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Holding KCM 2000 bets on circular economy practices to drive growth

Holding KCM 2000 bets on circular economy practices to drive growth

HOLDING KCM 2000 was formed in 2022 by consolidating the business activities of the group of companies associated with the Plovdiv-based KCM and the Rhodope mining companies Gorubso Madan, Varba Batantsi, and Laki Invest into a common holding structure. KCM is the largest company for lead and zinc production in Southeastern Europe and exports its products to almost the entire world. Rumen Tsonev is HOLDING KCM 2000’s CEO and Chairman of the Board of Directors.

Mr. Tsonev, KCM has a rich history, and the holding companies specialise in various areas of metallurgy – from ore mining to metals trading and engineering. Please share more about the portfolio and how these different business operations complement each other.

HOLDING KCM 2000 is a Bulgarian mining and metallurgical holding company structured entirely with Bulgarian capital.  The holding company was established in 2022 by combining the business operations of the group of companies associated with the Plovdiv-based KCM and the Rhodope mining companies Gorubso Madan, Varba Batantsi, and Laki Invest into a common holding structure. This way, we were able to achieve vertical integration of our business – from the mining of raw materials to their processing to metals. Our core business operations are the metal mining, production, and trade, and our main products are lead and zinc metals. 

The natural synergy and integration between the successful 60-year tradition in metallurgy and more than 70 years of experience in ore mining and enrichment is a strong prerequisite for sustainable development, and this gives us the confidence to continue to build and develop.

This complex structure requires constant investment – what are the most significant investment projects the company has completed over the years?

Our investment projects implementation approach is to plan an investment program with a 10-year horizon. One of our most significant projects that we implemented in our first investment period was the so-called Japanese Project. This year marked the 20th anniversary of its successful completion. This project gave our company a new look, and its task was to solve mainly environmental problems and create a sustainable development basis. Its implementation provided us with stability, which enabled us to dream of introducing new technologies that would make us the best in the world. The next project of great importance for our company is the Process Innovation and Production Increase Project. This project laid the foundations for a major development towards energy efficiency at our Lead Plant. We enabled our company to develop as a company that largely produces its metals from recycling waste products at both our Lead and Zinc Plants – in practice we now have a mini model of a circular economy on one site. We are now in our third investment window and have already structured a new Process Integration of KCM AD Project. We have secured funding and have started to implement some parts of the project.

Metallurgy is one of the industries with high energy demand and in the light of the Green Deal and the Net-Zero Industry Act (NZIA), there is increasing talk about the need to develop energy storage solutions. Can you share what are the advantages of Bulgaria and KCM in particular in this context?

It is important to know that without non-ferrous metals, the Green Deal will not succeed – they are essential for energy storage. The NZIA has yet to support investment in industrial plants and products key to achieving this deal. Some of the strategic net-zero technologies are solar photovoltaic and solar thermal technologies on the one hand, and in terms of the construction of large RES projects, as well as in infrastructure, zinc plays a key role in protecting steel structures from corrosion. On the other hand, talking about batteries and energy storage technologies, we cannot but highlight the role of lead-acid batteries, which are considered the best and most environmentally friendly energy storage technology, thanks to lead's infinitely recyclable property. In this respect, Bulgaria has over 60 years of experience in the mining, processing, and production of basic raw materials for the metallurgical industry, and metallurgical plants, in particular KCM, apply the best base metal production technology in compliance with EU environmental standards. Moreover, the HOLDING KCM 2000, including the Gorubso Madan, Varba-Batantsi, and Laki Invest mining companies and the KCM metallurgical company, has a long tradition of mining and producing lead from primary (ore) and secondary (waste) raw materials. The integrated lead and zinc production process at KCM utilises technologies for the complex recovery of lead from discarded lead-acid batteries, without producing any unprocessable waste. These are sourced primarily from Bulgaria and thus contribute to the achievement of waste management objectives and the implementation of circular economy principles.

HOLDING KCM 2000 is known for its significant contribution to the regions where your companies are located. What specific measures have you taken to support local communities?

The structuring of HOLDING KCM 2000 is of strategic importance for the development of the Smolyan and Plovdiv regions. The Holding maintains and develops a Corporate Social Responsibility Program, aimed both at the human resources of the companies and at supporting socially significant projects and events for the development of the communities in which the companies operate. Over the past three years, the projects and initiatives supported under this program have reached BGN 5 mln, making us the largest corporate donor to these communities in the areas of culture, education, healthcare, infrastructure, and sports. It is important to note that the Holding employs over 3,000 people, with gross remuneration exceeding the national average values. The above characteristics make us a key player in the transformation of the local economy, with a key role in the local labour market.