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“Europe: open for mining?”

In the run-up to the Inaugural MINEX Europe Forum which took place in Vienna on 17-18 November 2015, Advantix Ltd (the forum organiser) invited parties interested in the MINEX Europe ethos to participate in a survey entitled “Europe: open for mining?”.

The survey was aimed to address the common misconceptions concerning mining prospects in Europe.

  • “Europe: open for mining?” survey offers opportunity for governing and regulatory bodies to receive feedback on how their country is viewed by operating businesses.
  • It enables regulators to focus on the particular areas which will help to promote investment in the coming years.
  • Shifts in sentiment will be reflected in an annual update of the survey, which will be conducted by the organisers alongside the 2nd MINEX Europe Mining & Exploration Forum planned in June 2016.  
  • The results from future surveys will be used to draw a yearly comparison and will hopefully identify trends and changes in the development of the mining industry in Europe.
  • The accuracy of the Survey can be further improved by increasing the number of responses and adding European countries, which received insufficient number of responses to be included in the Survey. 

 

Mining prospects in Europe

Europe mining update 2015

Access to mineral resources underpins European industrial production infrastructure, development and maintenance.  Sufficient supply of mineral resources is an indispensable foundation for prospering economic development. Non-energy raw materials are intrinsically linked to all industries across all supply chain stages, and consequently they are essential for our way of life – everything is made from materials.

Mineral exploration and mining, as part of the mining cycle, are responsible for ensuring that the supply of resources adequately meets the requirements of the industry. An increase in population and living standards will continue to drive growing demand for manufactured products and therefore the raw materials. The ongoing global transition towards a high-tech and renewable society is especially sensitive because of the substantial amount of critical raw materials required for such technology.

Important raw materials sources are increasingly located in the parts of the world, which lack political and economic stability. Reliable access to minerals and metals is essential for raising Europe’s prosperity.

It has been estimated that 30 million jobs in the EU are directly reliant on access to raw materials. However, very little primary production occurs within Member States themselves, with the majority produced and supplied from third countries.

According to the World Mining Data 2015 report, current mining output of the European countries is modest compared to the other global producers. Germany and the European part of Russia were listed at the at the bottom of the World’s top 15 Mineral Raw Materials producers in 2013.

Analysis of the global primary supply of the fifty-four candidate materials identifies around 90% of global supply originated from extra-EU sources. EU primary supply across all candidate materials is estimated at around 9%. In the case of critical raw materials, supply from the EU sources is even more limited.

Europe remains one of the World’s key consumers of the Mineral Raw Materials highly dependent on imports from non-European countries. In 2013, Germany produced just over 235.5 million metric tonnes of Mineral Raw Materials which represents 2.92 metric tonnes per capita. According to the 2014 Eurostat figures, the raw materials consumption in the EU-27 countries was 14.2 tonnes per capita, while domestic material consumption was 13.5 tonnes per capita.

Europe’s relatively restricted landmass has a remarkable variety of geological terrain. As a consequence, Europe has a rich endowment of all major groups of minerals. In the ninetieth century the continent’s industrial economies were built on Europe’s resources of metals and coal.

After years of anti-mining sentiment in Europe that has seen a move to ever-increasing imports, the EU members and other European countries are starting to recognise the opportunities gained from exploiting natural resources closer to home. Securing reliable, sustainable and undistorted access of certain raw materials is of growing concern within the EU and across the globe.

Respondents

Respondents profile 

It represents  opinions from companies and individuals operating in Europe who indicated the key factors which from their perspective affect European mining entrepreneurship, especially at small and medium types of business. The survey results give an insight as to how closely the general perceptions of each European country’s conditions match the experiences of those exploration and mining companies operating on the ground, as well as promote healthy discussion of the positive and negative issues experienced in each country.

The survey includes responses received from companies and individuals with current operating projects and experiences in the 24 European countries, namely Albania, Austria, Bosnia and Herzegovina, Bulgaria, Czech Republic, Denmark, Estonia, Finland, France, Italy, Germany, Montenegro, the Netherlands, Poland, Portugal, Romania, Russia (European part), Serbia, Slovakia, Sweden, Spain, Turkey, Ukraine and the United Kingdom. 

