Mineral Raw Materials and Spatial Planning

Sustainable supply and use of mineral raw materials is considered crucial for economic stability and prosperity. Securing access to land for mineral exploration and extraction in an integrated and optimized process is therefore of great importance and one of the main challenges the extractive industry is facing today. At the same time, given the distrust of the local communities towards mining activities, prior assurance of social consensus and acceptance is an important factor for the smooth development of the latter.

The need for the rational supply and use of natural resources is one of the issues requiring the regulatory intervention of the state at local, regional and / or national level.

The legal provisions incorporated in the Greek Constitution (Art. 106 and 18) and the Mining Code underpin the significance of Mineral Raw Materials (MRM) for the country and the need to safeguard them for the benefit of national economy.

The National mineral policy also addresses safeguarding or protection of mineral deposits and prospective areas in the 2nd Policy Axe of the Policy’s document as follows: “Adequate land-use planning that shall ensure the possibility of access to the MRM deposits and contribute to the resolution of issues related to the competition of different land uses”.

Nevertheless, these provisions are not sufficient for safeguarding MRM. In practice the MRM exploitation is usually the result of a compromise between the environmental, mining, rural and urban development legislative provisions and development priorities of the Administrative Region.

The Greek state, recognizing the need to safeguard MRM, announced in 2018 the elaboration of a “Special Spatial Plan for the Mineral Raw Materials”. This plan builds on the efforts of the public administration to develop a policy for the spatial arrangement of the extractive sector, based on the sustainable development principles.

The aim of the “Special Spatial Plan for Mineral Raw Materials” is the development of a policy for the spatial arrangement of the extractive activities, based on the sustainable development principles. It will encompass the main directions for the spatial planning of the extractive sector in accordance with the existing land use planning and it will be harmonized with the National Strategy for the strategic planning and development of the country’s mineral wealth.

The elaboration of the “Special Spatial Plan for Mineral Raw Materials” will bring further benefits regarding the issue of protecting mineral resources. The expected benefits pertain to:

–  The generation of a framework to which, all the Spatial-Development frameworks of the regions and municipalities, regarding the development of exploitable Mineral Raw Materials (MRMs), will be compatible with.

–   The facilitation of exploration licensing and exploitation permitting of MRMs through the creation of a framework that will clearly establish the areas of existing exploitable deposits on national level as well as the broader areas for MRMs prospecting, thus, reducing the time and the current bureaucratic permitting processes, especially in relation to important investment initiatives.

–   Enforcement of the principles of legal certainty, a prerequisite to attract investments.

The elaboration of the plan is still in progress. The timeline of its implementation according to the 2022 amendment has been extended to the end of 2023.

Administrative structure of Greece

A significant number of competencies regarding permitting of mining and quarrying activities are transferred from the central state (Ministries) to the de-centralized levels of governance. For this reason, it is important to present here briefly the administrative structure of Greece. According to “Kallikratris” (L.3852/2010 as amended and valid), Greece is divided in seven (7) De-centralized Administrations (Apokentromenes Deikisis) and thirteen (13) Administrative Regions or Regional Administrations (Peripheries) which are further divided in 325 Municipalities (Local Authorities). Administrative Regions and Municipalities are self-governed legal entities and subsequently the respective authorities running these bodies are elected by the registered voters.  Each De-centralized Administration has major task to ensure the implementation of the state policies at regional level and includes in its jurisdiction 1 to 3 Administrative Regions. The Head of the De-centralized Administration is appointed by the State with the mandate to implement the governmental guidelines at regional level.

Municipality (Demos) is the first-degree unit of local / regional authorities governed by the Mayor and the Municipality Council and are elected every 5 years. The second-degree unit of local / regional authorities is the Administrative Region (Periferia) which covers a much broader geographical area of the country than Municipality. It is run by the Regional Governor (Periferiarchis) and the Regional Council who are elected every 5 years. Each Region is (geographically) divided in “Regional Units” (Periferiakes Enotites) which in most cases coincide with the formerly called Prefectures (Nomoi). The 13 Administrative Regions (Peripheries) and the 7 De-centralized Administrations to a lesser extent, include in their jurisdictions services that are involved in the permitting/licensing process of mining projects and activities.

