-- 2012 saw Romania with four different governments under three different prime ministers. Intense domestic political infighting limited significantly the level of Government engagement on the Project. In May 2012 a parliamentary 'no confidence' vote opened the way for the USL, as the then political opposition, to form a new government. There were two national elections organized during the year; being local party elections in June and parliamentary elections in December. In addition, a national referendum was held in July to vote on the initiation of the process to remove the President from office, which fell short of the 50 percent turnout threshold required for the result to be legally binding, despite a significant majority voting for the President's dismissal.-- The local elections held on June 10, 2012 marked a significant victory for the USL, who not only gained control at most of the important city halls in Romania but also secured 36 out of 41 county council presidencies.-- On December 9, 2012, the parliamentary elections brought an overwhelming victory for USL, who gained two thirds of the parliamentary seats - a position enabling the USL to fully control both 'houses' (the Senate and the Chamber of Deputies) and to adopt important laws without the need for cross-party consensus. The new Parliament was invested on December 21, 2012. Victor Ponta retains his position as Prime Minister, albeit his cabinet has a slightly different structure with some of the former Ministries (including some relevant for the Project) being split and given different functional roles. This includes a new Ministry of Infrastructure Projects of National Interest and Foreign Investments to which, it has been reported by the Romanian national media, overall responsibility for approving the Project may be transferred.-- The permitting progress of the Project relies heavily on Government approval of the environmental permit ("EP") and the issuance, in accordance with due process and Romanian law, of various permits and approvals at local, county and federal levels of government. The USL Government has stated that it will analyze the 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. In particular, recent comments from both the Prime Minister and Minister for Environment reported in the Romanian media in 2013 on the status of permitting of the Project, have specifically focused on compliance with European Directives as key to its progression. The Company is confident that it can, and will, comply with its environmental obligations and looks forward to furthering discussions with the relevant Ministries on this topic.-- The Company's view is that the first half of 2013 will be an important barometer to determine where projects, such as that at Rosia Montana, which are significant to the economic progression of Romania, sit in the list of priorities for the new USL Government. The strong electoral mandate and parliamentary majority position that the Government now enjoys marks a departure from the past where coalitions have had to accommodate multiple political agendas. The Company views this apparent stability and strength of Government at the start of a four-year term, along with the establishment of a Ministry for Infrastructure and Foreign Investments, as a positive basis for engagement on the Project.-- On March 1, 2013, the United States Department of Commerce notified Gabriel of its decision to formally support the Company through the Commerce Department's Advocacy Center for International Trade, which coordinates US government resources and authority in support of international business opportunities that involve foreign government decision-makers. As part of such Advocacy assistance, Gabriel anticipates that the US government will assist the Company by communicating to the Romanian Government on behalf of Gabriel's commercial interest in Romania.-- The Company will continue to pursue a strategy of engagement with all stakeholders, to explain the critical importance of the Project as part of the sustained economic development for Romania, and its commitment to adhere to the highest standards on engineering, environmental, cultural and social matters.