Dundee Wins Key Court Battle over Bulgarian Gold Project

Industry | January 27, 2012, Friday // 12:49|  views

The area below the prominent Ada Tepe hill is expected to have a mine life of nine years assuming an annual operating rate of 850,000 tonnes ore and 31% internal rate of return. Photo by capital.bg

Bulgaria's top court has confirmed the rights of a subsidiary of Dundee Precious Metals Inc. over the controversial Krumovgrad gold mining concession for a 30-year period, the Toronto-based miner said.

The ruling by the five-member panel of the Supreme Administrative Court confirmed an earlier ruling of a three member panel in a dispute, which involved DPM subsidiary Balkan Mineral and Mining EAD.

The ruling is final and is not subject to appeal.

According to the court the appeals filed were inadmissible as the parties involved had no legal interest in the proceedings.

"We are extremely pleased with the findings of the court," Dundee president and CEO Jonathan Goodman said in a release.

"The resolution of the concession appeal is another step forward in the development of the Krumovgrad gold project, which we expect to prove beneficial to the local community and Bulgaria, as well as the stakeholders of the company."

The project, which faces fierce opposition by the local community, was given at the end of last year a provisional go-ahead by the Bulgarian environment minister, who approved the company's environmental impact assessment (EIA).

This allows the Canadian company to proceed with the permitting process for the construction of the process plant, the integrated mine waste facility and the open pit mine.

Mining activities however cannot begin until the EIA appeal is resolved and Dundee says it is awaiting notification of a hearing date.

The people from the poor town of Krumovgrad and the nearby villages in the picturesque Rhodope mountains, predominantly ethnic Turks and Pomaks, are worried that the planned waste facility would be just one kilometer away from the town and one kilometer away from the river.

The Bulgarian cabinet gave on a 30-year concession the gold mine near the town of Krumovgrad to Dundee Precious Metals in February last year.

The gold mine is located in the Krumovgrad municipality on lands of the villages of Guliya, Dazhdovnik, Zvanarka, Kaklitsa, Malko Kamnyane, Ovchari and Sarnak.

The Toronto-based mining company has repeatedly assured that Krumovgrad gold project will be beneficial for Bulgaria and the local community.

Under mounting public pressure the Canadian company was forced to abandon plans for using cyanide technology after a Bulgarian court ruled against the cyanide gold extraction at the other mine operated by one Dundee's subsidiaries in the country, Chelopech Mining.

The company has committed to invest USD 130 M in the project.

Dundee Precious Metals' investments the open-pit gold mine will pay back in just a little more than three years, the company's final feasibility study shows.

The area below the prominent Ada Tepe hill is expected to have a mine life of nine years, assuming an annual operating rate of 850,000 tonnes ore and 31% internal rate of return.

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Tags: Canadian, toronto, canada, Bulgarian cabinet, concession, Dundee Precious Metals, Chelopech, Chelopech gold mine, Chepelare, Krumovgrad, mining, concession, Alex Nestor, environmental assessment, Chelopech Mining, Balkan Minerals and Mining, Krumovgrad gold mine, Namibia, cyanide, gold, Bulgaria, Bulgarian


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