Economy, Business And Markets

Debtors Refuse to Pay Mine Royalties

Debtors Refuse to Pay Mine RoyaltiesDebtors Refuse to Pay Mine Royalties

According to the Supreme Audit Court, the country’s two major iron ore mines, Golgohar and Chadormalu, owe 34.85 trillion rials to the government in accumulated debt over the years as mine royalty, Eghtesadnews reported.

According to lawmaker Nader Qazipour, the two mines had to pay at least 8 trillion rials during the first half of the outgoing year (March 21-September 22, 2014). The MP explained based on the Article 45 of the Constitution, seas, rivers, and mines are national properties and cannot be transferred to companies and individuals but can only be temporarily granted for exploitations. He acknowledged that the mines have developed activities and built processing units, to produce iron ore pellets for instance, but emphasized that they cannot be an exception to the rule.

The parliament recently passed a law, based on which all mining companies are required to pay up to 25% worth of their extraction as mine royalty. The law offers exemption for those miners that further process the raw minerals. The iron ore companies that process the iron ore into iron ore concentrate, iron ore pellets, and sponge iron can obtain exemptions of up to 10%.