Archaeology and Preservation of Cultural Heritage
-- The Company has continued maintenance work on 160 houses located in the historical center of the village of Rosia Montana ("Protected Area"), with the aim of preventing their deterioration. During 2012, the restoration of sixteen of these houses was completed and these are now in use. While these village houses are not designated as historic, the restoration will contribute to maintaining the character of the village.-- RMGC, in partnership with the local council of Rosia Montana, initiated the restoration of two iconic houses (the old school house and former town hall) in the Protected Area, along with the rehabilitation of a number of houses, which will be used for tourism initiatives. Subject to internal fit out, which has been placed on hold, the primary restoration of the former town hall was completed during 2012. Work on the old school house advanced to the stage of the building being secure and weather tight. Further restoration work has been put on hold until such time as the Government moves ahead with Project permitting.-- RMGC is continuing further archaeological work in the old underground mining galleries that lie under the Protected Area. This work has focused on opening up previously unexplored Roman galleries for public interest and will serve as a permanent museum, a visible testimony to the 2,000 year mining history at Rosia Montana. One such example is the Catalina Monulesti underground mining gallery which is in the process of being successfully restored and has been opened to the public. The Company has already hosted over one thousand visitors to the gallery, representing various stakeholder groups.
Corporate and Social Responsibility (CSR)
-- Gabriel takes pride in its commitment to achieving the highest levels of sustainability from workplace safety to community and environmental responsibility. It has a clear goal of attaining business performance through a dynamic process of continuous improvement in all aspects of its business and respecting all stakeholders. The Company invests significant resources into its CSR programs, which in Romania is a multi-dimensional commitment managed by RMGC covering employee training and safety, local communities, living traditions, direct and indirect social impacts, educational programs, environmental protection, community sponsorship and heritage aspects.-- One of RMGC's core commitments is to develop local employment, local supply and a strategy for local economy diversification during the life of the Project and beyond, evidenced through: -- Local employment - RMGC currently employs approximately 500 people directly and numerous others indirectly, with some 85 percent hired from the local community. The Company is investing in training and skills assessments for the construction phase of the Project; and -- Local supply - more than 600 local firms are suppliers / contractors to RMGC.
-- In November 2007 RMGC commenced an action to compel the Ministry of Environment ("MoE") to resume the EIA review, previously suspended. On June 19, 2012 the High Court of Cassation and Justice ordered that the file in respect of RMGC's original legal claim against the MoE should be returned to the Bucharest Court of Appeal to be reheard on its merits. At a hearing on January 14, 2013, the Bucharest Court of Appeal itself raised the question of whether the claim should be discontinued as a whole due to a lack of interest, based on the fact that the EIA review process had reconvened in September 2010. RMGC and the MoE informed the Court that they considered the action should be discontinued on such grounds and the Court admitted a motion of lack of interest. Accordingly, the actions against the MoE and its former officials have been discontinued.-- A case brought by RMGC to recover approximately 12.7 million RON (approximately $3.9m) in taxes, penalties and interest over the period January 2005 to June 2007 was resolved in RMGC's favor by the Bucharest Court of Appeal on May 10, 2011. The Romanian fiscal authorities submitted an appeal against this decision to the High Court of Cassation and Justice, an appeal which was irrevocably rejected by the High Court on March 13, 2013.-- Over the years certain foreign and domestically-funded non-governmental organizations ("NGOs") have initiated a multitude of legal challenges against licenses, permits, authorizations and approvals obtained for the exploration and development of the Project.-- The publicly stated objective of the NGOs in initiating and maintaining these legal challenges is to use the Romanian court system not only to delay as much as possible, but to ultimately stop the development of the Project. Often an action will be taken by the NGOs on a particular issue in several different regional court jurisdictions, and such legal objection may be raised in separate cases seeking a suspension or cancellation of a particular license, permit or approval, as is the situation with upcoming hearings for the first quarter 2013 summarized below. While a small number of these actions over many years have been successful, most have been, and continue to be proved to be, frivolous in the Romanian courts. Since early 2010 18 court decisions (from 19 legal challenges to permitting, licensing and other Project matters) have been positive for the progress of the Project.-- Cases concluded during the fourth quarter of 2012 included: -- A claim initiated by the Archaeological Restoration Association ("ARA") in the Alba Iulia Tribunal which sought to commence the procedure of classifying certain buildings from Rosia Montana as historical monuments was rejected at a hearing on February 3, 2012. This decision was appealed by the ARA, but such appeal was irrevocably rejected by the Alba Iulia Court of Appeal on October 3, 2012. -- An action commenced by two NGOs which sought the cancellation and suspension of UC-87 was dismissed by the Bucharest Tribunal on December 21, 2011. The NGOs appealed this decision, an appeal which was irrevocably rejected by the Bucharest Court of Appeal on October 15, 2012. -- An action initiated by two NGOs, which sought to compel the Alba County Authority for Culture and Patrimony and Minister of Culture and Patrimony to disclose the entire documentation submitted by RMGC in respect of the application for the Archaeological Discharge Certificate ("ADC") issued in July 2011 for the Carnic open-pit, was dismissed by the Bucharest Tribunal at a hearing on December 20, 2012.-- Upcoming hearings in the first quarter of 2013 include: -- A claim seeking the cancellation of the Strategic Environmental Assessment endorsement ("SEA") to the Industrial Area PUZ, which was issued by the Regional Agency for Environmental Protection of Sibiu in March 2011, is scheduled to be heard by the Cluj Tribunal on March 15, 2013. -- A request filed by three NGOs in the Cluj Tribunal seeking the cancellation of the ADC, issued in July 2011 for the Carnic open- pit, is scheduled to be heard on March 18, 2013. -- The next hearing of a claim by the same three NGOs in the Cluj Tribunal seeking the suspension of the ADC for the Carnic open-pit, is scheduled to be heard on April 5, 2013. -- An action before the Bucharest Tribunal, pursuant to which an NGO is seeking disclosure of certain documents pertaining to the Rosia Montana exploitation license, is scheduled to be heard on March 22, 2013. -- Two NGOs have also initiated proceedings before the Bucharest Tribunal seeking the cancellation and suspension of the ADC for the Carnic open-pit, the first hearing of which is scheduled for April 1, 2013.-- Due to the inherent uncertainties of the judicial process, the Company is unable to predict the ultimate outcome or impact, if any, with respect to matters challenged in the Romanian courts. In all circumstances, the Company and/or RMGC will vigorously maintain its legal rights and will continue to work with local, county and federal authorities to ensure the Project receives a fair and timely evaluation in accordance with Romanian and EU laws. However, there can be no assurance that the Company and/or RMGC will prevail in these matters. If any claims are not resolved in the Company's or RMGC's favor, then such a negative ruling may have a material adverse effect on the timing and/or outcome of the permitting process for the Project and the Company's financial condition. The implications of a negative court ruling will only be known once such a decision is issued and the position of the Government is assessed.