How the first Mining Day was held: main points and photos

On September 22, a special industry event – Mining Day, organized by the Subsoil Use Committee of the European Business Association (EBA), took place.

Geological Investment Group has become a partner of Mining Day.

The event brought together main market players, government officials, international partners and industry experts to discuss the state and prospects of the industry, the progress of reform, the impact of military activities and the necessary steps to proceed with the sustainable development of subsoil use in Ukraine.

Among participants: Ruslan Strilets, Minister of Environmental Protection of Ukraine, Yevhen Fedorenko, Deputy Minister of Environmental Protection of Ukraine, Oleh Bondarenko, Chairman of the Verkhovna Rada Committee on Environmental Policy and Natural Resources, and Roman Opimakh, Chairman of the State Service of Geology and Subsoil of Ukraine.

Specifically, according to representatives of state authorities, the subsoil use reform that began six months ago is already yielding its initial results.

In addition to improving legislation in the field of subsoil use, implementing European directives remains a priority task for parliamentarians.

Within the framework of industry panels, experts also highlighted various aspects, opportunities, and challenges of the subsoil use market in Ukraine.

During the discussion panel “Investments in Subsoil Use: Prospects and Opportunities”, the advantages of Ukraine in the field of subsoil use were discussed. According to Dmytro Kashchuk, Director of Business Development at Geological Investment Group and Chairman of the EBA Subsoil Use Committee, if we assess the domestic subsoil use market, despite the full-scale invasion, we observe that local businesses are investing funds in Ukraine, creating new jobs, and believing in the future of their country.

“We know what is crucial for businesses, and these policies must include fiscal and tax incentives for business, partial subsidies, regulatory relief, as well as support at the level of export-credit agencies. Equally important in this situation is long-term financing for businesses. This will help accelerate the development of important deposits of critical raw materials, which may currently seem daunting for Ukrainian investors. As the Subsoil Use Committee of the European Business Association, we are doing a lot in this regard,” Dmytro Kashchuk said.

During the third discussion panel, the challenges and their potential solutions in the field of subsoil use were discussed. The discussion was moderated by the founder and CEO of the Geological Investment Group, Iryna Suprun.

“The subsoil use sector, since the onset of the full-scale war, has encountered serious challenges: a reform in subsoil use that radically changed the rules of doing business, the absence of a developed policy in Ukraine regarding the processing of raw materials, changes in supply chains of raw materials due to the full-scale war and issues related to railway access, reservation of workers, lack of personnel due to the outflow of people (especially from central and eastern regions), problems with electricity supply due to constant shelling, etc. All these circumstances require absolutely new and bold solutions, which are not always feasible without the support of partners and the state,” summarized Iryna Suprun.

 

As part of the organization for Mining Day, the European Business Association conducted a survey among the subsoil users who are members of the EBA Subsoil Use Committee.

Therefore, according to the survey results, 74% of the companies surveyed continued to invest in Ukrainian subsoil during the war, 18% have not yet made an investment decision, and only 8% are currently not investing.

Moreover, 82% of respondents consider the subsoil use sector to be investment-attractive, rating Ukraine’s resource potential at 7.85 out of a 10-point scale. According to business opinions, the minerals with the greatest potential in Ukraine and globally are titanium, lithium, hydrocarbons (oil, gas, condensate), and iron ore.

The majority of companies, specifically 61%, have invested up to 5 million dollars/euros in Ukrainian subsoil since the beginning of the full-scale invasion, while 21% have invested more than 5 million dollars/euros. High risks for international investment, coupled with problems in energy supply and logistics difficulties (lack of access to ports and complications in railway transportation), are considered by businesses to be among the top three challenges during wartime. At the same time, 51% of respondents agree that risk insurance by international companies (DFC/MIGA, etc.) against capital loss during and post-war would stimulate investment in subsoil use.

The regulatory environment in the subsoil use sector is rated as satisfactory by the majority of enterprises, specifically 63%, while 11% rate it as good. At the same time, 26% consider it unsatisfactory. The reform of the subsoil use sector received a rating of 6.26 out of 10 from entrepreneurs. Concurrently, a high-quality regulatory environment, protection of property rights, and foreign investments could already be stimulating the development of the sector.

The full-scale invasion of Ukraine by Russia has impacted the business activities of most companies. Specifically, the activities of 54% of companies were halted but have now been fully or partially restored, while the activities of 18% of companies remain completely suspended. Only 28% of the respondents did not feel the impact of the military actions.

It is also worth noting that within a year of its operation, the Subsoil Use Committee has seen the inclusion of some of the best mining companies in Ukraine. Active work is being carried out to establish communication with state authorities and to form market policies that will help Ukraine become a country with processing capabilities and an important geopolitical player in the development of strategic minerals.