Montenegro cancels Brskovo mine concession deal with Tara - report

The move comes after the government found a problem with a feasibility study that conflicted with the country's current laws, public broadcaster RTCG quoted energy minister Sasa Mujovic as saying.

"We notified the concessionaire and gave a deadline of 30 days to correct the deficiencies. However, that deadline expired on May 25 but we did not receive a response, which means that we have in place the conditions to unilaterally terminate the contract," said Mujovic.

Tara Resources has the right to appeal the decision.

In 2010, the Montenegrin government awarded Australian mining company Sultan Corporation a 25-year exploration and mining lease rights for the Brskovo lead and zinc complex. In 2011, Sultan said it had found an initial inferred resource of 9.2 million tonnes at Brskovo, and strong upside potential.

In 2018, Tara Resources acquired the project which it is currently operating via its local subsidiary Brskovo Mine.

Tara Resources says on its website that it completed a preliminary economic assessment in 2019 and a pre-feasibility study in 2021, proving the strong economics of the project. It notes that construction of the Brskovo mine will involve a capital investment of some 180 million euro ($195 million), and will consist of two open pit mines, a processing plant, and an integrated waste management facility.

In February, local media outlet Vijesti reported that at the first session of the working group formed to examine the project, the state body in charge of protecting the property rights and interests in Montenegro declared that the government has a legal basis to cancel the concession contract with Brskovo Mine since the concessionaire has missed many of the deadlines for receiving urban and technical permits.

($ = 0.9233 euro)