Eldorado Gold plans to build mines in Greece not likely to happen before May

Eldorado Gold plans to build gold mines in Greece not likely to happen before May

Protesters ask authorities to ban gold mining in the Halkidiki region. Photo from archives, 2013.

Canada’s Eldorado Gold Corp (TSX:ELD) (NYSE:EGO) said Thursday it doesn’t see its Perama Hill project in Greece to get approval before local elections scheduled for May.

Delivering its 2013 results, the firm said it has reduced capital spending in the project to $25 million, it now expects to begin construction at Perama in late 2014, as opposed to the previously announced July deadline.

Last year the Vancouver-based company mined 721,201 ounces of gold, which represents a 10% increase over 2012 with average cash costs of $494 per ounce.

CEO Paul N. Wright said expected output for this year is between 730,000-800,000 ounce, or 6% more than in 2013.

Recurrent protests

When referring to its larger Skouries project, also in northern Greece, Eldorado Gold said it is set to continue “in full development mode” this year.

The proposed mine has had locals divided since early 2011, when Eldorado Gold’s subsidiary Hellenic Gold received government approval to mine in the northern peninsula.

Some claim the mine will harm tourism and release toxic substances, while others believe the operation is good news for Greece because it will generate new jobs and bring hundreds of millions into the struggling economy.

Local activists said they are concerned for residents' livelihoods as the region where the Canadian miner is planning to open two new mines largely depends on income from tourism, fishing, farming and beekeeping.

"A total of 3,000 hectares of forest has to be cleared for the Skouries mine," Jannis Verginis of the Coordinating Committee of Associations of Stageira-Akanthos Against Gold Mining told Deutsche Welle. "It's pristine forest – and most of it has already been cut."

Eldorado has, however, stated that only 180 hectares will be removed, vowing to replant the Skouries site afterwards.

Based on data posted on the company’s s website, the Skouries mine is expected to open by 2016 and will have a mining life of 27 years.

Eldorado also has mines and projects in Turkey, Romania, China and Brazil.