- Mr Burns, inform us, please, regarding Eldorado’s Gold presence in Greece which point of your business plan has been already reached and what critical issues remain unsolved?
We have invested approximately US$1.0 billion in Greece since 2012 in developing the Olympias and Skouries assets and currently have just over 2,200 employees in the country. We have spent in excess of US$100 million in reclamation and rehabilitation activities to address legacy environmental issues pertaining to previous operators of the Kassandra Mines in Halkidiki. The refurbished mill at Olympias is currently in commissioning and we expect commercial production by the end of 2017. At Skouries, we have been hampered by permitting delays, but the project is approximately 60% complete.
Capital invested in Greece has primarily paid our Greek employees and contractors in the form of wages, our suppliers of goods and services and the government in the form of taxes. This has been a tremendous boost to the Greek economy during a very difficult period for the country.
- Eldorado Gold Corporation has invested in Greece since 2012. What were the reasons for choosing Chalkidiki and what do you think are now the obstacles for progressing in your investment? Are there any responsibilities for delays in Greek government or in your company’s plan?
Chalkidiki has a long mining tradition dating back to the time of Alexander the Great. The prospectivity of the region, labour availability, and the quality of the current assets in Chalkidiki, all attracted the Company to the area.
The delays in obtaining regular, routine permits for our development projects is the major obstacle we are currently facing.
- Do you think there are any hidden incentives behind the present stalemate in your investment in Skouries and Olympiada?
The government of Greece has continually appealed to the global capital markets that it is open for business; however the continual delays in issuing routine permits, which is their contractual obligation, suggests otherwise.
- According to your engagement with the present Greek government insofar you would characterized the latter as hostile, friendly or neutral towards your investment?
We very much wish to develop a productive working relationship with the current Greek Government – this is our approach to operating in all jurisdictions. As a Canadian company with global operations, we share the same goals with Greek government, which is to develop mines responsibly, implement best available technologies and respect the local communities and environment.
- How you characterize the arbitration initiative of Greek government?
We understand that arbitration is a normal process in Greece for finding common ground between two parties. We hope that this is where this process ends up and we are able to move forward with this significant investment that will benefit the people of Greece.
- From a financial perspective, explain us the cost for Eldorado Gold from the successive delays in Greece? How many funds have been lost by the company and Greece as well?
There have been significant costs associated the constant and ongoing permitting delays. Unfortunately our lawyers have advised that we cannot be more specific than that at this time.
- Under present circumstances, what are the next steps for Eldorado’s management team in Greece? Are you thinking of getting out of your investment in Chalkidiki?
Eldorado Gold is committed to building both the Olympias and Skouries projects in Greece, but cannot continue to do so without the routine permits that are currently outstanding. Eldorado has a commitment to its shareholders to allocate their capital prudently. As such, Eldorado is currently evaluating its capital spend plans in the country.
- If mining runs smoothly what is your long-term business plan for Greece and explain us the benefits for the company and for Greece?
Currently the mineral sector represents approximately only 3% of Greece’s Gross Domestic Product (GDP). Given the Country’s rich mineral endowment, it is not hard to imagine the mineral sector of Greece at 7% of GDP if the right policies were implemented. This would represent a significant boost to the Greek economy in terms of investment, job creation, taxes to the government and export revenues.
If Hellas Gold and Thracean Gold, our two subsidiaries in Greece, were able to proceed according to plans, they would be among the largest employers and exporters in Greece, with approximately 3,000 direct employees and contractors. Export revenues could be approximately US$500 million per year depending on metal prices and taxes and royalties could be almost US$1 billion over the course of the mines’ lives.