Czech Republic Mining Report 2012

The Czech Republic's mining sector is set to undergo declines until 2013, before seeing modest gains until 2016, when its value will reach US$2.9bn, on a par with current levels. The initial decline will be driven by falling uranium production, before coal and gold production drive growth from 2013. Given our outlook for growth in the wider economy of the Czech Republic, we expect the mining sector's share of GDP to continue falling over the next decade from 1.2% in 2010.
The Czech Republic will remain one of Europe's largest coal producers as the country remains reliant on domestic coal output for energy generation. Whereas output from much of the rest of Europe is in decline, we forecast modest growth in Czech coal output, reaching 62.4mn tonnes in 2016. Coal is the foremost indigenous raw material for energy in the Czech Republic with estimated reserves of 2bn tonnes. It accounts for the majority of domestic energy consumption with approximately 61% of the country's total electricity output being generated by coal-fired power stations. The Czech Republic produced 55.3mn tonnes of coal in 2010, making the country one of the largest producers in the EU.
Meanwhile, amid dwindling brown coal supplies, which is hitting the Czech Republic's heating companies harder as contracts with miners come up for renewal, the Ministry of Trade and Industry (MPO) is mulling over proposals that could give domestic companies state support in acquiring coal mines or miners overseas. The proposals were discussed in June 2011, but few details are available.
The Czech Republic's uranium sector is set to decline as falling grades, lower uranium prices, and public and political opposition to nuclear power weigh on the sector. The Czech Republic ranks seventh among the world's leading uranium producers after Canada, the US, Germany, South Africa, Australia and Russia. The other two large Czech uranium sites, Straz pod Ralskem and Hamr in northern Bohemia, contain up to 115,000 tonnes of uranium ore. However, both the mines went into bankruptcy in the mid- 1990s. The government has announced plans to keep mining at Rozna and possibly restart uranium mining at other sites. It is aiming to be less dependent on foreign sources of uranium, and high demand for uranium in world markets also favour the reopening of the uranium operations.
The Czech government's willingness to build nuclear power capacity as other European governments become reticent on the source has only added to the Czech Republic's incentives to pursue uranium. The prospect and price of supplying neighbouring European countries looking to fill future power deficits, along with one of the world's largest uranium reserves, are formidably persuasive factors for uranium mining expansion that opponents will find difficult to counter.