TORONTO (Reuters) - Shares of Eldorado Gold rose as much as 14.6% on Monday on optimism that a snap poll called by Greece could result in the election of a new business-friendly party and help resolve permitting problems the miner has faced for years.
Greek Prime Minister Alexis Tsipras said he would call a snap vote following his party’s defeat in European Parliamentary elections to the opposition conservative New Democracy Party.
Eldorado shares were up 13.7% at C$4.74 in afternoon trade in Toronto, compared with a 0.3% decline in the benchmark S&P/TSX Global Gold Index. The stock earlier rose to the day’s high of C$4.78.
The Vancouver-based company has two operating mines and two development projects in Greece, and has struggled with permitting delays at its Skouries location for years, mainly over environmental regulations. The country accounts for 42% of Eldorado’s operating net asset value, according to Desjardins.
“A political shift to a more pro-business climate has potential positive implications for the company’s outlook in-country,” Josh Wolfson, an analyst at Desjardins, wrote in a note.
Eldorado halted construction in November 2017 at Skouries, which has reserves of 3.7 million ounces of gold and 1.7 billion pounds of copper, citing the delays.
The company said in September it would seek 750 million euros ($839.03 million) from the government for damages it said it had suffered due to the delays.
An Eldorado spokeswoman did not immediately respond to a request for comment.
Eldorado Chief Executive George Raymond Burns said on an analyst call in February that the company was “feeling fairly optimistic that the election process could bring about a significant change in sentiment.”
($1 = 0.8939 euros)
Reporting by Nichola Saminather in Toronto; Editing by Matthew Lewis