Activists thwart Balkan gold rush again

Activists thwart Balkan gold rush again
By Clare Nuttall in Bucharest June 15, 2017

Residents of Tran in western Bulgaria have voted overwhelmingly against the restart of production at a nearby gold mine in the latest setback for plans to boost gold output in Southeast Europe. 

The region — along with other parts of the world with under-exploited gold resources — has seen a spike in interest from mining companies within the last decade as gold prices soared following the onset of the international economic crisis in 2008. However, this new Balkan gold rush has sparked strong opposition from local activists concerned about the impact of mining on the environment. 

94% of votes cast in the June 11 local referendum — held despite opposition to the vote from mining group Asarel Medet and the local authorities — were against the plans to resume mining. 

The referendum was held due to concerns that the re-opening of the gold mine would pollute the environment. Asarel Medet commented that the referendum result was expected given the “mass manipulative campaign” among the people. However, President Rumen Radev welcomed the vote in a Facebook post, writing that it was “an example of how responsible Bulgarian citizens organise themselves to defend their rights and to have a say on a problem not only of local but also of national importance”.

In a very similar development in neighbouring Macedonia, citizens of the town of Gevgelija resoundingly voted 'no' in a referendum on whether to open two gold mines in the area in April.

Reservoir Minerals, a company that was purchased in 2016 by Canada-based miner Nevsun Resources, had planned to open the mines on Mount Kozuf after gold deposits were found northwest of Gevgelija. However, of the 68% of the local population that cast their votes in the referendum, оver 97% voted against the mine project. 

The vote followed an aggressive campaign by local environmental groups who said the authorities should not issue a licence for opening the mines because of the impact of mining on the environment in the area near the Greek border. They argued that the gold ore would be extracted with explosives that would ruin the mountain, while the use of cyanide for separating the gold would have disastrous pollution effects in the area, which is mainly used for agriculture but also for tourism.   

Romania is another country where citizens have successfully been mobilised against gold mining. The “Save Rosia Montana” campaign against Toronto-listed Gabriel Resources’ Rosia Montana gold project brought tens of thousands of people out onto the streets in 2013. 

Gabriel Resources, the main owner of Rosia Montana Gold Corporation, has been trying for the past 15 years to move forward with plans to develop Rosia Montana, which it says could become the largest gold mine in Europe. However, conflicts between rival political factions as well as the Rosia Montana protests have resulted in repeated delays. The project is currently the subject of international arbitration at the International Centre for Settlement of Investment Disputes. 

Elsewhere in the region, plans to start mining gold and copper ore in an area of virgin forest in Turkey’s Cerattepe region sparked protests in 2016. In Greece, environmental protests against Canadian Eldorado Gold’s plans to develop the Cassandra Mines eventually resulted in a government decision to revoke the company's licence — which was followed by counter-protests by miners angry at losing their jobs. 

The controversial Balkan gold rush is a global rather than a local phenomenon. As the international economic crisis gathered pace in the years following the 2008 Lehman Brothers crash and scared investors withdrew their money from equity market, gold prices started to soar, peaking in 2010 at over $1,800 per ounce. While the price has since moderated, it remains at around twice the 2007 level. 

The price hike was bad news for cash-strapped couples unable to afford wedding rings, but for mining companies it was a great opportunity to exploit deposits that had suddenly become economically viable. This included in areas like Southeast Europe, where gold has been mined since ancient times; the subterranean galleries of Rosia Montana are the largest known underground complex from the Roman empire. 

Amid the rise in gold prices, Turkish investors started eying Balkan mining wealth, while other companies such as Dundee Precious Metals in Bulgaria and Malaysia’s Glanz Investment in Bosnia have also made commitments to the region. 

At the same time, however, environmental campaigners stress the dangers of pollution from gold mining, especially from techniques using cyanide. The Baia Mare disaster in Romania has been a salutary tale for environmentalists across the region. In 2000, 100,000 cubic metres of cyanide-contaminated water burst through a dam near Baia Mare, contaminating large swathes of farmland and leaking into the Tisza and Danube rivers to affect Hungary and Serbia as well as Romania.