De-centralized Administrations of Greece: Ministry of Interior (ypes.gr)

Administrative Regions official websites:
https://www.enterprisegreece.gov.gr/en/synergassia-regional-compass/official-regions-websites

Overview of the extractive sector

Introduction

Greece is currently exploiting several mineral raw materials such as perlite, bentonite, magnesite, bauxite, gypsum, calcium carbonate (both from primary resources and marble residues), marble, mixed sulfide and nickeliferous ores. It preserves a high position globally and in Europe with regards to perlite, bentonite, magnesite, and bauxite (crude ore) production. In 2020 it ranked in lead position for perlite, bentonite, and crude bauxite production out of 3, 16 and 5 european producers respectively (Table 1.2-1).

Table 1.2-1: Mineral production – Ranking of Greece (Source: World Mining Data (WMD) reports 2017-2022)

The entrepreneurial activity of the sector is geographically distributed all over Greece. Most of the non-energy mining enterprises are operating in the Administrative Regions of Sterea Ellada, Central Macedonia and Macedonia-Thrace (central, north, and northeast Greece). The latter also gathers the core business (more than 80%) of marble producing companies while production of significant industrial minerals, such as bentonite and perlite prevails in the Administrative Region of South Aegean (Milos Island). The Administrative Regions of Western Macedonia in the northwest and Peloponnese in the south are the most important production centers of lignite.

The Greek extractive industry is a strongly export oriented industrial sector with a clear competitive advantage in certain market segments. According to a 2018 study conducted by the Foundation for Economic and Industrial Research (IOBE), the exports-to-sales ratio from 2010 to 2016 remains high with the exports value approaching the 50% of total sales (over 75% of total exported products). This ratio in 2016 is close to 90% for marbles and industrial minerals and around 75-80% for metallic minerals and metals. Based on the same study, the overall contribution of the extractive sector to the GDP is estimated to be 2,3% (3,9 billion euros). If energy production based on lignite is considered, the extractive sector’s contribution raises to 3,1% of GDP (5,4 billion euros) (https://www.sme.gr/wp-content/uploads/2019/09/symboli-tis-exoryktikis-biomihanias-ekthesi-2015-2017.pdf).

As acknowledged in the 2020 report ‘Development Plan for the Greek Economy’, conducted by the Christoforos Pissarides committee, a more complete verticalization and specialization of the production processes is needed, utilizing domestic mineral raw materials, to maximize the added value produced through the specific economic activity (https://government.gov.gr/schedio-anaptixis-gia-tin-elliniki-ikonomia/).

The National Recovery and Resilience Plan “Greece 2.0”, approved by ECOFIN on 13 July 2021, includes 106 investments and 68 reforms, utilizing investment resources of 31.16 billion euros, of which 30,5 billion European funds  (18.43 billion euros in grants and 12.73 billion euros in loans) and will mobilize a total of 60 billion euros in investments in the country over the next five years (https://greece20.gov.gr/en/the-complete-plan/). According to the Association of Mining Enterprises (SME), the incorporation of the extractive sector’s activities in this plan is anticipated to mobilize significant investments that in turn may further boost exports.

The Extractive Industry in Greece is mainly represented by two major Associations, the Association of Mining Enterprises (SME), with 29 registered member companies (https://www.sme.gr/), and the Marble Industry Association of Macedonia – Thrace  with more than 60 registered marble producing companies (https://www.semmth.gr/).

