VANCOUVER (miningweekly.com) – Vancouver-headquartered Eldorado Gold said on Thursday its Greek subsidiary Hellas Gold has finally received a formal notice from the country’s Ministry of Finance and the Ministry of Environment and Energy initiating domestic arbitration.

The mediation will take place under the provisions contained in a contract between the Greek State and Hellas.

Eldorado said the ministries had named their nominee to the three-person arbitral panel, with Eldorado expected to nominate its representative in due course.

The arbitration hinges on the technical study Eldorado had completed for the Madem Lakkos metallurgical plant for treating Olympias and Skouries concentrates in the Stratoni Valley, submitted in December 2014, which Greece alleges is deficient and thereby in violation of the transfer contract and the environmental terms of the project.

Eldorado disputes this, saying it is “highly confident” that the subject technical study is robust and consistent with the transfer contract, the business plan and the approved environmental terms of the project.

"Despite the Greek government's refusal to engage with Eldorado, we believe that this matter could still be resolved through good faith negotiations. We again invite the ministry to engage with us for such purposes,” stated president and CEO George Burns in a news release, adding that Eldorado would “vigorously defend" its rights and "employ all legal means" at its disposal.

"Upon approval and receipt of all the required permits and a government that engages in good faith with the company, we will then be in a position to re-assess our investment options in Greece."

On Wednesday, Eldorado received two permits for its Olympias project, but noted that it was awaiting permits for the technical study for the old Olympias mine closure and the installation permits for the paste plants at Olympias, as well as the amended electromechanical installation permit for the Skouries flotation plant. It is also waiting to hear on other matters including, but not limited to, the relocation of antiquities at the Skouries site.

On Monday, Eldorado threatened that it would halt new investment in its Stratoni mine and Olympias and Skouries projects from September 22, citing long permit delays and a lack of clarity on an arbitration process that Greece announced in June to settle differences over mine development. This threatens about 2 400 jobs.

Eldorado’s struggle in Greece has been viewed as a test of the Greek government to attract foreign investment, since is debt crisis started about seven years ago.

The Greek economy has shrunk by more than 25% since Europe’s sovereign debt crisis began in 2008. Since 2010, the country has been under bailout programmes with stringent belt-tightening requirements. It has been working on attracting investments like Eldorado’s – the largest single foreign investor in the country at present – to end the bailouts and tackle high unemployment rates.

However, differences with the country, especially over compliance with environmental regulations, have dragged on – at times very publicly – for years, forcing Eldorado in January 2016 to amend investment plans because of a lack of necessary permits and licences.

Eldorado's TSX-listed stock on Thursday rose 4.3% to C$2.91 a piece, clawing back some of the 43% value it has lost since the start of the year.