SME AG

After years of intensive proceedings, planning permission under mining law has been granted for the Pöhla ore mine project, with effect from 30th September 2024. As requested, the permission is limited to a period of 70 years. Saxony Minerals & Exploration AG (SME AG) has been active in the Ore Mountains since 2016, more precisely in the Schwarzenberg district of Pöhla, and is now ready to start construction of the ramp and mining of the ores via the ramp, now that the conditions have been clarified.

Apart from Wismut AG, SME is the first ore mine to be approved, constructed and put into operation as a completely new mine in Germany since the end of the war. The company, based in Halsbrücke in the district of Mittelsachsen, is in the process of establishing itself as an expert in the extraction of so-called free-to-mine natural resources such as tungsten, fluorite, tin, indium, nickel and other ores in Saxony. Some of these, in particular the sought-after tungsten, were explored by SME geologists in an old mining area near Pöhla-Globenstein. Based on this find, the SME experts decided to resume and continue the great history of ore mining in the Free State, which spans over 800 years, in the present day and under modern conditions.

In 2017, an exploratory shaft was sunk to a depth of 180 metres, which made it possible to extract several thousand tonnes of ore. This material was processed in SME’s pilot processing plant in Mittweida, which demonstrated the economic separation of tungsten and fluorspar, among other things.

The data basis for the SME project consists of existing historical surface drillings of over 125,000 m and the construction of 16 km of tunnels, which represent a current investment value of 180 M €.

The EU and the German government have recently introduced an agenda for the promotion of domestic raw materials as part of their raw materials strategy, with the aim of minimising dependence on foreign countries. SME is currently in the application process with the relevant institutions (KFW).

Klaus Grund, the member of the Management Board responsible, emphasises the positive cooperation with the Mining Authority (OBA): “We are very satisfied with the result and are pleased to now have the important planning security for mining in the Ore Mountains. There are justified hopes and expectations for the region with regard to the creation of new jobs. Furthermore, the project is highly relevant in view of the sharp global increase in prices for numerous ores and rare earths, as the corresponding mineral raw materials from mining play an important strategic role in securing the economy and independence in critical supply situations.” (SME/Si.)

At the end of May 2019 the exploratory shaft of Saxony Minerals & Exploration AG (SME), Halsbrücke/Germany, above Pöhla, reached the tungsten deposits 175 m deep. A horizontal tunnel is currently being dug in order to mine even more ore from deposits. Since the beginning of September the pilot system for processing the ore mined from the shaft is now also running. The system, located in the Mittweida industrial park Lauenhain, digs out the tungsten rock delivered from Pöhla and also fluoride, also called fluorspar. As soon as the actual processing plant assumes its work on the mine site in Pöhla-Luchsbachtal, the operation of the pilot system in Pöhla ends and it is removed. It is then used again as an additional installation in Luchsbachtal.

“It is definitely a good decision that we played through the ore processing in a pilot system first”, reports Klaus Grund, Mine Surveyor, also on the Planning, Technology and Strategy Board of the SME. “Here in Mittweida we are continuously optimising the treatment process and thus collecting important experiences, which help us in Pöhla to apply the best method. The determination of the perfect processing method is complex as in Germany polymetallic rock was last processed in 1988. As we are dealing with a polymetallic rock mixture, we naturally use degradable substances that are not in danger of contaminating the drinking water supplies in order to liberate the ores. We are currently improving the exact formula of the reagents.”

The use of the process has been carefully examined and approved by the responsible authorities of the district administration. “In contrast to the typical processes in the GDR era, when very strong acids were used, we pay close attention to environment protection and only use degradable substances”, adds Grund. A three-shift system is in place at the Mittweida plant with six workers on each shift. SME can process 3,000 t of rock in Mittweida up until the end of the approved system runtime at the start of September 2020.

A worthwhile venture because in the Pöhla extraction site significant reserves of tungsten, fluorite and tin await with a value of over 700 M €, proven by numerous explorations, including also in the GDR era by Wismut. In order to cover the enormous investment need of an underground mine incl. processing, SME has been issuing 5.5 year corporate bonds at an interest rate of 7.75 % since the middle of October this year.

“Not least because of the high raw material content, we will be in the top 25 % of tungsten mines in the world as far as costs are concerned and can therefore operate extremely competitively. We also help reduce Germany’s dependence on raw material imports”, says Grund. “Our bond is therefore not only a good investment, but it also supports Germany’s strategic interests.” (SME/Si.)

