- Posted December 14, 2013 by
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Romania rejects general mining law: the end of the Rosia Montana project?
The Romanian parliament recently rejected a new general mining bill. The law was controversial, because it made mining exploitations much easier, as their commencement only required a governmental decision declaring them of outstanding public interest. The bill defined outstanding public interest projects as “mining projects whose economic and social benefits, obtained directly or indirectly by the state and/or local administration units, surpass the negative environmental consequences.”
The new law was accused of catering to the interests of a Canadian company, Gabriel Resources. For the past 15 years, it has been struggling to obtain the licenses needed to initiate an open-pit mining project at Rosia Montana, where it planned to use over 40 tonnes of cyanide a day to extract around 340 tonnes of gold. Informed by a special commission’s report on the project’s irregularities, Romanian parliamentarians had already rejected a governmental draft law approving the Canadian-led initiative. The commission had been created in response to mass protests against the Rosia Montana initiative, which have uninterruptedly taken place since September, bringing together hundreds of thousands of Romanians in cities across the country and abroad. The protesters decry the project’s devastating environmental, socio-economic and cultural consequences.
The Parliament’s decision to reject the general mining law does not mark the Canadian project’s end. The new law did not pass, because of the lack of quorum for what is considered an organic law. Had the quorum been met, the bill would have passed. The rejection not only suggests that the Romanian politicians will renew their efforts to create the legislative framework allowing the Canadian company to start exploitation next year, but that they continue to dismiss the protesters’ demands. Several politicians have already announced that a new mining law will be refiled and discussed during the next parliamentary session.
Claiming that the Canadian initiative is the only solution for the impoverished Rosia Montana region, both the company and the government seem determined to start the project, despite the Romanian public’s opposition. Gabriel Resources is pressurizing on the Romanian government to adopt the needed legal changes to start mining. The company had demanded the mining law in Romania that had just been rejected, threatening to otherwise do “something radically different” with its controversial project.
Gabriel Resources has yet to react to the most recent developments in Romania, but it certainly did not seem concerned with the commission’s report. In fact, it is preparing to start exploitation at the beginning of next year. In a press release responding to the special commission’s report, the Canadian company emphasized: “We look forward to the swift adoption of such a legislative framework so that the Rosia Montana project development can be initiated in early 2014 and to the positive impact of the restart of mining in Romania to which will boost the entire economy.” Moreover, its third-quarter financial report released on November 15 emphasized that it will cost around $1.5 billion to bring Rosia Montana into production and cash-flow positive, $100 million higher than its estimated $1.4 billion in October 2012.
Nevertheless, other actors, such as Europa Nostra, the lead¬ing European her¬it¬age organ¬iz¬a¬tion, consider that it would a positive news if the Canadian company left Rosia Montana, as the gold could be protected and the extremely valuable local patrimony could be valorized through sustainable development and ecotourism. In June 2013, the heritage organization selected Rosia Montana as one of the ‘7th most endangered landmarks’ in Europe, offering to assist Romania in developing an alternative development path for the region, focused on highlighting Rosia Montana min¬ing land¬scape, one of the most rep¬res¬ent¬at¬ive in Europe, exploited since Roman times, as it reveals Europe’s “shared past, anchor¬ing a sense of belong¬ing to a European fam¬ily.” According to an Oxford research paper, the Roman galleries, exploration chambers and drainage works at Rosia Montana are of “exceptional international interest and importance” and should be preserved in situ.
Europa Nostra suggested that Romania seek a partnership with the European Union (EU) to create a sustainable development plan for Rosia Montana. This proposal counters both the government and the Canadian company’s repeated argument that the mining project represents the only way to bring the region out of poverty. Similar, a group of international environmental organizations, which includes WWF-Danube Carpathian Program and Ecotourism Norway, signed a letter of support for ecotourism in Rosia Montana, by promoting ecotourist activities, including agricultural and related services.
The Rosia Montana campaign has demanded the complete ban of cyanide mining in Romania. This would follow the example of several European countries, including Germany and the Czech Republic, and would end the activities of companies as Gabriel Resources. Many politicians, including the Romanian Prime Minister Victor Ponta, have claimed that cyanide is the only way to exploit gold.
That is not accurate. Northwestern University researchers determined that cornstarch is an environmentally-friendly way of extracting gold. Moreover, in time, other technologies could be developed to extract the gold in a safe and environmentally-respectful manner.
Cyanide mining has been highly destructive, affecting countries from Ghana and Australia to Honduras. Romania has also experienced multiple destructive cyanide spills that have perturbed the Eastern European’s local economies, communities and the environment as well as those of Hungary and Serbia. Romanian politicians seem to have learned little from past mistakes, as they are getting ready to start a new mining law.
Natural resources are borrowed from future generations. It is an ethical responsibility to either preserve them or to ensure that they are extracted in the most environmentally-friendly and cost-effective way and that the benefits obtained from them, in the form of investments and savings, will adequately benefit our successors. In order to achieve these goals, good governance and economic expertise are imperative. Politicians that understand the gold market and gold price fluctuations can aptly negotiate the contents of contracts with gold mining companies, assign them responsibilities and ensure that it is not their personal gains, but their country’s best interests which prevail.
Unless these criteria are met, the state, instead of gaining revenue, might end up paying much more in post-exploitation environmental rehabilitation. Romania has already been in this situation. In the 2000 Baia Mare cyanide spill, considered the worst environmental disaster in Europe after Chernobyl, Romania was unable to ensure the environmental cleanup for its own citizens and pay the damages demanded by its affected neighbors, Hungary and Serbia, after the Australian company involved in the mining operations refused to assume responsibility for the accident. The company was not even forced to pay compensation for the damage caused.
Beyond the Rosia Montana cases of the world, a more systemic and profound change needs to come in the form of a societal reevaluation of gold’s value. Objects are intrinsically valueless until ascribed worth. Gold is a metal that has been coined as ‘precious’ and assigned tremendous importance. However, at this point, gold extraction has cost countless communities across the global their identity, even their very existence, killed local economies and mutilated the environment. People must realize that their golden jewelry is forged out of the suffering and exploitation of other people and the environment. Once these atrocities are fully grasped, the precious metal’s sparkle instantly turns to rust.