MINERAL COMMODITY SUMMARIES OF THE CZECH REPUBLIC 2017 STATISTICAL DATA TO 2016 (Data deadline: August 31, 2017) 25th Edition Czech Geological Survey October 2017 Compiled by: Jaromír Starý Ivo Sitenský Dalibor Mašek Tereza Hodková Mirko Vaněček Jaroslav Novák Pavel Kavina Typesetting: Oleg Man Graphic design: Oleg Man Ludmila Richterová Budoš Volák Renata Kachlíková [email protected] www.geology.cz 3 CONTENTS EXPLANATORY NOTES . 11 List of abbreviations, symbols and technical units . 11 Exchange and inflation rates of currencies in which minerals are priced . .14 Annual inflation rates (%) in the USA (US), the United Kingdom (UK), the Euro Area (EUR) and the Czech Republic (CZ) . .14 Average yearly exchange rates of CZK against EUR, USD and GBP . .15 Mineral reserve and resource classification in the Czech Republic and its evolutional comparison with international classifications . .16 Czech classification . .16 International classifications . .18 Comparison of Czech and international systems of classification . .22 Conclusions . .23 INTRODUCTION . ..24 MINERAL BASE OF THE CZECH REPUBLIC AND ITS DEVELOPMENT IN 2016 . .27 1. Legal framework for mineral resource use . .27 1.1. Reserved and non-reserved minerals and their deposits . .27 1.2. Planning, approval and carrying out of mineral prospecting and exploration . .27 1.2.1. Reserved minerals . .27 1.2.2. Non-reserved minerals (and their mining) . .28 1.3. Permit to mine a prospected and explored deposit . .28 1.4. Royalties on reserved minerals mined . .29 1.5. Reserves for mining damages and remediation during the mining of reserved minerals . .30 2. Selected statistical data on exploration and mining on the territory of the Czech Republic . .30 3. Significance of mining in the Czech economy . .31 4. Trends of reserves of minerals (economic explored disposable reserves) . .31 5. Summary of exploration licences valid in 2016 and newly issued in 2016 (listed according to minerals) – prospecting and exploration works financed by companies . .32 6. State-funded geological projects . .32 6.1. Economic geology projects . .32 6.2. Other geological projects . .33 Contents 4 7. Summary of selected legal regulations on mineral prospecting and exploration in force as of June 30, 2017 ................................34 7.1. Acts ............................................................34 7.2. Other legal regulations ..............................................34 7.2.1. Mineral deposits exploitation .....................................34 7.2.2. Geological work ...............................................35 7.2.3. Regulations on licensing of mining operations and verification of qualification ................................................35 ECONOMY AND MINERALS .............................................36 Development of the Czech and global economies and the importance of minerals ..............................................................36 1. Macroeconomic development of the Czech economy .........................36 2. Changes in demand ...................................................39 3. Structural changes in the Czech economy ..................................42 4. Glossary of selected economic terms ......................................47 Development of the global economies and importance of minerals ...................49 1. Global economic development ...........................................49 1.1 The main challenges of the world economy ..............................50 1.2 Development of major centres of the world economy ......................52 2. External balance of the Czech Republic and the role of Foreign trade ............60 2.1 Foreign trade structure ..............................................65 3. External balance ......................................................73 4. Terms ..............................................................77 Foreign direct investment in mining in the Czech economy ........................78 Mineral facts: Don’t bank on it ...............................................81 Studying the feasibility study ..............................................82 Why fudge it ...........................................................83 Fundamental flaws ......................................................84 The economic situation of mining companies ...................................86 Mining in total .........................................................86 Sales in 2016 ..........................................................87 Number of companies ...................................................88 Number of employees ...................................................89 Average number of employees per enterprise .................................89 Sales . .90 Average revenues per enterprise ...........................................91 Value added ...........................................................92 Contents 5 Labour productivity based on value added . .92 Hourly labour productivity . .93 Sales per employee . .94 Average salary . .95 Value added – salaries per employee . .95 Bituminous coal, brown coal, and lignite . .96 Kaolin . ..97 Clays and bentonite . .98 Feldspar . .99 Glass sand . .99 Foundry sand . .100 Limestone and corrective additives for cement production and dolomite . .101 Dimension stone . .102 Crushed stone . .103 Sand and gravel . .103 Brick clays and related minerals . .104 Other minerals . .105 Outline of domestic mine production . .106 Domestic share in the world mine production . .107 ENVIRONMENT AND MINERALS . .108 Mining and nature protection . .108 Specially protected areas (ZCHÚ) in the Czech Republic . .108 National parks in the Czech Republic . .108 Structure of ZCHÚ in 2016 . .109 Mining of reserved and non-reserved mineral deposits in CHKO . .109 Mining of reserved and non-reserved mineral deposits in individual CHKO, kt . 110 Impact of mining of reserved deposits in CHKO, t/km2 in a year . 111 Mining activities charge of the Czech Republic territory . 112 Development of reclamations after mining . 113 Reclamation after mining of reserved minerals in 2016 . 113 Share of specially Protected Areas of the Czech Republic established in localities with former mining (“after mining”) in all the ZCHÚs . 119 Eliminating negative consequences of mining in the Czech Republic – main methods and financial resources . .120 Introduction . .120 1. Use of funds from a financial reserve generated by mining companies for remediation, reclamation, and mining damages . .120 Contents 6 Financial reserve for remediation and reclamation. .120 Generated and drawn reserves for remediation and reclamation ..............121 Financial reserve for mining damages ..................................122 Generated and drawn reserves for mining damages .......................122 2. Use of funds from annual royalties paid by mining companies on mining eases and on extracted reserved minerals pursuant to the Mining Act ...........123 Reimbursements on mining leases .....................................123 Royalties on extracted reserved minerals ................................123 Reimbursements from mining lease areas paid out to municipalities pursuant to Article 32a) Sec. 1 of the Mining Act .........................124 Distribution of royalties on extracted reserved minerals pursuant to Sec. 32a) Par. 4 of the Mining Act ...................................125 3. Phase-out programme of mining activities and erasing consequences of coal, ore and uranium mining funded by the national sources ................126 Use of national sources subsidies for the phase-out of mining and to erase consequences of mining and mandatory social health expenses ..............127 4. Exploitation of proceeds from the sale of privatised property and profit from state participation in companies to remove old ecological burdens incurred prior to the privatisation of mining companies ......................128 Overview of entities with which “ecological contracts” were entered into, including guaranteed financial volumes and their actual drawn amount – as of 31/05/2017 ...........................................128 5. A programme dealing with ecological damage caused prior to privatisation of brown coal mining companies in the Ústí nad Labem Region and the Karlovy Vary Region, with ecological revitalisation upon termination of mining in the Moravian-Silesian Region, with eliminating ecological burdens caused by the exploration for and extraction of crude oil and natural gas in designated areas of the South Moravian Region, and with reducing impacts caused by the termination of coal mining in the Kladno Region based on Government resolutions in 2002 and 2008. The source of funding includes the proceeds from the sale of privatised assets and the profit from state participation in companies. .......................................129 Dealing with ecological damage created prior to privatisation of brown coal mining companies in the Ústí nad Labem Region and the Karlovy Vary Region ......................................................130 List of companies included in the programme plan: ......................131 List of regions (projects of cities and municipalities) included in the programme plan ............................................131 Finished and ongoing projects ......................................131 Revitalisation of the Moravian-Silesian and South Moravian Region ..........131 Categories of priority projects, approved by the Government, which deal with eliminating environmental damage caused by mineral mining