After the Saxony Minerals & Exploration AG (SME AG) exploratory shaft in the Luchsbachtal Valley near Pöhla/Germany in the Ore Mountains has reached its final depth and preparations to exchange the previously leased hoisting winches for owned winches are in full swing, the comprehensive approval process for the planned mining installations and for the necessary spoil tip continue to run in parallel. In the context of the required general operating plan and regional planning procedures, specialist environmental planners from the Pirna/Germany based company “Schulz UmweltPlanung” have been commissioned by SME and have now compiled the required environmental impact assessment, the planned conservation and compensatory measures and a plan for the rehabilitation of the site following the end of mining activities. Further species surveys are currently being conducted.

Especially against the background of the imminent visit by Vice President of the German Federal Parliament Katrin Göring-Eckardt (MdB B90/Grüne) and today’s comments by Stephan Kühn (MdB B90/Grüne) in the “Freie Presse” newspaper, which juxtaposed “maximum profits for mining companies against maximum losses for residents and nature,” the company has been unjustly discredited. “We have invested lots of time and commitment and the specialist knowledge of the top environmental experts in the Free State of Saxony, as well as – in association with this – money, of course, in conforming with all legal requirements relating to conservation and to reduce any harmful effects on nature to a reasonable minimum,” according to SME spokesman Stephan Trutschler. “We consider these attacks, without having even had a single discussion with representatives of the mining company, to be rather pointless. Germany is a high-technology location with an enormous consumption of rare earths and ores. We could of course also continue to extract these on a large scale from the mines of Central Africa and Latin America documented child labour and/or work under catastrophic environmental conditions – and then have it shipped halfway round the world to us. Whether this is actually what a green sustainable policy should look like, I very much doubt,” Trutschler continued. In his view, we should not omit from consideration the fact that in the medium term, around 150 jobs will be created in a structurally weak region – 36 full-time staff are already employed – and that numerous suppliers and other service-providers will also benefit from a company in this segment. “I absolutely do not wish to speculate here about the business tax which will then substantially benefit the city purse and the surrounding municipalities,” Trutschler concluded.

“We are of course aware that our planned mine is a not-insignificant encroachment into the landscape of the Luchsbachtal Valley,” explains Klaus Grund, Technical Director of SME. “Therefore we will naturally do everything we can to keep the effects as minor as possible during the operational period of the mine and to employ landscape and species conservation measures during and after mining activity to protect the natural environment of the valley and to eventually restore it as far as possible.”

The specialist environmental planners from Pirna particularly focused on the compensatory measures for the planned minerals processing plant, the accumulation on the tip which is already in existence and on the diversion of the Luchsbach stream. Since woodland areas will have to be cleared for the new spoil tip, the planners say that a larger area outside the Luchsbachtal valley must be turned into a woodland, although the precise area has not yet been determined. Following the operational period of the mine, the tip must also be re-forested and extensive grassland areas created. In order to exclude the possibility of ground erosion, tip accumulations and clearings will also only occur section by section. Furthermore, as compensation for the use of a meadow for the processing plant, a wildflower meadow for insects will be developed and cultivated close to the Zinnkammern visitor mine. The visitor mine and the Morgenstern visitor gallery will remain accessible throughout the entire operational period, and the forest and hiking paths will also remain open, even if sometimes diverted.

According to the studies, apart from the construction phase for the erection of the plant, the effect on traffic for the people of Pöhla will be limited, since once the mineral processing plant is in operation, only the selected raw materials concentrates will need to be transported away. Also, the processing plant will be set up in a closed building, which will also contribute to preventing noise pollution.

The environmental planners do not foresee any difficulties in relation to the issue of groundwater, either. The intention to pump away the groundwater in the immediate area of the mine will also not lead to any lowering of the groundwater table, as in previous mining eras. Also, the water pumped off will be regularly checked before feeding into the watercourses, and the daily volume discharged will be restricted.

In addition to the establishment of a substitute meadow biotope, further conservation measures are also possible, according to the environmental planners. However, numerous species studies should be undertaken on-site beforehand, as agreed with the Erzgebirgskreis district local conservation authority.

“The experts from Schulz Umweltplanung have done a thorough job. When the responsible authorities have all the required documentation shortly, we hope that the approval process can be concluded swiftly,” Grund concludes. (SME/Si.)