shed 40 percent in the last 12 months, largely due to its problems in Greece.

Wright said the treatment of Eldorado by the Greek government would be seen as a litmus test by other potential investors in the country.

Asked whether the company was considering pulling out, Eldorado's CEO said the miner is not considering giving up on its investment.

“No, we are here for a long haul,” Wright said.

[Reuters]