KGHM pressures Gov to cut Poland mining tax
KGHM is struggling to cope with the slump in world metal prices, with copper trading below the $5,000-a-tonne level seen as the break-even point for its domestic output.
Poland’s mining tax, which hits state-run copper miner KGHM, will eventually be scrapped and in the meantime could be reformulated or cut, Polish treasury minister Dawid Jackiewicz said on Thursday.
The mining levy, which was introduced in 2012 and is assessed using a complicated formula based on local production volumes and prices, primarily targets KGHM, Europe’s second-biggest copper producer and the world’s top silver miner.
The group expected to pay 1.3 billion zlotys ($327 million) in the tax this year, equal to its net profit reported for the first nine months of 2015.
“Eventually the tax should be scrapped,” Jackiewicz told radio Wnet. “In the meantime, we will either reduce it or change the calculation formula.”
KGHM is struggling to cope with the slump in world metal prices, with copper trading below the $5,000-a-tonne level seen as the break-even point for its domestic output.
Earlier this month the company also said it would write down the value of its key foreign interests by $1 billion in its final results for 2015.
The main impairment is the Sierra Gorda mine in Chile, which KGHM co-owns with Japan’s Sumitomo . The mine, bought in 2011, started commercial production last year.
“We have to verify this investment,” Jackiewicz said. “We are not crossing it off. Billions of zlotys have been invested. We are working on a rescue plan which will enable KGHM to save this investment.”
eanwhile KGHM faces a postponement in Poland’s plans to construct its first nuclear power plant, in which KGHM was expected to be an investor as one of the country’s largest energy consumers.
“It was to be 2024, we are now talking about 2030,” said Jackiewicz, who is responsible for managing state assets.
Source; Reuters
Latest Posts
- Serbia, The real plans of the Jadar project
- Eurasian Resources Group highly commends the publication of the Critical Raw Materials Act
- Rio Tinto has spent more than a million euros on land in Serbia at the proposed site of a lithium mine that was eventually cancelled a year ago
- A new grievance mechanism for Chinese overseas mining needs to be free to use
- Europe revives mining to reduce dependence on the import of key raw materials, supply from Serbia as competitive choice
Popular Post
- Canadian mining companies in Europe & ISDS
- Serbia, The real plans of the Jadar project
- Avala Resources shareholders invited to approve transaction with Dundee, copper-gold projects in Serbia
- Europe revives mining to reduce dependence on the import of key raw materials, supply from Serbia as competitive choice
- How valuable is Kosovo’s mineral wealth?
- What Are The Major Natural Resources Of Macedonia?
- A new grievance mechanism for Chinese overseas mining needs to be free to use
- Eurasian Resources Group highly commends the publication of the Critical Raw Materials Act
- Rosia Montana in Romania, UNESCO protection and value of civic action
- Gazprom-OMV deal exclude Romania OMV refinery