A subsidiary of Gabriel Resources Ltd., a Canadian company that wants to build Europe's biggest open-cast gold mine in Romania, is facing criminal court proceedings in that country.
A criminal prosecution against Rosia Montana Gold Corp. (RMGC) is being pursued by the prosecutor’s office near the Court of Appeal of Ploiesti, according to Gabriel Resources president and chief executive officer Jonathan Henry.
Whitehorse-based Gabriel Resources wants to build the mine on a 2,400-hectare site in the mining region of Rosia Montana, a group of villages located in the picturesque Western Carpathian Mountains (also known as the Apuseni) about 430 kilometres northwest of Bucharest.
The company proposes to use cyanide in the gold extraction process. Protests both for and against the mine plan have continued for more than a decade, and the government has not yet approved the project.
Henry told CBC News the Romanian prosecutor “has ordered the extension of the investigation and the commencement of criminal prosecution against all companies” that did business with a firm called Kadok.
“This case is about a company we purchased goods from being subject to criminal prosecution for money-laundering activities,” Henry said in an interview.
Rosia Montana Gold Corp. ordered approximately $300,000 worth of clothing from Kadok, according to Henry.
“I don’t have specifics of the particular type of clothing; I don’t think it is relevant,” he said, adding that the clothing is related to the mining company’s activities.
In a subsequent email, Henry explained: “We are one of over 40 companies, all legitimate businesses in Romania, that happened to do business with a group of companies that was not paying taxes to the Romanian state.“
The Ontario Securities Commission said it is not able to comment on any specific matters.
In an email, the regulator said “reporting issuers have to disclose material information and material changes to the market.”
Henry said Gabriel Resources has not been contacted by the Ontario Securities Commission as late as Thursday. He said Rosia Montana Gold Corp.will fully co-operate with the authorities.
“No employee of the company or member of its management team is targeted,” said Henry.