The Globe and Mail reports in its Thursday, Sept. 12, edition that some investors see an opportunity
in Gabriel Resources
after the shares slumped to
record lows at the start of the
week. The Globe's David Berman writes that some investors still hope Gabriel will
either get its Romanian gold
mine going, or that it will successfully
sue the Romanian government
for killing the project.
Either way, investors are being
too optimistic, says Mr. Berman.
Gabriel has been trying
to develop the Rosia Montana
mine over the past decade but
has been running into opposition
within Romania, largely related
to what the mine will do to the
environment and the local village.
This opposition looks set to kill
the project -- a particularly painful
scenario for the company, given
that it is not exactly diversified.
It has no revenues and operates
only in Romania.
Gabriel is not backing
down. It is threatening to sue the
government for $4-billion (U.S.),
citing what it sees as "multiple
breaches of international investment
treaties." It apparently
has some big backers, but Gabriel also faces skepticism
over the the mine's viability,
making the political drama look
like a sideshow to its future.
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