Bulgaria in Desperate Attempt to Salvage Lead-Zinc Plant

Industry | May 17, 2012, Thursday // 11:35|  views

Workers of the Lead and Zinc Complex in Kardzhali are collecting signatures for a petition in their support. Photo by BNR

Bulgaria's Economy and Energy Minister, Delyan Dobrev, is discussing Thursday with bank creditors the future of the Kardzhali Lead and Zinc Complex (LZC; OTZK).

OTZK is the largest Bulgarian producer of non-ferrous metals in the southern city of Kardzhali, providing until recently livelihood of many in the city and the region.

OTZK has been out of operation in the past five months due to the plant's failure to meet environmental safety requirements.

OTZK owner Valentin Zahariev also failed to complete the investment program of the plant and to pay salaries to a total of 519 employees for six months.

Deputy Prime Minister and Finance Minister, Simeon Djankov, had assured the regional administration on Wednesday that there is still interest on the part of a "solid, financially stable investor," adding the State expects from Zahariev to become more active, so that an agreement could be reached.

It was also reported that Prime Minister, Boyko Borisov, had a talk Wednesday evening with the new owner of the Gorubso mines in the southern town of Madan, Nikolay Valkanov, to "find work for OTZK employees." The information was reported by Borisov himself, speaking Thursday for Nova TV.

According to the PM, the State is seeking Valkanov's assistance so that the metallurgists can receive their wages until the conclusion of the negotiations with the creditors. He admitted that the huge debts of the complex are pushing potential investors away.

Meanwhile, one of the four workers who went on hunger strike over the uncertain future of OTZK had terminated it after feeling ill.

Ninety OTZK employees from those maintaining the furnaces have already left the complex, which can create huge problems, metallurgy experts explain.

The zinc must be kept in liquid state otherwise the furnaces will become unusable. This would not present an environmental hazard for the city, but will force the complex either to close for good or to replace the furnaces in question.

It is, however, expected that on Monday the workers will quit massively and will register as unemployed to receive social assistance.

The demonstrators, who have erected a tent in the city's downtown to collect signatures for a petition, inform they have already received 8 000-strong support.

Employees of the Lead and Zinc Complex were on strike for about a month due to unpaid wages and social security contributions.

The workers started receiving their money back in mid-April, as Zahariev raised cash through the sale of the Gorubso mines in the southern town of Madan.

Gorubso-Madan was likewise in dire straits, with workers protesting due to unpaid salaries.

After the state interfered, the mines were sold to a company owned by Nikolay Valkanov and became operational again, after Valkanov took over the concession.

Valkanov is a former VP of Multigroup, the company of Bulgarian tycoon Iliya Pavlov, who was shot dead in 2003.

Valkanov currently owns "Minstroy" and Gorubso Zlatograd, another mining company in Southern Bulgaria, and holds the concession for the "Varba" mine.

As OTZK workers started receiving payments, Prime Minister Borisov announced that there would be a change of ownership of the plant.

Borisov vowed that the talks for the potential sale of the plant with the creditor banks would take no more than a month.

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Tags: Nikolay Valkanov, protests, unpaid wages, mines, gorubso madan, Valentin Zahariev, Lead and Zinc Complex, OTZK, Boyko Borisov, Prime Minister, petition, KNSB, Delyan Dobrev, Economy and Energy Ministry, hunger strike, Simeon Djankov


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