Whilst in opposition to the then liberal government, current Romanian Prime Minister Victor Ponta and his Social Liberal Union (USL), an alliance of several political parties, vehemently protested against the Rosia Montana mining project, which was supported by President Traian Basescu and his Democratic Liberal Party (PDL). According to Gabriel Resources Ltd., the Canadian company behind the scheme, the plan for the project is to dig up the estimated 800-4,000 tons of gold squirreled away in Rosia Montana using an astonishing amount of 40 tons of cyanide per day.
Gold cyanidation is a highly controversial practice used to leach gold from extracted material that has been banned in various countries as a result of the fact that even small amounts of cyanide are poisonous for the environment and human health. The enormous daily quantity of cyanide to be used during the Rosia Montana mining project would therefore produce a gruesome and irreversible environmental destruction in area. Exploiting the mine would mean destroying four forested mountains, contaminating multiple rivers, devastating several fragile ecosystems and destroying over 900 buildings. It would also require the damming up of one end of the Corna valley to hold 250 million tons of cyanide-laced waste generated by the gold leaching.
On the 5th of September 2011, in a blog post entitled “Rosia Montana-USL’s position,” the then opposition leader Ponta shared 7 key points why the Coalition was against the Canadian project in its proposed format and called for additional safeguards. These included the needs to make public and transparent the clauses of the agreement signed with RMGC, to respect the right to property and ensure that no one gets expropriated in Rosia Montana, and the need to conduct an independent analysis of the project’s overall costs and benefits for Romania. Ponta explicitly stated in his blog post that Gabriel Resources had “spread erroneous and constantly changing public messages” and that President Basescu had also misinformed the population about the mining project.
Since gaining power, the Prime Minister and USL have radically changed their position. At the present moment, Prime Minister Ponta and his fellow USL members seem to be even more willing than the previous government to bend the law of Romania, including on many of the issues that they once considered inviolable, in order ensure the project goes ahead.
Dominating in the Parliament and presiding over the government, USL has taken multiple measures to demonstrate its lack of political consistency on the matter. The first sign after the election that the new USL government intended to pursue the Rosia Montana project was its decision to divide up Minvest SA Deva, a state-owned company specializing in mining, extraction, processing, and export of gold-silver and copper, and create a new part, called Minvest Rosia Montana. This new company was established to handle the Rosia Montana project and manage its afferent patrimony – consisting of the company’s package of shares in the mining project and the liabilities resulting from loans it has taken in order to participate in the project.
The Romanian state will be a direct shareholder in the newly-created company, through the Department for infrastructure projects and foreign investment. However, Gabriel Resources would obtain 80 percent of the profits, with the Romanian government getting only 20 percent. Rosia Montana is the largest known gold deposit in Europe and the third largest in the world. Its value is estimated to be around at around $20.8 billion, representing a huge possible endowment for Romania but one the country is likely to see little of. Even if Minvest Rosia Montana starts renegotiating the profit percentage, it is unlikely that the Canadian company, which has to satisfy its stakeholders, will be willing to allow the Romanian government a substantially larger share of the profit.
In addition, according to the Bucharest Academy of Economic Studies, after the environmental clean-up costs and the repayment of loans taken out by Minvest from Gabriel Resources, the project would generate nowhere near the $4 billion claimed by RMGC, but instead bring “nothing to the region but a long term sentence to poverty.” This conclusion dismantles the myth that the mining project would bring economic benefits, much hailed by both the company and the Romanian government. Simply put, Romania has nothing to gain from this project. The country would effectively just be offering its highly valuable gold resources in exchange for hundreds of thousands of tons of cyanide, which would destroy one of its most beautiful and ecologically diverse regions forever and transform it into a toxic wasteland.
Apart from creating Minvest Rosia Montana, the Romanian government has not released any public information about its intentions at Rosia Montana since the beginning of 2013, maintaining the same level of secrecy as the previous government, which it once so ardently criticized. For instance, the Committee for Technical Analysis, responsible for assessing the environmental impact of the Canadian project, restarted its operations in April 2013 for the first time since November 2011 but the Ministry of the Environment failed to publicly announce this development. The information only became available because Gabriel Resources published the information in a report for its investors. Furthermore, Gabriel Resources recently announced that, on April 22, 2013, it had obtained a new planning certificate for the project, which the Romanian government has also failed to disclose.
Similarly, the Romanian government has apparently demanded additional financial guarantees from the company for the post-exploitation environmental restoration process in order to demonstrate their conformity to existing EU standards, but has not made any information on these demands available to the general public. Even if these unknown guarantees were to be accepted, however, restoration is but a euphemism in this case given the fact that the environmental damage caused to the Rosia Montana region would be irreversible. It would be impossible to restore the four mountains that its operations would destroy, purify the cyanide contaminated-rivers or revive the biodiversity destroyed in the long-term exploitation process. It would appear, therefore, that the demand for additional financial guarantees is more a ploy to convince the Romanian general public of the good intentions of Gabriel Resources – and thus persuade them that it should be allowed to start mining – than a trustworthy pledge for Rosia Montana’s rehabilitation.
There are other, equally concerning, signs of the government’s plans for Rosia Montana. The Romanian Parliament, also dominated by USL, is currently debating the modification of the 2003 Mining Law and considering amendments which would facilitate important erosion of citizens’ rights, particularly by allowing foreign companies to expropriate the lands and houses of Romanian citizens on behalf of the Romanian government. This clause goes against article 44(3) of the Romanian Constitution. This law would also facilitate the approval of other mining projects, including dangerous cyanide-based ones, like the RMGC-led one, by depriving citizens of their right to protest by remaining on their lands.
With the Romanian government seemingly rushing to start the project, the Canadian company is also increasingly impatient to get it going, after waiting for 16 years. So far, Gabriel Resources has spent more than $400 million, but has been constantly thwarted by the mentioned environmental concerns over its use of cyanide. However, it has been encouraged to be patient in its pursuit of the initiative by the fact that successive Romanian governments have indicated that they are happy to accept “its 19th century colonial operations, compared to […] modern gold mines” and are willing to tolerate the concomitant risks of contamination and environmental damage, deemed “alarming” by Victor Bostinaru, a member of the European Parliament.
While both the current and previous Romanian governments do not seem to mind their country being ripped off, the Romanian public has expressed its vehement opposition to the project. The Rosia Montana protest movement has grown to be the largest in Romania since the fall of Communism, taking place at the local, national and international level. During the January-February 2012 protests organized throughout the country, many Romanian protesters demanded that the Rosia Montana project be ceased. Moreover, in December 2012, the wide majority of residents of Alba, where Rosia Montana is situated, made a conscious decision to boycott a local referendum regarding the resumption of mining in the Apuseni Mountains and the gold mining exploitation at Rosia Montana. This implies that they do not want the Rosia Montana project to commence or mining in the Apuseni to be conducted under current circumstances.
The opponents of the Rosia Montana project are leading a historic battle that will play a decisive role in shaping not only the prospects for Romania and the extraction of its natural resources, but of all countries’ relations with international corporations and the future of international mining. In the context of the overwhelming general public and civil society opposition and its 2011 own position on the Rosia Montana project, the current government must desist from its plans for Rosia Montana. Its members should remember that they are only in power as a result of the discontent of the population with the previous government, on issues that included Rosia Montana, and that they can be removed as well, if they fail in their duty to govern according to their mandate.
Raluca Besliu is a Masters student in Refugees and Forced Migration Studies at Oxford.