site.btaAudit Finds Slack Control of Chelopech Gold Mine Concession

Audit Finds Slack Control of Chelopech Gold Mine Concession

Sofia, July 27 (BTA) - The National Audit Office announced Wednesday the conclusions of an audit at the Chelopech ore and copper mine, which has found slack control over the concession owned by the mine operator, Dundee Precious Metals Chelopech. The audit covers the period from 2011 to the end of 2013.

The 30-year concession for the Chelopech mine was signed in 1999. By 2009 it was revised and supplemented on four occasions. The very first of these changed the terms set out in the government decision for awarding the concession and the requirements for minimum investment and for environmental protection measures were lowered, as was the period for their implementation (from five to three years).

In this way the concession authority lost contracted investment to the amount of 37 million US dollars, the auditors found.

The concession royalty for the audit period stood at over 22.6 million US dollars - some 33.8 million leva - which the operator paid up in due time as per the concession agreement.

Of the royalty it had received, the State paid 14.7 million leva to the Municipality of Chelopech and over 1.7 million leva to the Municipality of Chavdar.

The investments made by the concession owner during the audit period were in excess of 187.5 million US dollars.

The information provided to the auditors led them to doubt that any on-the-spot checks were made by the control authorities in 2011 and 2012.

The audit report has five recommendations to the Energy Minister which need to be fulfilled over a period of four months.

The full audit report is available at www.bulnao.government.bg.