21% of respondents who took a part in the survey represented junior exploration and development companies. Over 16% of respondents work for major mining companies. 8% respondents represent mineral processing and metallurgical companies.  Over 25% respondents provide consulting, environmental and engineering services.  Feedback received from Investors and Government Regulators represent approximately 10% of the total responses.  Remaining 30% represent NGOs, Research Organisations, Academia, Equipment suppliers, Legal services and Mining Software.  The primary commodities focus of mining and exploration companies who took part in the survey: Industrial minerals (17.3% of all responses), followed by base metals (15.8%), precious metals (14.4%)and specialty and rare metals (13.7%), and while 10.1% focused on ceramic & refractory minerals, all other commodities rated less than 10% of all responses.

Respondents replied to the following questions related to each particular country by rating their answers from highly negative to highly positive:

  • Overall impression of mining business environment
  • Favourability of mining legislation in terms of licencing tenure and taxation
  • Environmental and labour regulation
  • Access to information
  • General attitude towards mining operations
  • Geological prospectivity
  • Availability of land for exploration
  • Cost of labour
  • Corruption
  • Language/cultural barriers
  • Ease of setting up a local limited company
  • Workforce availability
  • Quality and access to infrastructure

Key factors

Key factors influencing mining in Europe 

  1. Majority of respondents name mining legislation and regulation as the main factors affecting mining business in Europe. 
  2. The second of the most important factor affecting mining business in Europe is accessibility of information, which includes access to information about geology, historical exploration, current exploration and mining operations, current land-use and landowners, licensing process, country regulatory requirements, regional regulatory requirements, environmental requirements. 
  3. The third most important perceived factor affecting mining business in Europe is the attitude towards mining operations of the national governments, local authorities, general population and media.

Respondents were also asked to rank their perception of geological prospectivity, availability of land for exploration, the impact of corruption on doing business, cost of labour, language & cultural barriers, ease of setting up a local limited company, workforce availability, and Quality and access to infrastructure (transport, utilities) in each of the countries in which they operate.

Results

Survey results 

1. Favourability of mining legislation

  • Mining legislation in Finland, Bulgaria, Slovak Republic, Serbia and Germany were considered to be most business friendly.
  • Portugal, Spain, Sweden and Turkey ranked as the second most attractive countries.
  • The respondents expressed neutral views on mining legislation in such countries as the UK, the Netherlands and Romania.
  • Estonia ranks as the least attractive country for mining in Europe, after France, Denmark, Poland and Italy.

2. Access to information

  • Finland, Germany, Slovakia and Sweden provide the highest level of access to information.
  • The UK, Ukraine, Serbia, Austria, Spain, Italy, Estonia, Portugal, Romania, Bulgaria and France ranked as the second most attractive countries based on accessibility of information.
  • The respondents expressed neutral views on access to information in such countries as Denmark, Bosnia and Herzegovina, Czech Republic and Poland.
  • Albania and Montenegro rank as the countries  with the most difficult access to information, after Russia and the Netherlands.

3. Attitude towards mining operations

  • Countries with the most positive attitude towards mining operations are Czech Republic, Albania, Finland, Spain, Russia, Denmark, Serbia and Bulgaria.
  • Countries with the most negative attitude towards mining operations include France, Montenegro, the Netherlands and Slovakia.

4. Geological prospectivity

  • Geological prospectivity in Finland, Portugal, Romania, Serbia, Spain and Sweden is considered to be the highest.
  • Good geological prospectivity is in Albania, Estonia, France, Germany, Poland, Russia and Turkey.
  • Poor geological prospectivity is in Bosnia and Herzegovina and Montenegro.

