One of the future largest zinc mines in Europe located in Montenegro
CEO of Tara Resources, Richard Boffey believes that together with the local community, they can significantly contribute to increasing employment and bring economic benefits to Montenegro and its people, while restoring the old splendor of Brskovo as a historically known mining region.
“Tara Resources took over the project in 2018 because we saw its strong potential and since then we have invested more than € 15 million in drilling, technical and environmental studies, with local and international experts, to confirm the profitability of the project,” said Richard Boffey in an interview with Mina-business.
The Brskovo mine will be one of the largest zinc mines in Europe and will significantly contribute to higher employment and economic development of Montenegro, Boffey said. He said the mine would restore the old splendor to the Brskovo region known for its long history of mining. He explained that the construction of the mine is reflected in a capital investment of about 150m euros. He specified that the mine will also pay concession fees and taxes of around ten million euros a year.
Approximately EUR 3 million of annual concession fee would go directly to the Municipality of Mojkovac.
“When we talk about employment, the mine currently has 15 employees, but we expect to grow and be one of the largest employers in the country. The construction phase will require 700 employees. In operations, about 450 direct and 200 indirect jobs will be created. We are now working on creating special training programs, which will support the development of human resources in the north of Montenegro needed for this project, “Boffey explained.
According to him, the project will improve the environment and nature in Mojkovac by resolving the remaining effects of the former mine.
Boffey said this mine will be completely different from the previous one.
“The project will consist of two surface mines, a plant for processing zinc, lead and copper concentrates, which also contain silver, as well as a waste management facility. All this will be located in the area of former mining operations on the hills above Mojkovac, far from the urban area “, said Boffey.
He stated that there are old waste rock dumps, open pits and underground tunnels in the vicinity. Guided by leading environmental practices and technologies, their goal, he said, is to remediate those problems and capture and treat all contaminated water. He emphasized that everything will be done in the project area, far from the city of Mojkovac. As he explained, any discharged water will be treated with water purification devices.
Asked whether the company had obtained all the necessary permits and when the mine could be expected to open, Boffey replied that the procedure for obtaining a mine opening permit involves several steps and is clearly prescribed by the Montenegrin Mining Law.
“We work closely with government institutions to ensure that all requirements necessary to obtain permits and approvals are met. Once all the permits are obtained, it will take about two years for the mine to start operating, ”Boffey said.
Coalmine Pljevlja in Montenegro recorded higher net profit in 2019
Pljevlja coalmine’s operating income reached 47.17 million euros at the end of December 2019, which is by 9.1 % more than in in 2018, according to the financial report. The coalmine recorded a net profit in the amount of 9.56 million euros in 2019, which is 43.5 % higher compared to 6.65 million euros profit in the previous year.
At the same time, operating expenses rose by 3.8 %, reaching 35.88 million euros. Salaries, benefits and other personnel expenses reached 14.14 million euros, costs of materials amounted to 9.82 million euros, depreciation and provisions reached 7.57 million euros, while other expenses reached 4.24 million euros. Total assets of Pljevlja coalmine at the end of December 2019 were worth 79.86 million euros, which is 6.7 % more than a year before. The company’s long-term provisions and liabilities amounted to 16.49 million euros, short-term to 12.73 million euros, while deferred tax liabilities reached 1.19 million euros. Retained earnings stand at 13.93 million euros. In April 2018, power utility EPCG announced that it has launched a buyout bid for the entire capital (5,064,443 shares) of Pljevlja coalmine. The bid was valid in the period between 20 April and 4 May and EPCG offered to pay 6.4 euros/share of the coalmine. According to the analysis performed by Deloitte, which said that although the price of Pljevlja coalmine shares stood at 6.9 euros at the end of 2017, the fair price is 6.4 euros/share. According to the decision of the Commission for the Capital Market in early June, EPCG became the majority owner of Pljevlja coalmine.
Montenegro ore processing and export
Exports of the metal sector in Montenegro since the beginning of the year amounted to 84.1 million euros, which is 28 percent share in total exports, the Committee of the Association of Metallurgy and Metal Industry of the Chamber of Commerce (PKCG) said.
PKCG states that, according to the latest data relating to the three quarters of this year, aluminum and aluminum products worth more than € 50 million were the most exported.
Most exported to Hungary – 34.6 million euros, Serbia 7.2 million, Slovenia 4.2 million, Albania 1.2 million and Turkey 994,400 euros, said the PKCG.
