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Slovakia is located in Central Europe, landlocked between Poland in the south, and Austria, the Czech Republic, Hungary, and Ukraine. The total area of the country is 49,035 km2, and it has a population of 5,450,421 as of 2018. The country's climate is mostly temperate, with cool summers; cold, cloudy, humid winters.
Slovakia was part of former Czechoslovakia, which was a Communist nation during the years of Soviet dominion in Eastern Europe. After the Soviet Union disintegrated in 1989, Czechoslovakia moved away from Communist ideals. On 1 January 1993, Slovakia and the Czech Republic were formed after a peace agreement between two ethnic groups.
As an independent nation, Slovakia became a member of NATO and the EU in 2004 and 2009, respectively. The country launched several significant economic reforms to improve the standard of the nation. The government has been open to foreign investment by implementing transparent commercial policies. Although the country has corruption and unemployment issues, the GDP of Slovakia is estimated to be $209.186 billion in 2020.
Introduction to Mining, Minerals and Fuel Resources
After the fall of its communist regime, Slovakia has become one of the fastest developing countries in Central Europe. Minerals are the basis of production for metallurgical, electrical, chemical, ceramic and glass industries in Slovakia.
Slovakia has a large mining industry and it is the host of the world's largest magnesite deposits. The natural resources of Slovakia are mainly brown coal and lignite with small quantities of iron ore, copper and manganese ore as well. The mining sector has not made any significant contribution to mineral production in recent years.
Overview of Resources
In 2010, the production of mineral commodities in Slovakia increased due to the increased demand among Slovakia's chief trading partners. By 2016, the country was ranked an estimated 8th in the world in the production of magnesite. The only metals mined in Slovakia were gold and silver. The metallurgical sector produced aluminum, crude steel, ferroalloys, pig iron, and secondary copper.
The country also produced several industrial minerals, such as cement, clays, and shale, and stone, in addition to limited amounts of mineral fuels (coal, natural gas, and crude petroleum plus refined petroleum products).
In 2016, the mining sector's output was as follows:
- Secondary copper increased by 277%;
- Ferromanganese increased by 40%;
- Silicomanganese increased by 32%;
- Barite (mine production) increased by 25%;
- Kaolin increased by nearly 14%;
- Talc decreased by 30%;
- Nitrogen (N content of ammonia) decreased by 25%;
- Perlite decreased by 24%;
- Bentonite and gypsum decreased by 21% each;
- Gold (Au content of concentrate) decreased by 20%;
- Ferrosilicon decreased by 17%;
- Silver (Ag content of mine production) decreased by about 15%;
- Magnesite decreased by 14%;
- Crude petroleum decreased by about 10%.
Mining production in Slovakia increased 9.70% in December of 2019 over the same month in the previous year.
Energy minerals
Geological reserves of energy minerals are limited to brown coal, lignite, and uranium. However, only brown coal and lignite are produced. Uranium extraction is complicated due to environmental and land access issues. The total geological reserves of mineral fuels registered in Slovakia reach 1,149 Mt, 46% of which are classified as economic reserves.
Brown coal: Brown coal deposits occur at various geological levels of the Horna Nitra fold, the South Slovak basin, the Danube basin, and the Vienna basin.
Lignite: Lignite deposits are present in the Vienna basin, in the marginal parts of the Danube basin and the East Slovak basin. Resources are estimated at just over one billion tonnes. In 2018, 1.5 million tonnes of lignite were produced, of which over 90% of the total lignite production was used for electricity generation and district heating.
Metals
In the past, Slovakia was a host of many economically important metal deposit resources. During the Middle Ages, gold production in Slovakia was of crucial importance to Europe. However, nowadays, most of these deposits are exhausted.
The only metal resources regarded as economic are:
- Iron ore in the Nizna Slana deposit
- Silver and copper in the Rožňava–Strieborná deposit
In 2009, Tournigan Energy Ltd. struck a deal with Ortac Resources plc of UK for the sale of its Kremnica gold exploration project. Later in 2010, Ortac Resources signed another agreement that purchased 80% shares in the Kremnica project.
By 2016, this had increased to a 100% share: a maiden reserve estimate reported proven and probable reserves of 14 million metric tons grading 1.70 grams per metric ton (g/t) gold and 14.22 g/t silver; contained metal was 27,000 kilograms of gold equivalent. Gold production was predicted to average more than 2000 kg per year of gold equivalent during a mine life of 11 years. These figures were based on a pre-feasibility study conducted in 2013.
Fossil Fuels
Slovakia lacks any significant exploitable fossil energy reserves; the extraction of crude oil and fossil gas accounts for less than 2% of overall energy supply, and there is quite a large potential for gas storage.
The Ministry of Economy states that due to rigorous restructuring operations in the coal sector of Slovakia, production of coal is likely to be affected for the next 10 years. The Ministry predicts that in 2015 production would be about 2 million Mt, in 2025 about 1.5 Mt, and in 2030 about 1 Mt.
Hornonitrianske Banke Prievidza is Slovakia's top brown coal producer. The coal mine at Handlova is estimated to produce about 300,000 Mt/yr until 2020, following which it was scheduled to be closed. It is one of the most dangerous mines in the country because it is full of methane; in 2009 there was a fire in an abandoned underground mine shaft, which resulted in an explosion and the death of 20 people.
Similarly, the HBP Mine at Novaky is estimated to produce 1.2 Mt in 2015 and 2020, 1 Mt in 2025, and 0.5 Mt in 2030, following which it would be closed.
Investment
Some of the benefits for foreign investors in Slovakia are as follows:
- Low taxes
- No dividend taxes
- Inexpensive and skilled labor
- Comparatively liberal labor code
- Strategic geographical location
The government is keen on promoting its coal industry, as the country is low in primary energy resources. About 86% of energy resources are imported every year: in 2016, Slovakia depended on imports to meet its demand for bituminous coal, metal ores for the metallurgical sector, and most of its hydrocarbons.:
In October 2012, Greenpeace activists protested against coal mining in Upper Nitra. The activists wanted the funds diverted from this project and used for promoting green projects and public infrastructure. They believed that the mine will cause health hazards to the locals and pollute the environment.
Mining experts predict that there will not be any major change or increase in Slovakia's mineral commodities produced in the coming years. The country will continue relying on metallic ores and concentrates as well as minerals to fuel imports for its domestic needs.
Sources and Further Reading
Article updated on 03/03/20 by Kerry Taylor-Smith