5. Availability of land for exploration

  • Finland, Sweden, Spain and United Kingdom are perceived to have very good availability of land for exploration.
  • Montenegro, Slovakia, Turkey, Albania, Bulgaria, Czech Republic, Poland, Portugal, Russia’s European part, Serbia, Ukraine and Germany are perceived to have good availability of land for exploration.
  • Poor availability of land for exploration is, however, perceived in Estonia, Romania, France, Italy and Bosnia and Herzegovina.

6. Quality and access to infrastructure (transport, utilities)

  • Very good quality of infrastructure are in Sweden, Spain, Finland, Germany, Portugal, Austria, France and the Netherlands.
  • Estonia, Italy, Slovakia, Bulgaria, Czech Republic, Poland and the UK offer good quality and access to infrastructure
  • Poor quality of infrastructure is in Romania, Russia (European part), Montenegro, Turkey, Bosnia Herzegovina and Serbia.
  • Very poor quality of infrastructure for mining is in Albania and Denmark.

7.Cost of labour

  • The highest cost of labour is perceived to be in Germany, Finland, Sweden and Denmark, followed by Austria, France, Italy, the Netherlands, Czech Republic and the UK.
  • The lowest cost of labour is perceived to be found in Albania and Romania, followed by Ukraine, Turkey, Portugal, Montenegro, Bulgaria, Serbia, Slovakia,  Russia, Bosnia and Herzegovina.
  • Finding employees with sufficient training is considered very difficult in Albania, Bosnia and Herzegovina, Denmark, Poland and Turkey, but companies which operate in Ukraine, Italy, Portugal and Slovakia think it is very easy to find employees with sufficient training.

8-9. Corruption /Language/cultural barriers

  Corruption

  • Very high impact of corruption on business was mentioned by companies which operate in Bulgaria, Russia, and Ukraine.
  • High level of corruption is perceived in Slovakia, Romania, Italy, Bosnia Herzegovina and Albania
  • No impact of corruption is experienced by mining businesses in Finland, Spain, Sweden, Czech Republic, Germany, the Netherlands, the UK and France.

Language/cultural barriers

Language and cultural barriers are considered high by companies which operate in Albania, Turkey, Ukraine and Russia.

10. Set up a company

  • Respondents think it is difficult to set up a local limited company in Austria, Czech Republic, the Netherlands, France, Poland, Ukraine and Germany.
  • Respondents consider it very easy to set up a local limited company in Denmark, Serbia, the UK and Bosnia and Herzegovina.

Forward looking statement

  • “Europe: open for mining?” survey offers opportunity for governing and regulatory bodies to receive feedback on how their country is viewed by operating businesses.
  • It enables regulators to focus on the particular areas which will help to promote investment in the coming years.
  • Shifts in sentiment will be reflected in an annual update of the survey, which will be conducted by the organisers alongside the 2nd MINEX Europe Mining & Exploration Forum planned in June 2016.  
  • The results from future surveys will be used to draw a yearly comparison and will hopefully identify trends and changes in the development of the mining industry in Europe.
  • The accuracy of the Survey can be further improved by increasing the number of responses and adding European countries, which received insufficient number of responses to be included in the Survey.

Organiser

Survey organiser – Advantix Ltd

Founded in 2002 Advantix Ltd is a UK-registered Business Events and Communications company with strong focus and in-depth experience in organisation of international Mining events in Russia, Central Asia, China and the countries European region.

Advantix Limited owns and manages MINEX Forum which in 2014 became a registered trademark.

Further information about MINEX Forum – www.minexforum.com and www.minex.club 

Advantix offers extensive range of business development and event management services including:

  • Management of business development projects;
  • Organisation of business events with the focus on Mining & Metals and Capital Markets;
  • Organisation of professional training workshops and master classes;
  • Management of special events such International Road Shows, Industry Awards, Business Clubs, Press briefings, Business presentations etc.


Contact details:

Advantix Ltd

7-10 Adam Street, The Strand

London WC2N 6AA

United Kingdom

Tel: +44 (0) 207 520 9341
Fax: +44 (0) 207 520 9342
Email: admin@advantix.co.uk