Production, exports and employment

A more detailed overview of the Country’s extractive sector in terms of production, exports, value of exports and employment variations is included in this section. The following sources were mainly used:

• Data processed and published by the Ministry of Environment and Energy in the annual reports of 2019 and 2020 (https://ypen.gov.gr/wp-content/uploads/2021/02/%CE%95%CE%9A%CE%98%CE%95%CE%A3%CE%97-2019-.pdf) and (https://ypen.gov.gr/wp-content/uploads/2022/07/%CE%95%CE%9A%CE%98%CE%95%CE%A3%CE%97-%CE%9F%CE%A0%CE%A5-2020.pdf);
• The World Mining Data (WMD) reports 2017-2022 (https://www.world-mining-data.info/?World_Mining_Data___PDF-Files)
• Data published by the Association of Mining Enterprises (SME) in the Activity Report 2020 Report-of-activities-2020.pdf (sme.gr), and
• The Sectoral Study Marble – Granites published by ICAP in 2021.

A snapshot of the current extractive sector’s status is given in SME’s Activity Report 2020 issued in 2021. Based on this report, 76.000 are estimated to be directly and indirectly employed in the sector. Employment presented a 10% reduction, as compared to the 2019 figure. The 2020 production of final commercial products was 63,2 Mt, reduced by 20% as compared to 2019. Finally, sales and exports in 2020 were 1,38 and 0,69 billion of euros respectively, both reduced by 30% as compared to the relevant 2019 figures. These variations were due to the severe shrinkage of lignite production (transition to other energy sources), the reduced Ferronickel production by LARCO GMMSA (the Greek nickel producer that was put under special administration and reduced production status), as well as the consequences of the COVID19 pandemic.

With regards to the member companies of the Association of Mining Enterprises (SME), 12.117 people were employed in both direct and indirect job positions in 2020 (-1,2% compared to 2019) and produced 47,2 Mt of final commercial products (-19% compared to 2019). During the same year, the sales, and exports in billion euros were 1,2 and 0,7 respectively (-25% and -20% compared to 2019). The observed drop-offs in 2020 as compared to 2019 are attributed by SME to the same reasons mentioned above Report-of-activities-2020.pdf (sme.gr).

Most of the marble producing companies and members of the Marble Industry Association of Macedonia – Thrace are in the wider area of Macedonia-Thrace in which 80% of the total Greek primary marble production takes place. 150 companies are active in the field employing around 6.000 people (in both direct and indirect job positions). The Administrative Region of Eastern Macedonia-Thrace hosts five (5) marble quarry centers with more than 135 quarries operating and covering over 90% of the country’s exports in quantity and value (https://www.semmth.gr/).

Based on WMD data, the mineral production figures for the years 2015 to 2020 are presented in Tables 1.2-2 and 1.2-3, by production in Metr.t and by value in Million USD respectively. Commodities are grouped in the following categories: Iron, Ferro – Alloys; Non-Ferrous metals; Precious metals; Industrial minerals; Mineral – Fuels; Bauxite (crude ore). These groups are further analyzed into specific commodities. Their production figures for the period 2015-2020 are presented in Table 1.2-4.

The Mineral-Fuels production corresponds mainly to lignite extraction which is in decline since 2015. This is not due to depletion of lignite resources. To combat climate change, Greece is aiming to gradual transition to other energy sources by 2028. As stated in WMD reports, metals’ mineral production figures do not refer to crude ore (ROM/run of mine) or concentrate produced from it (unless otherwise stated) but indicate the content of recoverable valuable elements and compounds.

Table 1.2-2: Total minerals production of Greece for the years 2015 to 2020, in Metr. t (Source: World Mining Data (WMD) reports 2017-2022)

Table 1.2-3: Total minerals production of Greece for the years 2015 to 2020, by Value in Million USD (Source: World Mining Data (WMD) reports 2015-2022)

Table 1.2-4: Commodities’ production in period 2015-2020 in Metr. t, unless otherwise stated (Source: World Mining Data (WMD) reports 2017-2022)

In 2020, a decline in production of Iron, Ferro – Alloys group is observed, compared to the average production in the preceding years. The production of non-ferrous metals remains stable for the same period while their slight production increase from 2018 onwards may be attributed to the substantial increase of mixed sulfides production. The bauxite production declines slightly from 2018 onwards compared to figures of the preceding three years period (Table 1.2-4).

