Mining firm Martern, a subsidiary of Canada's EurOmax Resources Ltd, has announced the discovery of "abundant" coarse gold at a site in Bulgaria, a find that the company described as the most significant new gold discovery in the country in the past century.

"There will be much more gold discovered in Bulgaria," Martern chief executive John Menzies told a news conference in Sofia on August 22.

However, it would take years before the amount of gold that could be mined may be determined with accuracy.

The company made the announcement amid its tussle with Environment and Water Affairs Minister Djevdet Chakurov, who has called for the state to change the rules to get a bigger share of revenue from Bulgaria's gold deposits, with environmental organisations that oppose exploration and mining, and with the Bulgarian mining chamber, that said in recent days that exploration during the communist era had found all the gold that there was to find in Bulgaria.

Martern has been frustrated by the militant campaign by organisations such as Green Balkans, and by ministerial foot-dragging about granting permission to go ahead with its projects.

Having clearly decided that silence is not golden, EurOmax announced on August 17 that it was taking court action against Kostantin Dichev, a member of the supervising board of Green Balkans, for "numerous statements against the company and Menzies which are incorrect, causing damage to reputation and financial loss".

EurOmax said that it believed that Dichev and Green Balkans had been closely involved in the protest that had stopped Martern from completing its contractual obligations with the Bulgarian government at Popintsi.

In early August, EurOmax announced that it was temporarily withdrawing from the Petelovo Hill site at its Popintsi licence, to which protesters had blocked access. The company said that it was doing so as a "social act" to avoid confrontation and as an invitation to reasonable and democratic dialogue.

Martern said that it would defend its interests in court and if the administration failed to produce satisfactory results, the company would take the matter to international court.

Martern is seeking compensation from Dichev of a nominal one lev, "but reserves the right to increase this amount". Cited in the action are statements made by Dichev, quoted in a Bulgarian-language newspaper on August 1.

At the August 22 news conference, Menzies said that the discovery of what was "more than most of our geological team have ever seen in a gold outcrop" had been made at a gold outcrop at the Trun site in western Bulgaria. The site is being prospected by EurOmax and Canadian giant Teck Cominco. Menzies described the discovery as being of very high grade gold.

The discovery had been made possible through the use of modern technology, which had now been made available to a Bulgarian laboratory involved in the exploration.
He hit out at the Bulgarian mining chamber for its claim that no further exploration for gold in Bulgaria was required. "We don't understand how experts in the field vocalised such comments."

He asked who would benefit if mining went ahead without further exploration. Underestimating the resource grade would benefit whoever used them. "Clearly, there would not be a benefit to the state," Menzies said.

Menzies criticised the Government for its lack of support, for the fact that no Cabinet minister had repudiated Chakurov's statements about changing the contracts with EurOmax and Dundee (for more on Dundee, please see page 5) so that the state had a greater share, and at Chakurov, to whom a letter had been sent a week previously requesting a meeting, without there being a response.

Menzies said that the Government was wholly unresponsive and seemed to have no interest in creating a good investment environment in Bulgaria.

"What we need is discussion. We need dialogue about gold and we just don't get it." This affected not only his company but also many other investors, he said.

Should the obstacles to his company's operations be removed, there would be manifold benefits, in the creation of jobs at good salaries, in revenue earnings and in benefits for local communities.

Menzies said that the company was at the earliest stages of exploration, and it would take years of effort, employment and millions of dollars before the potential of the resources could be known.

"This could be a significant part of the Bulgarian economy," he said.

Earlier, Chakurov said that the concession compensapaid to the state was too low, and he called for creation of joint ventures between investors and the state, or the revocation of existing contracts.

His statements led to a storm of media controversy, with Bulgarian-language weekly Kapital saying that Chakurov's "intention to dissolve contracts that have already been legally signed can in fact be considered as nothing other than racketeering the companies which for months and months have been facing all kinds of obstacles in Bulgaria and despite that, they keep defending their rights by the current legislation in force". An August 1 article in Monitor said Chakurov's proposal amounted to "unilateral breach of contract".