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Tara Resources Asserts Lack of Legal Grounds for Concession Agreement Termination

The government has no legal basis for the termination of the Concession Agreement for the Brskovo mine, as there has been no violation or failure by the company to fulfill its obligations, stated Tara Resources.

The company, managing the Brskovo mine opening project, mentioned that they are aware of the government’s decision to form an interdepartmental team to review the Concession Agreement. In this regard, they want to remind the public of the chronology of events related to the project activities.

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“Since acquiring the concession rights in 2018, Tara Resources and Brskovo Mine have invested over 30 million euros in project activities, including more than 30 thousand meters of drilling, metallurgical testing, engineering and environmental, and technological studies,” stated in the announcement.

The Brskovo mine, as stated by Tara Resources, will employ 700 people during the construction phase and over 550 people during the operational phase, with a focus on the residents of Mojkovac and the northern region of Montenegro.

“It is expected that the project’s contribution will amount to around 400 million euros in budget revenues during the operational period, including an estimated 200 million euros from concession fees and corporate taxes, as well as an estimated 200 million euros from taxes, electricity consumption, fuel costs, tolls, railway and port usage,” the statement says.

It is mentioned that the international Environmental and Social Impact Assessment (ESIA) was conducted in accordance with Montenegrin regulations, IFC and EBRD guidelines, as well as the best international practices for environmental management, health, safety, waste, and water.

As stated by Tara Resources, this document has been forwarded to the government.

They stated that the development of the project will also address the current environmental impacts resulting from previous mining operations in Mojkovac.

Tara Resources mentioned that the concession agreement is legally valid, and the government confirmed that the company fulfilled all obligations from the contract in July 2019.

As indicated, the concession agreement, which lasts for 30 years, was concluded on December 10, 2010, and is valid until December 9, 2040.

Tara Resources stated that on June 11, 2019, the government confirmed that all submitted technical documents were satisfactory for entering the next phase of the concession agreement implementation.

“To further advance the project under the Concession Agreement, the Brskovo mine has requested the government to complete the Detailed Spatial Plan, including the Strategic Environmental Impact Assessment, and issue Urban-Technical Conditions for the project area. This is to allow the company to finalize technical documentation and environmental impact assessments and submit them to the relevant authorities for review,” the statement says.

Tara Resources mentioned that they have been waiting since June 2019 for the government to complete this spatial planning process.

As they stated, the Concession Agreement has a clause that extends the contract for the same period that the competent authorities were delayed in issuing necessary permits for the concessionaire’s operations.

Tara Resources pointed out that the government has already used this clause when signing Annex 6, extending contract deadlines due to prolonged government delays in completing spatial planning, on July 22, 2021 (resolution number: 04-3528/2).

“The government has no legal basis for the termination of the Concession Agreement, as there has been no violation or failure by the company to fulfill its specified obligations,” the statement says.

It is stated that the government adopted a decision on the development of the Detailed Spatial Plan and Strategic Environmental Impact Assessment on September 23, 2021, and this decision was published in the Official Gazette on November 5, 2021.

Tara Resources stated that the Draft Strategic Environmental Impact Assessment was completed on July 27, 2022, and the Draft Detailed Spatial Plan on August 1, 2022, by the relevant planners appointed by the government and submitted to the Audit Council.

“Independent experts from that council, on April 4 last year, the Independent Expert Council for Review issued a positive opinion for the government to adopt the draft Detailed Spatial Plan, and on April 20 last year, the government announced that the draft had been adopted,” the statement says.

As stated, the public debate on the Detailed Spatial Plan and SEA was held from April 25 to July 3 last year.

Tara Resources mentioned that, according to the Spatial Planning Law, the Ministry of Spatial Planning must compile a report on the public discussion and submit it to the Audit Council within 15 days of the end of the public discussion.

However, as stated by the company, the relevant ministry never compiled that report on public discussions, and the spatial planning process was suspended in July last year.

“The government working group recommended the completion of the Detailed Spatial Plan in June last year,” the statement says.

It is noted that previously, on January 20 last year, the Ministry of Capital Investments announced the formation of a working group to analyze the Concession Agreement in the field of mineral resources.

“Which includes representatives from all relevant ministries, including the ministries of capital investments, ecology, spatial planning and urbanism, finance, the Deputy Protector of Property and Legal Interests of Montenegro, the Environmental Protection Agency, and the Institute for Geological Research,” stated Tara Resources.

As they mentioned, in June last year, this working group prepared a report regarding the Concession Agreement.

The working group, as stated, suggested to the government to “monitor the adoption of the final decision of the government on the Detailed Spatial Plan of Mojkovac and the decision on the Strategic Environmental Impact Assessment report, which should be organized by the Ministry of Ecology, Spatial Planning, and Urbanism” and “conclude Annex 7 of the Agreement, the content of which will be specified after the completion of the public debate on the Draft Detailed Spatial Plan.”

Tara Resources, as stated by the company, continues to wait for the government and relevant ministries to complete the spatial planning process.

They mentioned that this process has been ongoing for over four years now and was interrupted in July last year.

Tara Resources, as they conveyed, looks forward to continuing transparent and proactive collaboration with the government, the Municipality of Mojkovac, the local community, and all interested parties to advance the development of the Brskovo project.

“This project has the potential to provide significant employment and economic benefits to the north of Montenegro, ensuring the best international environmental protection practices, including addressing environmental impacts resulting from previous mining activities,” the statement says.  

Source: Montenegro Business

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