The Associated Press June 4, 2010, 10:09AM ET

Controversial gold mine in Romania gets go-ahead

A Transylvanian gold mine project which critics say threatens the environment and an ancient Roman temple was approved for development by the Romanian government on Friday.

Environment Minister Laszlo Borbely said his ministry will clear the construction of two dams by Canadian mining company Rosia Montana Gold Corp. to extract gold from ore. The ministry had rejected the plans in 2007 on safety grounds, but the company filed a lawsuit and a court recently ruled in its favor.

The company still needs to get various permits from water and environment authorities before it can go ahead with the mining project.

President Traian Basescu and the government support the project, which has been bitterly opposed by civil groups, historians and archaeologists, and some politicians. Romania's economy is a in a deep recession and can use any new investments.

Critics say the mine could pollute streams and rivers in case of an accident, pointing out that a cyanide leak at a Romanian gold mine in 2000 killed much of the aquatic life in the Tisza River, a tributary of the Danube River, which runs also through Hungary. They also say the mine would damage a Roman temple and other monuments uncovered in the area.

The minining company argues the mine will develop the neglected area and create thousands of jobs.

Rosia Montana Gold announced about a decade ago that it wanted to mine for gold in Rosia Montana, which has had gold since Roman times. It will reocate hundreds of residents and rip apart a swathe of a mountain range.

The company plans to invest $1.7 billion (euro1.41 billion) at Rosia Montana, 190 kilometers (120 miles) east of the border with Hungary. It estimates a profit of $1.9 billion. According to the company's website, Rosia Montana Gold Corporation has already invested $400 million.

Gabriel Resources from Canada has 80 percent of the company, while a Romanian state-company owns about 19 percent.


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