The action relates to the company’s dispute with Romania over the development of the Rosia Montana gold and silver mining project, of which Gabriel holds an indirect 80.69% interest, and violations by the government of Romania of the protections afforded by the international treaties for the promotion and reciprocal protection of involvements, which Romania has with Canada and the UK.
The project was, and still is, considered inside and outside Romania as one of the most important foreign direct investments in the country, with the potential to provide both a significant boost to the Romanian economy as a whole and to stimulate growth and development of the Apuseni region, which was a mining district for many centuries.
The company has always been firmly committed to the development of the project. Gabriel remains certain that construction of the mine using state-of-the-art technology would demonstrate the extensive benefits of the Project including, importantly, for the environment and for preservation of Romania’s cultural heritage, the company said in its statement.
“However, through its actions and inaction, Romania has blocked and prevented implementation of the project without due process and without compensation, effectively depriving Gabriel entirely of the value of its investments. Romania thus has subjected Gabriel and its investments to treatment in breach of Romania’s bilateral investment treaty obligations, causing significant losses to Gabriel,” the company said.
In the arbitration request, Gabriel seeks the full relief owed to it under the provisions of the treaties for the deprivation of its rights to develop the project as a consequence of Romania’s treaty violations.
Arbitration proceedings were launched following the issue of a written dispute notice the Canadian company addressed to the president, prime minster and the government of Romania, on January 20, 2015, seeking formal engagement to find an amicable resolution.
“Despite further letters of request for consultation sent by the company in April and May 2015, the Romanian authorities have failed to reply to any of the correspondence,” Gabriel said.
Gabriel continues to seek engagement at a senior level with the Romanian authorities in order to resolve the issues at dispute, however, Gabriel is also fully committed to the protection of its rights and interests in Romania and, in the absence of any willingness by the Romanian authorities to engage in dialogue, the company has been left with no alternative but to seek legal recourse through the arbitration.
“The company still believes the interests of all stakeholders in the project, particularly the Romanian state, would be served best by its permitting and development and Gabriel continues to be available to engage with the Romanian President and Government in order to achieve this objective. Whether this becomes a reality or not falls wholly on Romania’s political decision makers to demonstrate a commitment to the project and to the mining industry in general,” said Jonathan Henry, president and CEO of Gabriel Resources.
Gabriel has engaged White & Case LLP to advise it in this matter.
Gabriel held $32.1 million of cash and cash equivalents on June 30, 2015.