Eldorado Gold pulls all investment from Greece mining operations

A global gold exploration company has announced plans to withdraw all investment and suspend its operations in Greece, following governmental conflict.

Eldorado Gold, which has significant operations in both gold and silver in both Turkey and in Greece, announced earlier this week that it plans to suspend investment at its operating mines, development projects and exploration assets in Greece.

The news comes in light of recent failed attempts to “engage constructively” with the Greek government, the Ministry of Energy and Environment, and other government agencies, delays continue in issuing routine permits and licences for the construction of two of its flagship projects in Greece.

In a statement, the company noted that the permitting delays have “negatively impacted Eldorado’s project schedules and costs,” and has prevented the company from developing the Skouries and Olympias projects in Halkidiki, northern Greece.

With the exception of a care and maintenance program and necessary environmental safeguarding costs, Eldorado and its Board of Directors have decided that under present conditions no additional investment will be made into the Kassandra Mines (Olympias, Skouries, Stratoni) in Halkidiki, the Perama Hill and Sapes projects in Thrace, and any exploration activity in the country.

Eldorado estimates that a total of US$30 million will be spent to prepare for care and maintenance activities, with sustaining maintenance costs of approximately US$25 million annually.

George Burns, President and Chief Executive Officer of Eldorado Gold, commented:

"It is extremely unfortunate to find ourselves at this impasse when we should be advancing an important commercial project in partnership with Greece and adding another 1,200 jobs to our current workforce of approximately 2,400 people in Greece.  Eldorado's investment in Greece is about building a world-class operation that can exist as a long-term partner to Greece and has the ability to promote advanced skills and training for its people and deliver well-paying jobs to sustain families and local businesses.  Of equal importance, as a commercial partner, this business can provide much-needed tax and export revenue for generations."

"Eldorado has been a committed, responsible and patient partner to the Greek government and the people of Greece.  Since acquiring the Kassandra Mines for nearly $2 billion in 2012, Eldorado has invested an additional $1 billion in the country.  That figure would double if Eldorado were able to fully develop its Olympias, Skouries and Perama Hill assets.  However, as a result of the delay in issuing permits by the Greek government, Eldorado is unable to continue investing in the country.”

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Skouries Project (Halkidiki)

Construction and development activities at the Skouries project, with over $350 million invested to-date and a current workforce of 530 people including contractors, will be suspended effective September 22, 2017.

Olympias Project (Halkidiki)

The refurbished Olympias processing plant is close to completing the commissioning phase and commercial production from Phase 2 was planned during the fourth quarter 2017.  Current headcount at Olympias is approximately 950 people including contractors.  Commissioning work and further development activity will be suspended effective September 22, 2017.  To date, Eldorado has invested over $400 million at Olympias.

Stratoni Mine (Halkidiki)

The Stratoni Mine currently employs approximately 830 people including contractors and had a life of mine of approximately one year based on known proven and probable reserves at the beginning of 2017.  Geological potential exists to expand resources and extend mine life and Eldorado is currently undertaking a drilling campaign to test the lower portion of the Mavres Petres orebody.  Additional investment would be required over the next two years to further delineate additional resources. All mining operations and exploration activities will be suspended effective September 22, 2017.

Perama Hill and Sapes Projects (Thrace)

Perama Hill and Sapes are currently on care and maintenance pending approvals by the Ministry of Energy and the Environment for Perama Hill's Environmental Impact Study and for Sapes's drilling permit, both of which have been pending for over three years.