INTERVIEW – Bulgaria needs to step up exploration to ensure mining sector's vitality

“One of the key issues we are facing is the need to improve our knowledge about our subsoil deposits. We are working with information collected in the 1960s, 1970s and mid-1980s,” Mitev told SeeNews in a recent interview. “We do not know what resources we actually have, at what depth and what economic benefits they hold.”

“We need this information in order to be able to replace in ten or fifteen years the facilities we are now operating with new ones and keep the share of this industry in the country’s GDP,” he went on to say.

Mining contributes some 10% to Bulgaria’s GDP, according to Mitev. “If we add metallurgy, we have a share of some 30% of GDP,” he added.

The world’s rapid technological development is contingent on raw material supplies. The series of global crises in the past years have created shortages and dependencies, exposing Europe’s vulnerabilities, Mitev commented. “First, we had a health crisis when all supply chains were disrupted, the entire circular economy was put under a stress test. Then we had a series of armed conflicts which are still impacting the global markets.”

Europe consumes 30% of the global supply of raw materials, yet it extracts only 3%, he stressed. “For 97% of our consumption we depend on the rest of the world and these 3% cannot ensure Europe’s high-speed industrialisation. To be able to meet its needs and achieve its goals, Europe needs to reduce its dependency on imports.”

To ensure a sustainable supply of critical raw materials, in March the European Council introduced ambitious benchmarks for extraction, processing, recycling and diversification of import sources. The Critical Raw Materials Act (CRMA) identifies two lists of materials - 34 critical and 17 strategic - that are crucial for the green and digital transitions, as well as for the defence and space industries. The CRMA establishes three benchmarks for the EU’s annual consumption of raw materials: 10% from local extraction; 40% to be processed in the EU, and 25% to come from recycled materials. Extraction projects will receive their permits within a maximum period of 27 months, while for the recycling and processing projects this timeframe is set at 15 months.

As a comparison, in Bulgaria it took 17 years to open the latest mine, Mitev said. Globally, a standard industrial materials quarry usually takes some ten years to launch, he added. This, in his words, puts supplies under risk. Another risk to the development of the sector is the volatility of electricity prices, rendering incompetitive the end-price of mining products.

The new European legislation faces Bulgaria with the need to raise its administrative capacity, according to Mitev.

“We have a very solid legislative framework and specialised laws in this sector, we also have development strategies which we need to update now, but we need to increase our administrative capacity and meet the law-prescribed deadlines, and most of all, we need to have clear will on the part of politicians to follow closely our goals,” Mitev said.

Bulgaria has deposits of raw materials which are part of the strategic and critical lists identified by the European Council but their concentration is low. If, for example, the usable content of metals is 2%, in Bulgaria it is 0.3%, as through the years the sector has been making up for this with volumes and constant investments in technology and equipment. “Also, we have a very skilled labour force,” he pointed out.