The Greek government is halting activity at Canadian company
Eldorado Gold Corp.'s (
TSX: T.ELD,
Stock Forum) mine operations in northern Greece because it has violated some terms, published reports said Wednesday.
“We are recalling the technical studies, which will result in the halting of operations at Skouries and part of operations at Olympiada. The company has violated some terms,” Greed Energy Minister Panos Skourletis told reporters Wednesday.
Skouries and Olympiada are both located on the Chalkidiki Peninsula in northern Greece. Chalkidiki is a polymetallic mine that is being redeveloped in phases.
Eldorado Gold shares fell 12% to $4.80 on Wednesday, leaving a market cap of $3.4 billion, based on 716.6 million shares outstanding. The 52-week range is $9.68 and $3.94.
Scotia Capital has estimated that Skouries accounts for about 28% of Eldorado’s net asset value. Production is expected to start in the first quarter of 2017, with output forecast at around 143,000 ounces annually.
Last week, the company said it had secured key permits related to forestry land, and site cleaning rights that will enable it to proceed with tailings pond construction at Skouries.
The company said in a press release that the Council of State, Greece’s Supreme Court on administrative and environmental matters had issued two court decisions that are related to the Skouries project, which is held by Eldorado’s Greek subsidiary.