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09. 04. 12. - 13:00

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09. 04. 12. - 13:00

Copper deal falls trough

Michael Leidig

The negotiations between the Ministry of Economy and the Canadian company Roman Copper for the privatisation of copper mining company Cupru Min failed irreversibly, the authorities announced yesterday (Sun).

According to a communiqué sent by the Ministry of Economy, the Canadian company turned down the conditions set up by the government regarding the payment of the contract in full (200.7 million Euros) and refused to observe the environment and transparency conditions set up by the Romanian side, local press informs.

The government will make sure the activity at Cupru Min will continue under the best conditions, the communiqué reads.

The authorities say they will resume the privatisation process in the upcoming period, according to the provisions included in the 3.5 billion Euros stand-by-agreement with the IMF, which provides the privatisation of several state-owned energy and mineral resources companies, including Cupru Min.

"The Romanian state needs serious and sound partners for the privatisation process," reads the communiqué.

The Economy Ministry published the contract’s clauses as soon as it dropped the deal with the Canadians. So far, the government refused to make public the contract despite numerous demands by the opposition and social activists.

According to sources close to the negotiations, the Canadian company refused to pay 32.2 million (mn) Euros to Cupru Min for environment preservation works. Roman Copper was also bound to pay within 30 days the 200.7 mn Euros after it got the Competition Council's clearance and the environment go ahead.

However, Roman Copper claims it has accepted all the terms of the contract and still considers the privatisation deal as valid and ongoing.

The representatives of the company declared on Saturday that they had a "verbal deal" with the government and from their point of view the selling of Cupru Min had not fallen through.

The sale of Cupru Min and its copper reserves at Rosia Poieni, evaluated between 6.5 bn and 14 bn Euros, according to new evaluations, stirred heated debates between the cabinet and the opposition.

Last Monday Prime Minister Mihai Razvan Ungureanu was saying the 200 mn Euros represent a good price, adding that the buyer, Canadian Roman Copper Corp would also pay the environment tax. Ungureanu lashed out at the co-president of the oppostion, the Social Democratic leader Victor Ponta, telling him to go back to school to learn the way in which the economy works.

Ponta rebuffed, accusing the cabinet of following foreign interests when it privatised the company for such a small price and announced it would introduce a censure motion.

According to press reports, the Canadian buyer, a company set up in 2011 especially to acquire Cupru Min, obtained through the privatisation contract access to one billion tons of copper, representing 60 per cent of the total national copper reserves.

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