The government signed on Friday a revised contract with Eldorado Gold Corporation, covering its mining operations in northern Greece, where it has faced repeated stalling over licensing delays and environmental concerns.
Eldorado has been in talks with the Greek government on a revised investment plan that would secure higher royalties from mining development and new jobs.
Shares in the company gained nearly 9% on the Toronto Stock Exchange on the amended agreement that includes an investment plan for the miner’s Skouries, Olympias and Stratoni/Mavres Petres mines and facilities in northern Greece, known collectively as the Kassandra Mines.
The contract will now allow for the completion of construction at Skouries and the transition of the project into production, the expansion of Olympias to 650,000 tons per annum and further investment in exploration at Stratoni/Mavres Petres, among other things, Eldorado said.
The investment plan has been revised to $3.1 billion from $1.4 billion and all three mines will remain open and be upgraded, while a total of 3,070 of workers will be employed, up from 1,650 today, Energy Minister Kostas Skrekas said.
Under the revised contract, Eldorado will submit a new proposal for building a gold processing plant in 12-24 months, while there will be a 10% rise in royalties for Greece, Skrekas added.
The government has pledged to unblock foreign investment to lift an economy that shrank by a quarter during a decade-long financial crisis, and help power the recovery after the coronavirus pandemic.
In a joint statement the embassies of Canada and the United States in Athens welcomed the signing of the agreement: “These investments will meet the highest environmental standards, create up to 5,000 direct and indirect jobs in northern Greece and deliver increased revenues for the Greek economy,” stated Canadian Ambassador Mark Allen and US Ambassador Geoffrey R. Pyatt.
“We especially welcome Eldorado Gold’s commitment to a significant social development program amounting to €70 million in the local communities over the life of the investment. We also recognize the dedicated efforts of the government to make Greece an attractive destination for global investment and welcome the mutual benefits that will bring,” the statement added.