Mining royalty collection up by 75% in H1

TIRANA, Aug. 18 – Government revenues from mining royalties rose by 75 percent in the first half of this year, according to data published by the General Customs Directorate. Compared to 2009 when legal changes increasing royalty rates were not effective, collection has increased by almost 10 times. For the first six months of 2012 government collected 2.6 billion lek in mining royalty, up from 1.5 billion during the same period in 2011 and only 277 million lek in the first half of 2009.
Data show the customs administration collected 3.6 billion lek (Euro 25 million) in 2011, up from 2.1 billion lek in 2010 and only 893 million in 2009. The mining royalty varies from 4 to 10 percent based on the kind of mineral. For chromium and copper, two of Albania’s most extracted minerals, the royalty is at 6 percent.
The increase in royalty is also a result of the increase in the number of concessions government has been awarding in the mining sector.
Data show some 770 mining permits are currently in force of which 150 are for exploration purposes.
The new 2011-2014 strategy on the mining sector foresees a 5 percent increase in production. Under the new law, the local government units will benefit 20 percent of the mining royalty.
Since 1994, when a new mining law was approved soon after the communist system collapsed, Albanian mines have been explored by private companies under mining permits and concessions.
Currently, three main companies are involved in mining in Albania, Austria’s DCM Decometal and Canada’s Empire Mining Tirex Resources.
Albania has around 390 million tonnes of unexplored oil reserves, some 3 billion m3 of natural gas, 740 million tonnes of coals, 32 million tonnes of chrome, and hundreds of tones of other iron-ore and copper reserves, proving the country’s rich mineral reserves despite the small territory it occupies. The findings are revealed in the latest mineral resources map of Albania, an updated version of 1971 and 1989 publications during the country’s communist regime.
The map features Albania’s metal and non-metallic mineral combustible materials and mineral waters in a computerized version accompanied by databases, also classifying the resources based on their importance.