Foreign gold mine reopens in Vietnam, pledges to clear debts

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Quang Nam locals gather in front of Phuoc Son gold company to demand money owed to them by the firm December 26. Photo by Trong Y

A Canadian-Australian joint venture gold mine in Quang Nam Province reopened Friday and pledged to start repaying its debts of more than US$10 million to local authorities and creditors.

Dinh Van Thu, vice chairman of Quang Nam Province, said Phuoc Son Company in the province's Phuoc Son District has resumed normal operations and district authorities will be working with the company to carry out the payments starting this week.

The company associated with the Besra gold production company shut down Thursday evening after more than 200 creditors surrounded its gate the whole day, demanding their dues that were at least a month late.

It owed VND190 billion in mining royalties to province authorities and VND30 billion to locals, ranging from small food vendors to owners of hotels where it hosted its visiting engineers, and those contributing funds to its main contractor Quang An Company.

Thu said the company has promised to clear the debts by the Lunar New Year, the country's biggest holiday, which falls January 31 this year.

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It will pay Quang An Company VND1.5 billion a month.

A source from Phuoc Son Company said the firm had been caught in various financial and production problems -- including dropping gold prices (a 35 percent decrease this year), increasing mining royalty rates, and tropical storms causing erosion and forcing it to close the other gold mine in the province, Bong Mieu in Phu Ninh District.

Bong Mieu was the company's first mine in Vietnam, opened in 1993 and followed by Phuoc Son five years later.

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