Serbia may be on cusp of mining revival after years of decline – by Aleksandar Vasovic and Stephen Eisenhammer (Reuters U.S. – June 13, 2013)

Reuters) – Serbia’s mining sector, stagnant since the wars that tore Yugoslavia apart in the early 1990s, looks set for a revival as volatile commodity prices increase the allure of countries in Europe with established infrastructure and skilled labor.

Once home to a core copper and gold mining facility for the former Yugoslavia, the town of Bor in the north-eastern corner of Serbia has a history of mining dating back to Roman times.

Canadian major Freeport and its smaller partner Reservoir Minerals are exploring the area’s underground reserves. Early results have impressed investors and analysts. “The grades they’re drilling are exceptional… These come around once a decade,” said Brent Cook, a geologist and private investor who writes an investment newsletter.

International mining firms are under pressure from increasingly cautious investors to move away from projects in non-traditional mining countries where a lack of good roads, railways, water and power, as well as skilled workers, can hike costs.

Eastern Europe, along with Spain and Greece, has emerged at the forefront of this shift, with governments that are eager to help boost jobs and growth.

Canada’s Gabriel Resources is planning Europe’s biggest open cast gold mine in Romania, while Dundee Precious Metals aims to double current gold production in Bulgaria to 300,000 ounces a year by 2016.

The Freeport and Reservoir project is at an earlier stage but is drilling good grades along the Timok belt where state-owned RTB Bor – short for Mining and Smelting Basin Bor in Serbian – is also located.

“These are Congo-type grades in Europe,” Reservoir Mineral’s chief executive, Simon Ingram, said in an interview in London.

The drill hole in April showed copper ore of 7.2 percent equivalent, far above the average global deposits usually under 1 percent, meaning more copper for less rock mined, adding to results that Freeport called “encouraging”.

For Ani Markova, who co-manages the Global Gold and Resources Fund at asset manager Smith and Williamson, Serbia is part of a wider trend.

“You have to put Serbia in the whole context of Eastern Europe which is opening up for mining… This is an area which I think will grow in the next few decades in terms of the supply of materials to Europe and the world,” Markova, who has invested in Reservoir and Dundee, told Reuters.


Serbia was made an official candidate to join the European Union only last year after slow progress in recovering from the wars that tore apart Yugoslavia in the 1990s and the disastrous 13-year rule of Slobodan Milosevic.

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