It is no surprise that the newly elected government of populist Prime Minister Andrej Babis cancels the Memorandum of Understanding between the former government and European Metals. The lithium deposit in Czech Republic was part of hot discussions during the election campains in television. The new government wants to not only extract but also refine lithium in the Czech Republic to the fullest possible extent to be followed by the production of lithium batteries. The state-owned uranium miner Diamo should take a major part in mapping and possibly mining lithium resources.
But, what is the consequence of the cancellation of the MoU. The MoU outlines the mutual willingness to explore downstream processing opportunities, Czech academic research into lithium processing and potential future co-operation. But, I fully agree with the official EMH statement, that all company rights are derived from the current Czech legal system, notably the Geological and Mining Act. So, the exploration rights are not affected.
From my point of view, it is nonetheless a clear signal that the government wants to have the lithium deposit under state's control. And the mining license has not been granted to EMH, yet.
Is it possible to progress with the work to prepare the feasibility study under these circumstances? Is there a real chance to get the mining license and other approvals from the authorities?
Sure, EU regulations could oppose the intention to bring the deposit under state's control, but at the end, this fight can not been won by the company.
As I first heard from the discussions about mining in Czech Republic during the election campaigns in September, I became aware that an independent jurisdiction and the freedom of capturing economical opportunities are no god-given rights.
We have to fight for our democratic systems and for the fair and lawful treatment of every human or economic party. I wish my friend Keith Coughlan all the best for his project.