Romania: Regenerating Mining Communities throughout the Country

Challenge

Mine closure planning is complex, often more so than the project design and construction. The planning horizon for mine closure is measured in decades, and involves complicated and interrelated social, economic, and environmental parameters that are likely to change over time. Mine closure has significant repercussions on local communities, as the mine has often been a major economic player providing important fiscal revenue and social services to the local community. It also raises concerns about environmental management, unemployment, and the continuing provision of basic social services, such as water, electricity, and health care. At the time of project launch, Romania’s mining sector required major subsidies, a considerable drain on government resources, and the mine closures were a significant social hardship for miners, families, and communities.

The key project challenge was to accommodate the physical mine closure in an environmentally acceptable manner and help mitigate the social impact on the workforce and the community, leaving behind an enduring positive legacy in the mining region and the affected communities

Solution

The project development objectives were to (i) strengthen the government’s ability to undertake mining sector reform and its capacity to close uneconomic mining enterprises by supporting the closure of complex mines and ancillary facilities in an environmentally sustainable manner; and (ii) provide support to mining communities and local public authorities for socioeconomic regeneration. This dual strategy, working concurrently on environmentally sound mine closure, and on scaling up local employment opportunities for former mineworkers and strengthening local capacity to improve local infrastructure and services, was an innovative approach, building on lessons and limitations of previous experience with mine closure in the country. The Bank’s approach highlighted the key principle of heightened participatory engagement with communities to ensure that former mines be returned to communities as assets rather than liabilities.

Results

Between 2005 and 2012, there were 654,766 direct project beneficiaries of the SER component, over 20 percent above the set target, of which 325,424 were women.

•  Mine closure component: 23 mines were successfully closed in 2005–12;
  
  
•  under the SER component, many of the end-of-project targets were exceeded and included seven times the target value in the average percentage increase in own revenues of local budgets in the operating areas; strategic development plans were developed in a participatory manner in 50 percent more local public authorities than projected in targets; and there were 245 social development schemes for mining communities (target was 144), 646 small grant schemes (target was 350), and 42 completed municipal infrastructure subprojects (target was 30);
  
  
• under the mine closure component, key achievements included the strengthening of the legal framework for the management and implementation of mine closure, evidenced by the 98 legal codicils specific to mining activities and mine closure that were proposed and passed through the efforts of the project, including three laws, two emergency government ordinances, and two government ordinances. A mine closure manual and technical norms and regulations for closure works were implemented according to European Union (EU) and international best practices.

Bank Group Contribution

The International Bank for Reconstruction and Development (IBRD) provided approximately US$89 million for this project. The borrower contributed roughly US$30 million.

Partners

The U.S. Environmental Protection Agency was a major partner, providing expert technical staff members of the project team throughout the project. Within Romania, project partners were the Ministry of Economy, the Commerce and the Business Environment (MECBE), the Ministry of Public Finance, the Romanian Agency for the Sustainable Development of Industrial Areas (RASDIA), and the Romanian Social Development Fund (RSDF).

Moving Forward

There are significant lessons learned from the implementation of the project, including strategic approaches to mine closure, incorporating robust environmental stewardship and state-of-the-art methodologies for mine-site monitoring. The approaches piloted under the project will be incorporated into the Romanian CONVERSMIN mine supervision agency and its ongoing duties in mine monitoring. Key project achievements include the strengthening of the legal framework for the management and implementation of mine closure. There is strong local stakeholder support for continued support in the sector.

This investment operation is of particular relevance to EU accession and standards compliance, and to dealing with the environmental legacy of mine closure sites and providing incentives and opportunities for income generation and social welfare improvements.

Beneficiaries

 “Over 1,500, 000 tons of coal were trucked over that bridge which, of course, collapsed. Our first objective was to ensure that this village was not cut off from the world. So the bridge was reconstructed. The second objective was to protect the village from a mining-waste land slide. Finally, our works made sure that water from the mine didn't run through the village,” says Mihaly Szocs, engineer at Cartel Bau S.A.