Table 1.2-5: Production of processed Metallic Minerals or Ores during the period 2016-2020, in Metric t., unless otherwise stated (Source: Mining and Quarrying Activity in Greece, YPEN Annual Report 2020)

Metallic Minerals or Ores’ production in 2020 presents noticeable fluctuations. Production of mixed sulfides shows an increase of 55% while domestic production of lignite and laterites shows a decrease of 50% and 46% respectively as compared to 2019 figures. Extraction of bauxite and production of alumina and aluminum products shows a relative minor increase (Table 1.2-5).

Table 1.2-6: Industrial minerals production during the period 2016-2020, in Metric t., unless otherwise stated (Source: Mining and Quarrying Activity in Greece, YPEN Annual Report 2019 and 2020)

Table 1.2-7: Marble production, exports, and value of exports during the period 2015-2020 (Source: Sectoral study Marble – Granites, ICAP, 2021)

Table 1.2-8: Aggregates production during the period 2016-2020, in Metric t., unless otherwise stated (Source: Mining and Quarrying Activity in Greece, YPEN Annual Report 2020)

As already mentioned, the industrial minerals and marble sectors are strongly export-oriented. The export fluctuations over a 5 years’ period for four significant domestically produced industrial minerals are presented in Fig. 1.2-1.

Fig.1.2-1: Production-exports of four industrial minerals (perlite, bentonite, gypsum, and calcium carbonate) for 2015-2019 (Source: Mining and Quarrying Activity in Greece, YPEN Annual Report 2019)

With regards to employment, the variation of the extractive’s sector workforce from 2010 to 2020 per mineral category is shown in Fig. 1.2-2. The number of employees in the mining sector since 2014 decreases steadily except of the observed slight increase from 2016 to 2017. In 2020 we observe a further decrease of 12,5% compared to previous year. This decrease is attributed to the consequences of COVID19 pandemic and shrinkage of lignite production. Fluctuations are observed in the marble and aggregate producing quarries while the relevant numbers in the industrial minerals sector remain quite stable since 2012.

Fig.1.2-2: Variation of the workforce directly employed in the extractive sector in 2010-2020 (number of persons per year) (Source: Mining and Quarrying Activity in Greece, YPEN Annual Report 2020)

General information

National mineral policy

The Greek State’s principal policy regarding mineral raw materials is declared in article 106, paragraph 1, of the Greek Constitution of 2008: “Mineral raw materials are considered to be sources of national wealth and hence the State shall, for the sake of the public interest, take measures for their utilization, promoting regional development and particularly for the enhancement of the economy in mountainous, insular and border areas”. The National Policy (NP) for the strategic planning and exploitation of the mineral resources, announced in 2012, acknowledges the importance of the Mineral Raw Materials (MRM) that contribute to progress and development, ensure a high living standard and create a competitive national and regional economy and new job positions.

The main axes of the NP are:

1. The national policy about the Mineral Resources as a basic component of the national and regional development policy of the Country.
2. Adequate land-use planning that shall ensure the possibility of access to the MRM deposits and contribute to the resolution of issues related to the competition of different land uses.
3. Codification and modernization of the quarry/mining legislation (licensing system, exploration and exploitation, H&S control, environmental issues etc.
4. Promotion of dialogue – Acceptance by the local society.
5. Education-Research – Innovation.
6. Efficient use of MRM including substitution, reuse, recycling and use of by-products/waste of mining processes, tailings ponds waste and metallurgy waste. The aim is to ensure a rational management and minimization of all mining waste.

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