Fostering the mining potential of the European Union
*Head of Unit for “Resource Efficiency and Raw Materials” at the European Commission’s Directorate General for Internal Market, Industry, Entrepreneurship and SMEs
Raw materials are decisive for the growth and competitiveness of the European economy. Only looking at the metals value chain, more than 40% of the jobs and added value from the EU’s manufacturing sector depend on raw materials. Therefore, in the second pillar of Raw Material Initiative, the European Commission proposed responding to the various challenges posed to extracting raw materials with the aim of reducing import-dependence while increasing resource efficiency and mitigating negative environmental and social impacts from extraction. In this context, the article presents priority activities concerning: the improvement of the EU’s minerals policy framework; fostering access to mineral potential; developing public awareness, acceptance and trust (PAAT), as well as research and innovation within the EU’s Horizon 2020 Research and Innovation Programme.
The entire progress of human civilisation is based on raw materials. Since the first industrial revolution, the use of raw materials has increased exponentially, both in quantity and type (Figure 1). Only in the last century, material extraction grew from 7 billion tonnes to 68 billion tonnes and projections of future trends indicate that developing regions will drive up global resource demand in the coming decades (EC, 2016). The European Union is highly dependent on raw material imports and so quite exposed to supply risk. At the global level, some European countries are at the top of the ranking of the Investment Attractiveness Index (based on the Fraser Institute’s Annual Survey of Mining Companies for mining and exploration companies) (Ferguson et al., 2015). Examples are Ireland (4th) and Finland (5th). As shown in Figure 2, a significant number of mineral deposits have been identified within the EU surface: base metals, precious metals and critical raw materials. However, the number of exploration projects is significantly lower (Figure 3), indicating that that the European potential is under-explored and therefore under-exploited (EC, 2016). Furthermore, there is a consistent dependence on imports of the metals necessary in the high-tech and manufacturing sectors (for instance cobalt, platinum, rare earths and titanium) that are crucial for current and future growth (EC, 2008).
Figure 1: Materials widely used in energy technologies (from Volker et al., 2014).
Figure 2: Mineral deposits, occurrences and showings in the EU-28, 2010 (Source: © BRGM 2016; G. Bertrand, D. Cassard, ProMine project, http://promine.gtk.fi/, retrieved January 2016).
Figure 3: Metallic mineral exploration in the EU (2014) per development stage (Source: © SNL Metals & Mining 2016).
Figure 4: Policy Perception Index and Investment Attractiveness Index (based on Fraser Institute Annual Survey of Mining Companies, 2014) (from Ferguson et al., 2015) [Both indices are normalised to a maximum score of 100 (highest level of attractiveness to mining)].
Although new mining activities are emerging, such as in Sweden and Finland, all Member States face restrictions on their domestic supplies, both in the framework of policies and as regards potential access. For instance, projects can encounter increased competition from other land uses and a highly regulated environment, as well as technological limitations in gaining access to mineral deposits. As a response, the European Commission adopted the Raw Material Initiative, an integrated strategy that since 2008 has dedicated special attention to mining’s framework conditions and, since 2014, is the framework programme for R&D Horizon 2020, which finances specific projects in the European raw material sector.
Improving the minerals policy framework
In order to facilitate a sustainable supply of raw materials from European deposits, it is important to have the right policy framework conditions in place. In the current situation, there is a need for all Member States to streamline administrative conditions and smooth the permit process for exploration and extraction activities. Whilst Member States vary in their success in policy perception and investment attractiveness, as shown in Figure 4, their responsibilities for minerals policies are frequently dispersed horizontally and vertically, endangering their enforcement. The permitting procedure, for instance, involves many authorities and requirements at local, regional and national levels that could overlap or enter into conflict (EIP, 2013).
For these reasons, the EU is funding research projects that indicate policy pathways to increase European competitiveness. One example is the study that has been commissioned with the title “Legal framework for mineral extraction and permitting procedures for exploration and extraction in the EU”, under the acronym “MINLEX”. The overall objective of this study is to provide the European Commission with a clear and detailed understanding of the legal framework, highlighting challenges and opportunities framing the Non-Energy Extractive Industries (NEEI) permitting procedures across the EU and its Member States. This information can induce further improvements in framework conditions and in the functioning of the Single Market, in order to make the investment climate more attractive to domestic as well as foreign investments. In detail, the study will provide: the screening of the European, national and regional legislation of highest relevance for the NEEI’s permitting; a search for incompatibilities, inconsistencies, infringements, violations, contradictions, inconsistencies or unnecessary duplications between them, and the review of exemplary court cases which indicates reasons for delays and success rates in each Member State.
