Wait in gold — delays to Romanian mining

Materials World magazine
1 May 2008

The Rosia Montana Gold Project in western Romania has received a lot of media attention over the last two years. The uproar centres on a mining project uncommon in Europe. It is world class, with projected processing of 13Mt of ore per year over 16 years, producing 10.1m ounces of gold and 47.6m ounces of silver.

Much of the public debate has been high profile attacks by non-governmetal organisations (NGOs), claiming to represent the local community and concerned environmentalists. A solitary defence has been put up by Gabriel Resources of Canada, the main project sponsor. The project is being developed by the Rosia Montana Gold Corporation (RMGC), where Gabriel is the principal shareholder, with the Romanian Government also owning a stake.

In the 2006 documentary film, Mine Your Own Business, inconsistencies were reported in the NGO’s message on ‘poor Romanian villagers oppressed by the foreign gold miner’. The project’s positive and negative impacts on life with or without the gold mine its jobs and associated investment have been debated. Much of this was conducted with little reference to the Environmental and Social Impact Assessment (ESIA) carried out by an independent Romanian and expatriate team for Gabriel/RMGC, which is strange because of its relevance to the debate. It is curious that the findings from eight years of monitoring, research and assessment by well-respected Romanian and international experts was ignored.

Rosia environmental assessment

The ESIA work dates back to pre-feasibility studies conducted by RMGC in 1999 with environmental screening and preliminary baseline investigations undertaken by a Romanian team. In August 2000, an international environmental consultancy was appointed to assist detailed environmental investigations as part of the first round of feasibility studies focusing on developing two main scenarios – 14Mtpa and 20Mtpa production levels. The focus was on designing a project that would be acceptable, according to technical, economic, environmental and social issue standards.

The work was brought forward for further evaluation between 2003-2005 – a project using a cyanidation route for treatment of the comminuted ore. At this time, the European Commission was finalising studies on regulating mining waste in Europe. Formulation of the Directive on Mining Wastes Management and its supporting best reference document was underway. This was important to Rosia Montana because one of the drivers for the new regulations was the Baia Mare cyanide pollution incident of 2000. It was acknowledged that this tailings spill would be used for direct comparisons, warranted or not.

Environmental studies, the preliminary findings, consultation with the community, and advice from experts therefore proved crucial in the project design. Many options were considered for the mining methods, pit scheduling and surface footprints, and the proposed processing routes were re-evaluated. Water management issues, including supply, storage and treatment were subject to several phases of examination, including re-evaluation to determine robustness due to climate change factors. Tailings treatment and storage were also put under scrutiny to exceed the standards developed through the new EU Directive, and fully address the concerns raised by Baia Mare.

Optimisation through economic, technical, environmental and social evaluation designed a project forecast to demonstrate these characteristics –

• Mining from four open pits with backfilling to provide effective rehabilitation.

• Adoption of a cyanide destruct system to reduce the residual cyanide level required under the new EU legislation.

• Implementation of a comprehensive water management system for the site and surroundings.

• Design of tailings and other impoundments to high safety standards, considering possible climate change factors.

• Creation of 1,200 jobs during construction and 600 jobs during operation, with a projected 5,500 indirect jobs as a spin-off.

• Establishment of a development foundation via a 100% grant to allow capture of the direct economic benefits of the project for long-term community gain, through sustainable local economic development.

• A designated protection zone to safeguard historic and archaeological remains, establish a museum, and continue sustainable management of the cultural heritage as a community asset through the foundation.

• Assurance that adequate funds are available for safe and secure project closure to avoid any dereliction and pollution.

As a result of the interaction between techno-economics and environmental assessment, the project design is effective and performs well according to the ESIA report. This received much adverse criticism from the NGOs when the report was submitted. How could the ESIA be independent if it presented such favourable findings, they asked.

Public consultation

The ESIA report was finalised in May 2006 and submitted to the Romanian Environment Ministry for public consultation and review. The report was achieved through a process agreed between RMGC, the Ministry and also the Hungarian authorities under the terms of the Espoo Convention on transboundary impact assessment.
A series of 14 public meetings were held in the project area and regional centres throughout Romania and in two locations in Hungary. In addition, the Ministry invited written submissions, which were sent to RMGC for formal response. Twelve thousand pages of written responses to all of the queries were then compiled by RMGC and submitted to the Environment Ministry. The effort put into the EIA process and consultation on this project is unprecedented in Romania.

A formal review of the ESIA report lies with the Ministry, but has been stalled due to legal action (challenged by RMGC). However, preliminary responses from technical and environmental experts in Romania and Hungary have been favourable and no significant finding of the ESIA has received a credible challenge.

Present day

In an Earthworks/Oxfam America report on dirty gold mining released in February (Golden Rules – Making the case for responsible mining), the NGOs appear to be repeating the same myths about the project. They claim that RMGC is breaking the golden rule – ensuring projects do not force communities off their lands. This does not refer to the ESIA documentation and appears to rely on the opinions of pressure groups criticised in the McAlleer film for looking after their own interests rather than the wellbeing of the local community.

The dirty gold report does not match the ESIA’s findings. Contrary to its argument, RMGC has purchased 77% of the property at Rosia Montana. This is in line with World Bank policy and Romanian legislation, and has been implemented according to a resettlement and relocation action plan as well as a community sustainablity development management plan.

The dirty gold report also fails to mention that the valley is currently highly polluted from 2,000 years of mining with no environmental controls, or that the project is forecast to be beneficial by installing the first comprehensive water management and treatment system.

The document also does not list the US$10m of archaeological and rescue work carried out, or mention the US$25m RMGC has set aside for the archaeology budget. Although an NGO accountability charter has been set up and signed by many organisations, there is nobody auditing the actions of NGOs against the charter.

The public meetings on the Rosia Montana ESIA report were well attended by local and international NGOs and raised many issues. All of these were either addressed in the ESIA report itself or by written answers to each question compiled by RMGC. One year later and the NGOs never refer to this evaluation process, they have only attempted to stop the ESIA evaluation.

It is up to the people of Romania to determine whether such projects should be permitted in their country. The current approach seems likely to circumvent processes that provide fair decision-making. The 450 RMGC local employees face redundancy and the community, already severely disadvantaged with 75% unemployment, faces a future that is highly uncertain.


Further information:

AMEC Earth & Environmental (UK) Ltd