“The company is currently reviewing all areas of expenditure with a view to reducing monthly costs substantially until such time as the new Government moves ahead with project permitting,” reads the report.
Gabriel Resources’ losses doubled to 2.6 million Canadian dollars (EUR2 million) in the first quarter of 2012, from 1.1 million Canadian dollars in the same interval a year ago.
The net loss for the first quarter mainly reflects stock based compensation and corporate costs of $2.9 million, reads the report
At the end of March, Gabriel Resources registered cash and cash equivalents of 118.5 million Canadian dollars (EUR91 million), compared to about 135 million Canadian dollars at the end of last year and some 40 million Canadian dollars at the end of March 2011.
The Romanian political landscape changed significantly at the end of the first quarter when the Government led by Mihai Ungureanu was toppled in a no-confidence vote, reads the report.
According to the company, the governing program of the new Cabinet states it will re-analyze the Rosia Montana gold mining project “in a transparent manner and based on an open and democratic dialogue, so that the decisions are in accordance with the national interest, environmental protection and European legislation.”
“We continue to closely monitor the current political situation in Romania and will engage with the new Government as soon as it is willing, so that we are able to provide the market with an update on how recent developments will affect the timeline of the Project. (…) In the meantime we continue our campaign to highlight the substantial economic, social and environmental benefits of the project, not only for the company and its shareholders, but also for Romania itself,” said Jonathan Henry, President and CEO of Gabriel Resources.
Rosia Montana Gold Corporation (RMGC), a joint venture consisting of Gabriel Resources and the Romanian state, is developing the mining project at Rosia Montana, in the Apuseni Mountains. The deposit is estimated to contain around 300 tons of gold and 1,600 tons of silver.
Gabriel Resources owns 80.46% of RMGC, while the Romanian state (19.31%), through Minvest Deva, and other shareholders control the rest.
Billionaires John Paulson, Beny Steinmetz and Thomas Kaplan are some of the significant names behind Gabriel Resources.
(The sums are computed by MEDIAFAX using an exchange rate of EUR0.7692 for a Canadian dollar)