A further aspect constraining exploration and extraction activities in the EU is the complexity of their impact on the environment. Mineral activities may strongly affect wildlife and nature. This is one of the reasons that the European Union established the network Natura 2000. Stretching over 18% of the EU’s land area and almost 6% of its marine territory, it is the largest co-ordinated network of protected areas in the world, designed to ensure the long-term survival of Europe’s most valuable and threatened species and habitats. Natura 2000 is not a system of strict nature reserves from which all human activities are excluded but, within these areas, limited activities can be carried out, subject to certain conditions.
Accordingly, in order to clarify how to reconcile extractive activities in or near selected sites, a specific guidance document was provided for the NEEI. The “EC Guidance on undertaking new non-energy extractive activities in accordance with Natura 2000 requirements” (EC, 2010) was delivered in 2010 and encapsulates the provisions of the two EU Directives, on Habitats and on Birds. It is designed principally for use by competent authorities and developers, as well as by consultants and site managers, particularly for the implementation of Article 6 of the Habitats Directive, which determines the relationship between conservation and land use. Paragraphs (3) and (4) of Article 6 set out a series of procedural and substantive safeguards that must be applied to plans and projects that are likely to significantly affect a Natura 2000 site.
The guidance document dedicates two chapters to demonstrating how the stages of the procedure are applied and how decisions are reached on the authorisation or rejection of a plan or project, in order to avoid common causes of delay in decision-making processes, such as a lack of information or poor-quality assessments. Furthermore, the practical aim of the guidance is to promote cooperation between diverse stakeholders from within the mining sector and outside it. Although it is not legally binding, it offers the NEEI all the tools to contribute positively to the environment, including mitigation measures and the rehabilitation of extraction sites.
Each Member State has to deal with its own national minerals policy but, as part of the European Union, there are advantages such as the possibility to improve practices in the above-mentioned issues. In this context, the Commission established the ad-hoc Expert Group “Exchange of best practices on minerals policy and legal framework, information framework, land-use planning and permitting” to compare the existing Member States’ raw materials policies and share their good practices, to identify gaps, make recommendations and improve these policies where needed . From the last report (AHWG, 2014), it became clear that some EU Member States do not have national minerals policies in place yet; even where they exist, these policies are not always aligned with the other policies affecting the industries. There are Member States with traditional, single, all-material inclusive specific codes for extractive activities (Germany, Austria, Hungary, France, and Spain). Elsewhere, hydrocarbons are treated separately (Romania), or geological research has a distinct law. In some Member States, aggregates are regulated by land-use planning laws (United Kingdom, the Netherlands). In a few new Member States, mining codes have no “mining” in the title, but the term “sub-surface resources” or “sub-soil” is used instead, and their content covers geo-space utilisation as well (Bulgaria, Estonia, Latvia). Finland is mentioned for interesting good-practice examples on the policy and legal frameworks, as its original definition of a national strategy has been extended to encompass an action plan. This has been developed and, based on it, both government and the NEEI will implement an agreed upon programme in order to meet ambitious national objectives by 2019, and long-term objectives up to 2030.
Fostering access to mineral potential
A precondition for the use of domestic sources is access to deposits. As mentioned above, European potential is under-exploited and areas with a high potential could be hindered by competition from other land uses, such as agriculture, forestry, housing or industrial zones. Thus, the area available for extraction in the EU is constantly decreasing and the biggest competitors in land use, like building, can dissipate potential deposits for future use for mining activities. Therefore, with regard to land use planning and marine spatial plans, the EU aims to ensure that the NEEI is considered on equal terms with all other competing sectors. This would guarantee an appropriate time frame for long-term investments in minerals extraction, processing and refining.
To this end, the importance of certain mineral deposits at each of the different levels (local, regional, national, EU) should be confirmed. Land use plans at different levels (local, regional, national) should be better co-ordinated and linked to the general rules and guidelines for minerals land use plans, and cover potential as well as current and past extractive areas. These rules and guidelines should include tools and mechanisms for forecasting the long-term supply of raw materials that are important at local, regional, national and EU levels in view of their foreseen demands.
Land-use planning procedures are long term and NEEI activities are frequently considered as a hazard for the environment, rather than as an economic activity that is only temporarily using land. Mining for non-energy minerals tends to receive a relatively low ranking compared to other land uses, such as urbanisation, agriculture, recreation, etc. (EIP, 2013). So, in 2014 the Commission proposed developing an appropriate mapping framework with the detailed definition and qualifying conditions for the concept of Mineral Deposits of Public Importance (MDoPI), covering all minerals but with stress on the occurrence of critical minerals, defining deposits of local, regional, national or EU interest and considering how to safeguard them. MINATURA 2020 is the project that answered to the proposal, with a partnership of 24 organisations from 19 countries (including three non-member states: Bosnia and Herzegovina, Montenegro and Serbia). In 2018, it will provide an agreed upon definition for MDoPI with a guidance document on how to incorporate it into mineral and land-use policies, as well as a set of qualifying conditions for a Harmonised Mapping Framework (HMF) for each type of mineral and a report on testing results in selected case-study countries. A bottom-up approach has been adopted to find the best compromise from amongst different existing protocols and standards.
