Scrawled on the walls of homes in the village of Megali Panagia in northern Greece are angry slogans that show how much this picturesque community has been torn apart by a controversial gold mining project.

"Goldmines are a curse for every nation," reads one -- others are more profane.

For the past three years, the promise of a huge investment by a Canadian mining company has deeply divided the inhabitants of this spectacular corner of the Halkidiki peninsula, setting neighbours and even family members at each others' throats.

In Megali Panagia itself, tit-for-tat attacks on shops and cars belonging to rival factions of those for and against Hellas Gold -- a subsidiary of Canadian firm Eldorado Gold -- have been going on for years.

Until now, most of the demonstrations were by residents fearing that the project will cause irreversible damage to beautiful forested peninsula, one of Greece's most popular tourist areas.

But the arrival in January of a new leftist government that opposes the investment has sparked a mobilisation among Hellas Gold employees afraid of losing their jobs.

"A civil war is unfolding and the government must clear this situation up immediately," says Yiorgos Kyritsis, a legal representative for the anti-mining faction.

"I know of one pending lawsuit concerning an assault between two brothers," he told AFP.

Earlier this month, riot police were sent in when the rival groups came close to clashing in an oak forest between the villages of Stratoni, where Hellas Gold has its base, and Ierissos, whose inhabitants mostly oppose the project.

- 'There will be blood' -

Police minister Yiannis Panousis said some of the protesters fired bolts from slingshots.

Panousis warned "there will be casualties" unless the situation is resolved.

The new leftist government has clearly declared its opposition to the project, with Energy and Environment Minister Panagiotis Lafazanis recently pledging to "employ all possible legal means" to halt it.

After the latest protest Lafazanis went further, accusing the company of acting "as a state within a state" and mobilising its staff to cause violence.

"Nobody can blackmail the government... Greece is not a banana republic," his ministry said in a statement.

The mine employees, who plan to protest in Athens on April 16, counter that it is they who have faced intimidation and violence from the environmentalist faction since the project was first announced in 2011.

In the beach resort town of Ierissos, where most residents oppose the project, families of miners live in a "climate of terror", their union representative Christos Zafeiroudas said.

"What is dangerous is that this hatred has even passed to the children in the local schools. The company may leave one day, but we still live here," he told AFP.

In 2012, dozens of miners trashed an observation post manned by anti-mine activists in the mountain of Skouries, near a planned expansion site of the mine project.

- 'Holy Mountain' -

In turn, in a pre-dawn raid in 2013, hooded militants threw Molotov cocktails at the mine worksite, wounding a guard and damaging equipment.

The police station in Ierissos was later ransacked after two local men were arrested on suspicion of participating in that attack.

The minister in charge at the time said the anti-mine protesters saw themselves as real-life versions of the feisty Gauls that take on the Roman Empire in the Asterix comic books.

"We are facing opposition from a section of the local community that wants to impose its own law and operate like a Gaulish village," then public order minister Nikos Dendias said.

Hellas Gold plans to invest 1.3 billion euros ($1.38 billion) in the area overall, and extract 9.6 million ounces of gold.

Its operations, it says, have been repeatedly vetted and cleared by the authorities.

Anti-mine protesters claim the project will cause irreversible harm to the environment, draining and contaminating local water reserves and filling the air with hazardous chemicals including lead, cadmium, arsenic and mercury.

It is likely to also affect the area's agricultural and tourism economy, they say.

The site is also close to the finger of land holding the ancient monasteries that make up the independent monastic republic of Mount Athos, the "Holy Mountain" regarded by millions of Orthodox Christians worldwide as a sacred landscape.

The previous conservative government had supported the investment, arguing that it would create hundreds of jobs in the recession-hit country where the unemployment rate now stands at over 25 percent.

Another Canadian company, TVX, began an operation in Halkidiki nearly two decades ago before pulling out in 2003.

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Eldorado Gold

April