CHRIS HUHNE, the Liberal Democrat leadership candidate and environment spokesman, has profited from the first large-scale gold mine in Egypt since the days of the pharaohs.

Huhne has made more than £35,000 by trading shares in a company developing opencast mining in a picturesque area close to Luxor and the Red Sea holiday resort of Marsa Alum.

The disclosure is embarrassing for Huhne, who made great play of his green credentials during his leadership campaign.

Environmentalists say that gold mining causes more damage to the environment than almost any other industry. Mining the precious metal produces large quantities of cyanide, carbon dioxide, sulphuric acid and waste rock.

Payal Sampat, a director of the campaign NoDirtyGold, launched by Oxfam, said: “Gold mining is just about the most environmentally destructive industrial activity on Earth. To make just one gold ring involves extracting 20 tons of rock. This activity does not exactly sit well with a green agenda.”

Caroline Lucas, the Green Party MEP for southeast England, expressed dismay that Huhne had apparently been unaware of the environmental damage caused by gold mining. “Once again we see the green claims of the major parties don’t stand up to much scrutiny,” she said.

Huhne bought 285,000 shares in the Australian mining firm Centamin Egypt in January last year on a tip from his family stockbroker. He held the shares for 13 months, during which their value rose by 47% from £75,525 to £111,150 – a profit of £35,625.

Centamin Egypt’s principal asset is Sukari Hill, where the company has been granted an exploitation licence by the Egyptian government to mine 6m ounces of gold.

The project is the first substantial gold mining in the country for 2,000 years. The vast majority of gold extraction took place when Egypt was ruled by the pharaohs.

At present, the site at Sukari Hill has nine drills operating 24 hours a day, seven days a week. The firm has built accommodation for 700 workers, workshops for mining equipment and a six-mile road to ferry away waste. Trucks deliver 150 tons of water to the site every day. Full excavation is expected to begin next year.

Centamin has said it has complied with all legal requirements while establishing the mine.

Huhne, who is MP for Eastleigh in Hampshire, became the Liberal Democrats’ environment spokesman in March 2006, just over a month after buying the holding in Centamin. He helped devise the party’s policies to make Britain carbon neutral by 2050.

Huhne said that when the environmental cost of gold mining became clear to him, he decided to sell his shares.

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