Canadian - controlled gold mining company Rosia Montana Gold Corporation RMGC threatens to mass layoff most of its staff in Romania in May this year, if the gold mining project, still stuck on lack of approvals, does not go any further.

RMGC said it recently started procedures to lay off 400 employees in Romania, after repeated delays by the Romanian Government to address the assessment and  permitting of the Rosia Montana gold mining project. The 400 staff represent 80 percent of its workforce, said Canadian Gabriel Resources, majority shareholder in RMCG.

The company said it has given the Romanian workers redundancy notices, and “if there is no progress in the project, the contracts will be terminated as of May 1, 2014”.

“We still remain fully committed to building and operating a mine at Rosia Montana but we need to see a similar commitment from Romania. With no environmental permitting progress forthcoming, and following expenditure in Romania of USD 550 million over a fifteen year period, the company has recently had to give almost 400 Romanian employees notice of redundancy,” said Jonathan Henry, Gabriel’s President and Chief Executive Officer, quoted in the company’s report for the annual and fourth quarter results for 2013.

The gold mining project at Rosia Montana has triggered many controversies over the years, the use of cyanide and the landscape destruction brought by the project being the main concerns and reasons for criticism. Protests were staged all across Romania in autumn last year against the project.

A parliamentary commission tasked with revising the project rejected it in November last year. Also, in December, the Romanian Parliament rejected the new Mining Law which would have allowed the controversial gold mining project at Rosia Montana to start.

Irina Popescu, irina.popescu@romania-insider.com