UPDATE 2-Romania set to reject gold mine project
* Parliament due to hold session in coming days
* PM says there is clear political will to reject project
* Says street protests have been important
* Gabriel seeks clarification, could consider legal action
BUCHAREST, Sept 9 (Reuters) - Romanian lawmakers are set to reject a long-running bid by Canadian miner Gabriel Resources to open Europe's biggest open-cast gold mine in the Carpathian mountains due to mounting opposition, Prime Minister Victor Ponta said on Monday.
The plan has been stuck for 14 years and last month the leftist cabinet of Ponta, which opposed it before coming to power in 2012, renegotiated the contract and raised the royalty tax on gold to 6 from 4 percent, as well as the state's stake in Gabriel's local business to 25 percent from roughly 20 percent.
The local business, the Rosia Montana Gold Corporation, said earlier this month it expected Romania's parliament to vote in favour of the project despite protests.
Thousands of people in cities across Romania took to the streets for nine days in a protest against the project, which wants to use cyanide to mine 314 tonnes of gold and 1,500 tonnes of silver, and rallies have continued in the capital ever since.
"Basically, today we must rapidly begin the rejection proceedings in the senate, then in the lower house, and that's it," Ponta told reporters.
"It's very clear a decision was taken."
Earlier in the day Ponta's main coalition ally, presidential candidate and senate head Crin Antonescu said legislators could not support a project against such overwhelming opposition.
A vote in parliament has yet to be scheduled but political sources said it could called as early as this week.
Gabriel said in a statement it was seeking clarification and could consider legal action.
"It appears that the government has instituted emergency procedures to halt any debate in parliament," it said.
"Gabriel is urgently seeking confirmation of the actual statements made and clarification of the impact on the proposed permitting of the project. If the draft legislation is rejected then the company will assess all possible actions open to it, including the formal notification of its intentions to commence litigation for multiple breaches of international investment treaties."
The mine, which is supported by most of the local population and President Traian Basescu, could bring billions of euros in taxes and jobs to an economically depressed region.
"Protests will continue until the parliament's houses reject through vote the law proposal," anti-mine organisation Alburnus Maior said in a statement.