The Metallurgical Committee states that 23.3 million euros of iron and steel were exported. Of this, 7.2 million euros were placed on the German market, 6.7 million in Turkey, 1.7 million euros in Albania, while 1.7 million and 1.2 million euros arrived in Italy and the United Kingdom, respectively. For iron and steel products, by the end of September, 1.5 million euros were exported to the Czech Republic, more than one million to Albania, 997,700 to BiH and 994,600 euros to Serbia.
The value of exports of copper and copper products amounted to 4.8 million euros, with the largest share on the Italian market of 1.9 million, on the Slovenian market 1.5 million, Serbia 1.2 million. Exports of lead and lead products from January to September 2019 amounted to EUR 125,600, the PKCG said, adding that 95.2 percent were exported to the Slovenian market.
As for the commodity exchange of basic metals and metal products abroad, during the nine months of this year, a decrease of 5.2 percent was recorded compared to the same period last year.
Total exports of metals and metal products amounted to EUR 84.1 million, representing a decrease of nine percent, while imports of these products decreased by 2.9 percent and were worth EUR 150.1 million, or 7.7 percent of the total Montenegrin imports, they said in the PKCG.
According to the latest data, Montenegro produced 24,000 tonnes of aluminum worth around EUR 39.5 million by the end of August, from the planned 36.973 tonnes. As for the steel, the production of that metal was 12.35 million.
In the mining and quarrying sector, which accounted for 8.4 percent of total industrial production last year, during the eight months of this year, compared to the same period last year, there was a decline in mining and quarrying by 5.5 and 0%. , 3 percent, while in the area of metal ore extraction there was a growth of 27.7 percent, said PKCG.
Polish ZGH Boleslav accused of polluting Montenegro rivers from its lead zinc mine Suplja Stijena
The situation is of utmost concern when it comes to the pollution of Cehotina river polluted by the Lead Mine and Zinc Suplja Stijena and it can be seen at Mjedenichki stream that flows into this river.
The water of this stream, which flows from the direction of the Suplja Stijena Mine and flows into Cehotina, in previous years was practically the colour of ore, while this year it is white. The “Lipljen”, Sports and Fishing Club, which manages the waters of Pljevlja, says that they are taking some protection measures, and that one of those steps this year is to set up fishermen on the part of the river stream that is most vulnerable.
“The Fish-keeping Service is obliged to monitor the situation with Mjedenicki stream on a daily basis, to photograph and record the appearance of the water of this stream” – says President of “Lipljen” Vaso Knezevic, explaining that discussions are planned with representatives of the Lead and Zinc Mine Suplja Stijena on the topic of pollution of Mjedenicki stream that also pollutes the Cehotina river.
“We hope that we will come to a solution with these discussions” – says Knezevic, adding that in 2017, a research was conducted on the fish stock on parts of the river stream where the Mjedenicki stream flows and that it was literally destroyed. In the report, which we had an insight into, done by by Dr Danilo Mrdak, Mjedenicki stream was designated as a major pollutant of the Cehotina river. According to that report, in May 2017, the presence of fish in Cehotina was large, while in August of the same year, there was no fish downstream of the mouth of Mjedenicki stream.
“At first we suspected poaching and we continued and extended our transect to some 800 meters where we also did not detect any fish. What was extra strange to us was that we did not detect the youngest individuals or trout which was suspicious to us, because when it comes to poaching, the youngest individuals always remain in the place where it occurs” – the report said.
Mrdak also stated that greyish-yellow foam was observed on the water, in quieter areas along the rocks or deeper whirlpools, and was suspected of pollution.
The fishermen explained that there was additional pollution from the surface mine of Gradir Montengro Company, which reaches the Cehotina River via the Mjednik stream, which flows into Cehotin in Jelice, which is upstream of Tatarovin. By a trial catch on the Cehotina river several hundred meters above and one hundred meters below the place where this stream flows, we have determined that it is most likely the pollution that reaches the surface of the mine after the ore flotation process is responsible for the absence of fish fauna, that is. for fish poisoning.
By visual observation alone and without trial fishing, it is clear that this is a very serious chemical pollution because the stream and its banks have an apocalyptic appearance of yellow-gray.
“Local types of fish were detected at the site upstream of the creek, while no species of fish were detected downstream of the creek” – Mrdak said in the report, pointing out that this part of the Cehotina River may be the best habitat for the globally endangered fish species in Europe.
Gradir Montenegro company claims that they are taking all measures of environment protection
The company Gradir Montenegro, which includes the Suplja Stijena mine, repeatedly informed that all necessary protection measures are being taken and that they are not pollutants of Cehotina. They also claim that the flotation system functions completely as a closed system when it comes to the use of water, that is, that the same water is used repeatedly with, allegedly, its purification. The lead and zinc mine Suplja Stijena is owned by ZGH Boleslav of Poland.