Shares in Eldorado Gold Corp. closed 3.5 per cent higher on Wednesday after it announced that an arbitration panel had ruled in its favour in its dispute with the Greek government over its Madem Lakkos metallurgical plant.

The panel rejected allegations that a technical study was deficient and was in violation of a transfer contract and the environmental terms of the project, the Canadian miner said in a statement.

The Madem Lakkos plant is designed to treat ore concentrates from its Olympias gold and silver mine and Skouries development project, two of three deposits that are part of the Kassandra assets owned by Eldorado's Greek subsidiary.

"We believe this decision provides a foundation to allow us to advance dialogue with the Greek government in order to define a mutually agreeable and clear path forward for our Kassandra investments," Eldorado CEO George Burns said in a statement.

"We look to the Greek state to fulfil its obligations under the transfer contract including issuing the outstanding permits for the Skouries project. The full, efficient and responsible development of the Kassandra assets will benefit the Greek state and its citizens."

In November, Eldorado suspended work at its Skouries project and threatened legal action because it said Greece's Ministry of Energy and Environment had not issued the required permits.

Eldorado shares, which gained 6.5 per cent on Tuesday, rose by as much as 14 per cent to $1.30 on Wednesday morning on the Toronto Stock Exchange before closing up four cents at $1.18. The company's stock began the year at $1.81.

Eldorado said it is working to improve its environmental impact in Greece, pointing out it recently submitted an updated technical study for the Skouries project which reduces its footprint by 40 per cent.

The gold and copper mine would have both open pit and underground operations.

Eldorado has operations in Turkey, Greece, Canada, Romania, Serbia and Brazil.