The Age
Hungary to sue mining company over cyanide spill

Tuesday July 11 2000


BUDAPEST - Hungary announced today a claim of 29.37 billion forints ($A181.7 million) against an Australian mining company for a January cyanide spill that devastated its rivers.

Hungary wants compensation for the damage from Esmeralda Exploration Ltd, a Perth-based gold-mining company whose Aurul joint venture in Romania spilt some 100,000 tonnes of cyanide residue into the Somes and the Tisza rivers, officials here said.

From Hungary's Tisza, the pollution flowed into Europe's second-largest river the Danube, and finally into the Black Sea, across six countries. Hungary says the spill killed 1241 tonnes of fish in Hungary alone.

At the time one Hungarian official said the spill was the worst case of pollution in the region since the 1986 Chernobyl nuclear accident in neighboring Ukraine - a claim dismissed as exaggerated by both the Australian firm and Romanian authorities.

Hungary's government commissioner responsible for assessing the damage and clearing up the spill, Janos Goenczy, informed Esmeralda's lawyers about the claim today, his office said.

Esmeralda, which is currently under bankruptcy proceedings, shrugged off responsibility and claimed the damage had been exaggerated after the spill occurred as the wall of an open reservoir containing the poisonous substance broke in Romania in January.

"Hungary wants to enforce a claim of 29.37 billion forints during the bankruptcy procedure of Esmeralda," Goenczy's office said in a statement.

The claim includes Hungarian costs of averting immediate damage - including fishing out and getting rid of hundreds of tonnes of floating dead fish - damage assessment, long-term losses in the area's wildlife, expected rehabilitation costs and further economic disadvantage due to the damage, the statement said.

The claim was announced after top Esmeralda officials cancelled a visit last week claiming that talks between the governments of Hungary and Australia have not been closed, said Goenczy's spokesperson Eva Montsko.

Hungary has also been mulling a legal suit against the Romanian partner in the Aurul joint venture, as well as the Romanian state, for the damage, but so far has restricted its action to bilateral talks.

Hungarian private claims filed by small enterprises and lawyers are being separately collected, and have totalled about 4 million euro ($A6.46 million) so far.

Meanwhile, Hungarian Environment Minister Ferenc Ligetvari is due in Brussels on Thursday to brief European Environment Commissioner Margot Wallstroem on Hungary's moves so far on clearing up the Tisza River, the ministry said.



Original article