Mining rights extended

Pipes at a natural gas well.
Mining rights and concessions to be automatically extended by 30 months to cope with backlogs. Photo: STA

The National Assembly has passed legislative changes to automatically extend mining rights that expire in 2023 and 2024 by 30 months. The measure was prompted by the backlog in the approval of extensions and delays in the adoption of relevant municipal spatial plans.

Mining rights have been extended once before by one of the pandemic legislative packages, by 18 months. But the backlogs that built up during the pandemic have not yet been cleared, Uroš Brežan, the minister of natural resources and spatial planning, told the MPs before the vote on the bill on 23 May.

As the changes to the Mining Act were discussed on the committee last week, State Secretary Matej Skočir told MPs that concession contracts for the exploitation of mineral resources were expiring for many holders of mining rights in June.

Last December, six months before the expiry as envisaged by the Mining Act, the ministry received more than 100 applications for extension, and had so far processed only eleven of them, Skočir said.

Brežan also pointed to delays in the passing of spatial planning documents by municipalities, which in some cases are required for a concession to be extended.

The 30-month extension will allow the backlogs that were created in municipal and other administrative procedures during the pandemic to be cleared, while the ministry will use this time to draw up systemic changes to the mining act, Brežan promised.

“The ministry will be resolving applications in time, while municipalities can adopt the relevant spatial planning documents during this time,” he added.

The changes were passed by 52 votes in favour and 20 against. The opposition Democrats (SDS) opposed the proposal, arguing that blaming backlogs on the pandemic was just an excuse.

New Slovenia (NSi), the other opposition party, did not cast their votes. Their line of argument was that the changes would not resolve the problem, only postpone a solution.

On the committee, the party’s MP Janez Žakelj quoted warnings by the State Attorney’s Office that automatic extension could undermine Slovenia’s position in the arbitration dispute with the UK company Ascent Resources regarding hydraulic fracturing in Petišovci.

“One of the key points of contention for the investors … is the fact that with each day of the concession contract that they are not allowed to extract natural gas in the desired manner they are suffering additional damage,” the office said.

In the letter to Minister Brežan, the office also noted that the investor had estimated the damage in the application for arbitration at a minimum of €500 million. Ministry officials did not want to discuss this with MPs so as not to jeopardise the arbitration procedure.

The ruling coalition warned that suspension of concessions and the subsequent withdrawal of mining rights could lead to loss of tax revenue, which would in turn jeopardise key infrastructure projects. It would also make Slovenia very dependent on imports, they argued.