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11 october 2002
bucharest, romania, washington dc
alburnus maior * cee bankwatch
network
friends of the earth international *
greenpeace cee
mineral policy center * miningwatch
canada
WORLD BANK REJECTS CONTROVERSIAL GOLD
MINE PROJECT
Community Leaders Call on Government and
Private Lenders to Oppose Rosia Montana
Mining Project
romanian activists and foei chair ricardo
navarro urge world bank
president wolfensohn not to finance the gold
mine (sept 2002)
Bucharest, Romania, and Washington, DC: 10
October 2002 - Today, the International
Finance Corporation (IFC), the World Bank's
private lending arm, announced that it would
not financially support the controversial
Rosia Montana gold mine project in Romania's
Apuseni mountains. The project had come under
fire from an international coalition of NGOs
based on flaws in the project proposal and
concerns about Gabriel Resources, the project
sponsor. In an official statement, the IFC
said that it had "concluded that it is in
everybody's best interest that we do not
pursue discussions with the company regarding
IFC's involvement in the [Rosia Montana]
project."
The Rosia Montana project, if realized,
would be Europe's largest open-cast gold
mining operation. Gabriel Resources' plan, in
order to be economically feasible, would
transform the valley of Rosia Montana, the
oldest documented settlement in Romania, into
four open-pit mines. The neighboring valley
of Corna would be converted into an unlined
cyanide storage 'pond' covering a surface of
up to 600 hectares, held back by a 180-meter
high dam. The pits would generate roughly
196.4 million tons of cyanide-laced waste.
The international coalition that opposed the
mine pointed to the disastrous experience at
the Baia Mare gold mine in Romania, where a
cyanide spill in 2000 polluted the Tisza and
Danube Rivers, contaminating the drinking
water supplies of 2.5 million people and
killing 1200 tons of fish.
In order to make way for this
mega-project, more than 2000 people would
have to be relocated. Many are subsistence
farmers who do not wish to leave their lands.
The IFC had projected that the mine would
employ a workforce of 250 to 300 people over
the mine's estimated lifespan of 15
years.
Toronto-based company Gabriel Resources
(registered in Barbados) had approached the
IFC for a loan rumored to be approximately
$250 million. The company has no previous
mining experience. According to Dundee
Securities, Gabriel Resource's founder and
chairman Frank Timis has two convictions for
possessing heroin with the intent to sell. An
earlier venture of Mr Timis, a Ukrainian
petrol company, had been barred from the
Toronto stock exchange. Gabriel Resources
(T.GBU) is currently listed on the Toronto
exchange.
In March this year, the mining company
started an aggressive relocation program, in
the absence of adequate public hearings or
any Environmental Impact Assessment (EIA)
studies. Toronto-based Planning Alliance is
responsible for the resettlement. Prior to
working with Gabriel Resources, it had been
involved with the controversial relocation of
20,000 people at the Gold Fields mine in
Tarkwa, Ghana.
The NGO coalition that opposes the project
welcomed the IFC's statement. Eugen David,
president of Alburnus Maior, the local
community group, said, "For well over two
years we have been confronted on a daily
basis with a psychological war to make way
for the project. Today marks an important
victory in our struggle to keep our land for
our children. We are overjoyed and
congratulate the IFC for its decision. We
hope that other financial insitutions and
banks will follow suit and pull out or
refrain from investing in this speculative,
unprofitable and unsustainable project that
will only increase pollution, poverty and
corruption."
Other members of the international
coalition include CEE Bankwatch Network,
Mineral Policy Center (Washington, DC),
Friends of the Earth International
(Amsterdam) and Greenpeace CEE (Vienna).
Jozsef Feiler of CEE Bankwatch Network
said, "The IFC's wise decision points out the
low investment quality and troubled nature of
the project as proposed by Gabriel Resources.
We hope that those investing in this inflated
project will take the IFC's judgment as a
signal to look for a feasible and profitable
alternative to this boondoggle." Payal Sampat
of Mineral Policy Center in Washington, DC
added: "This sends a powerful signal to all
lenders: reject projects that communities
have opposed. The World Bank and private
banks should apply this precedent to all
future lending decisions."
'Investing in this project would be
incompatible with the World Bank Group's
current Extractive Industries Review', said
Johan Frijns of Friends of the Earth
International. 'If the Bank sincerely wants
to draw lessons from the outcome of this
review process, it should not consider any
new mining or oil projects during this
time'.
The project was also heavily criticised by
a group of 83 Economics professors from
Romania's renowned ASE university as well as
by a host of international archaeologists who
are extremly worried about the project's
destructive impact on the area's unique Roman
mine galleries and other archaeological
treasures.
For more information visit
www.rosiamontana.org
or
contact:
Francoise Heidebroek, Alburnus Maior
(English) +40 7232 30790
Eugen David, Alburnus Maior (Romanian) +40
7402 80309
Joszef Feiler, CEE Bankwatch Network +36 30
436 5122 ·
Joan Kuyek, MiningWatch Canada +1 613 569
3439 ·
Payal Sampat, Mineral Policy Center +1 202
887 1872 x. 210
Johan Frijns, Friends of the Earth
International +31 20 622 1369
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