Adriatic Metals is assuming control as the operator of the Rupice deposit development, a vital component of the Vares silver mine located in central Bosnia.
Since 2022, local company Nova Mining and Construction had been overseeing the development of the Rupice deposit. However, in June last year, Adriatic opted to implement an accelerated development action plan, enlisting experienced international operators to enhance productivity levels. Adriatic cited the contractor’s failure to meet contractual expectations as the reason for the decision.
The mining company has now terminated its services contract with Nova. Both parties have signed a settlement and termination agreement, enabling Adriatic to take over the operation of the mine upon conclusion.
Adriatic highlighted a significant increase in underground quarterly development at Rupice, reporting a surge of 71% since the implementation of the accelerated development action plan.
The Rupice deposit forms part of Adriatic’s recently inaugurated Vares silver mine, marking the first new mining operation to commence in Europe in over a decade.
Paul Cronin, Adriatic’s Managing Director and CEO, expressed that the timing is opportune for the transition to mining owner-operator. Cronin emphasized the Vares Project’s potential to become one of the world’s lowest-cost silver producers, reaffirming the company’s commitment to reducing mining costs through operational enhancements, stringent cost management, and optimized procurement processes.
Following the announcement, shares in Adriatic rose significantly, closing 5.35% higher in Sydney at A$4.53 per share and registering a more than 6% increase in London mid-afternoon, trading at 232.75p each. Adriatic Metals presently boasts a market capitalization of £716.42 million ($883 million).
Prior to attaining commercial production status, the Vares project accounted for 25% of Bosnia’s foreign direct investment in 2022 and is projected to contribute 2% to the country’s GDP during its operational phase.
Adriatic noted that approximately 27% of the mine’s employees are women, surpassing both the global mining workforce average of 15% and the approximately 10% representation in Bosnia and Herzegovina, as per a 2020 World Bank report.
