Andrew Prelea (Vast Resources): We plan to invest in other mines from Romania

Newsroom 17/06/2016 | 17:50

Andrew Prelea, the  president & executive director of Vast Resources has told BR in an exclusive interview that the company is planning to invest in other mines from Romania, because he believes that there are vast opportunities here in this sector.

Georgiana Bendre

Do you bring only your own the capital for investment or did you obtain also capital investments from other parts, such as EU funds?

To date Vast has invested over USD 7mil in Romania through its Romanian subsidiary from its own capital.

In respect to obtaining funds from other parties, we are currently in the process of applying for EU funds for specific research projects with Universities, to assist in the mining sector with a view to commercializing Romanian technology in the field.

Do you have any future investment plans in Romania? Are you looking to buy other mines?

Yes, I can say that Vast Resources has big plans for Romania. We are currently investing in upgrades at the processing plant in Iacobeni for the mine at Manaila and are commencing the prospecting drilling programs in Quarter three to extend the mine perimeter. There is an intensive investment program for the mine planned for 2017 once we have completed the prospecting and verification drilling works with a view to extend the life of the mine.

At Baita we are currently focusing on making the mine safe and upgrading the safety aspects of the mine, as well as maintaining the underground works.

We are also looking at other mining investment opportunities as we have a long term approach to Romania and believe that there are vast opportunities here in the sector.

Which was the revenue last year brought by the investments in Romania?

Last year was the startup year of production, upon taking possession of Manaila in July, we spent 3 months fixing the open pit and repairing the production facility. As a result, we commenced working on production in October for November and December deliveries and the revenues for this period were approximately USD 545,000.

How many employees do you have at the moment in Romania?

At the head office in Bucharest, Manaila and Baita we have over 220 employees and once we receive the association on the license in Baita the numbers will immediately grow to 300. However, once we reach full production in 2017, the number of employees will further increase by 100-150 people.

How does Romania position compared with other countries where you activate in terms of resources and profitability?

Every country has different issues to deal with, culturally and, of course, in resource. In Zimbabwe our gold mine is working very well and producing regular income with good profits. The mining sector there, despite the countries difficulties, had a continuing mining culture, so it was easier to restart the mine and build the production facilities. The difference with Romania is that we are working with polymetallic ore that requires a different skill sets and processing methods and we have had a pause of over 10 years in the sector, so we need to work harder to restart the processes.

The resources themselves are plentiful in both countries and have massive potential. Each jurisdiction has its benefits and difficulties and has opportunities to make respectable profits.

What do you think about the local legal framework in the mining sector?

At the moment this is the greatest hurdle in investment in this sector and needs to be reevaluated if Romania is to attract large investment in mining.

The mining sector in Romania has huge potential to attract foreign investment and although the mining sector is a high risk industry as far as resource and recovery of the production, these are calculated risks that mining companies are willing to take, but legal risks and delays are something that should be able to be controlled.

What other minerals do you extract apart from ore?

In Manaila, as it is a polymetallic mine, we extract predominantly copper but the ore body has other metals contained. We are currently recovering in our concentrates mostly Copper, Zinc, and Lead. Gold and silver are present too, but in minor quantities.

Once we finalize the Zinc and Lead floatation lines this month, we will be selling a separate zinc concentrate.

Where do you sell the extractions from Romania?

Unfortunately once the mining activities stopped in 2006/2007, all of the peripheral activities closed as well, so we do not have smelting facilities left in Romania to add value to the resources. Therefore, we are currently exporting to Holland.

In time, as the industry grows, there will be opportunities to open smelting facilities back here as well so and we will be able to sell on the local market again.

 

 

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