Developing public awareness, acceptance and trust
Public acceptance is a precondition for the development of any economic activity. It is even more important for the extractive industry, given the evident environmental and social concerns at both European and global levels. Public acceptance of extractive industries in the EU compared with other economic sectors is low, meaning that much can still be done. According to surveys amongst the European general public on their trust in the commitment towards society by companies from various sectors, mining and oil & gas companies are perceived as making the least effort to behave responsibly towards society: 55% of respondents stated that companies working in mining and oil & gas do not make sufficient efforts to behave responsibly. Initiatives for corporate social responsibility (CSR) are already becoming more common and the EU has emerged as an international leader on sustainability reporting (EC, 2016).
The EU, on its side, includes in the second pillar strategies on Public Awareness, Acceptance and Trust (PAAT), designating campaigns on information and education, and promoting best-practice examples of communication for stakeholders that are particularly tailored for European conditions (such as social and cultural backgrounds and landscape integration).
Public perception can be distorted by prejudices, so preventive measures are helpful in gaining trust. Transparency and communication boost local awareness about the role of raw materials in the economy and for employment. Through reports and commitments to voluntary codes, the development of modern mining and good governance models can be explained and proved, thus increasing public acceptance (EIP, 2013). A good example is the Finnish Network for Sustainable Mining, with members from various sectors such as agriculture, forestry and nature conservation aiming to develop an open and continuous dialogue between the mining industry and its stakeholder constituency. Based on voluntary action and self-regulation, the network provides tools for planning mining activities in specific regions, issues corporate social responsibility reports and is working to develop a new sustainability standard for ore exploration.
Public acceptance is strongly linked to both the above-mentioned policy framework conditions and access to minerals potential. Open project proposals under Horizon 2020 for raw materials policy support actions including the creation of an “EU network of mining and metallurgy regions”, a network aiming at improving related framework conditions, industrial competitiveness and also social aspects of mining activities. More specifically, the project should focus on the definition of guidelines for a Social Licence to Operate (i.e. the level of acceptance or approval by local communities and stakeholders of mining companies) to combine with governmental licences, communication activities and the involvement of the entire stakeholder community, including regional authorities (EC, 2016).
The three main axes presented here are included in the Raw Materials Initiative and comprise one of the three pillars on which the Raw Materials Initiative is based. In fact, actions to foster the sustainable supply of raw materials inside the European Union are included in the Second Pillar and are promoted, alongside actions of the Third Pillar, to improve resource efficiency and recycling. Similarly, they are profiled together with actions of the First Pillar to ensure a fair and sustainable global market, such as through international dialogues and diplomacy with key countries producing raw materials. The three pillars together form the basis for achieving competitiveness and growth, not only for the raw materials sector, but also for the whole EU economy.
Ad Hoc Working Group on exchange of best practices on minerals policy and legal framework, information framework, land-use planning and permitting (AHWG). 2014. Recommendations on the framework conditions for the extraction of non-energy raw materials in the European Union. https://ec.europa.eu/growth/sectors/raw-materials/policy-strategy/sustainable-supply-eu_en
European Commission. 2008. Communication from the Commission to the European Parliament and the Council: The Raw Materials Initiative — meeting our critical needs for growth and jobs in Europe, COM(2008)699.
European Commission. 2016. HORIZON 2020 – Work Programme 2016 – 2017 Climate action, environment, resource efficiency and raw materials, Decision C(2016)4614.
European Commission. 2010. EC guidance on undertaking non-energy extractive activities in accordance. http://ec.europa.eu/environment/nature/natura2000/index_en.htm
European Commission. 2016. Raw Materials Scoreboard.
European Innovation Partnership (EIP). 2013. Strategic Implementation Plan for the European Innovation Partnership on Raw Materials (Final Version).
Ferguson M. et al. 2015. Corporate Exploration Strategies 2015 — Exploration Budgets by Location, 2015; Part 1: Overall Trends, Canada, Australia and United States. SNL Metals and Mining.
Finnish Network for Sustainable Mining. http://www.kaivosvastuu.fi/.
Jackson, T., and Kenneth P. G. 2015. Fraser Institute Annual Survey of Mining Companies, 2014. Fraser Institute. http://www.fraserinstitute.org .
MINATURA 2020. http://minatura2020.eu/ .
MINLEX study – Legal framework for mineral extraction and permitting procedures for exploration and exploitation in the EU. http://www.minlex.eu/permitting.html
Volker, Z., Simons, J., Reller, A., Ashfield, M., Rennie, C. 2014. Materials critical to the energy industry — an introduction. BP.
This article has been published in European Geologist Journal 42 – International cooperation on raw materials.
Read here the full issue: