KAVADARCI, Macedonia, May 11 (Reuters) - The new owners of the Ferronikeli mining and smelting complex in Kosovo, one of the largest in Europe, say limited production could begin within the year.
A Zurich-based consortium of International Mining Resources (IMR), part of the Eurasian Natural Resources group, and the Alferon management company paid 30.5 million euros for Ferronikeli, which is estimated to have 13 million tonnes of nickel ore -- used to produce steel -- in three open-pit nickel laterite mines. Kostas Lamnatos, Ferronikeli's new general manager, said on Wednesday he hoped to have one of the two production lines operational within the year, but wartime bomb damage and disrepair could force a delay.
"The target is November, but we may face some problems and start in late December or January," he told Reuters during a trip to one of the company's other mines in the town of Kavadarci in neighbouring Macedonia.
"The second production line is expected to become operational between three and six months after the first."
Lamnatos said each production line was capable of producing 5,000 tonnes of nickel per year.
Ferronikeli, located in the run-down town of Glogovac in central Kosovo, was badly damaged in NATO's 1999 bombing campaign to drive out Serb forces accused of atrocities against the ethnic Albanian majority.
IMF/Alferon signed a final sales deal with the U.N. mission running Kosovo in November last year. But the deal only officially went through last month following lengthy negotiations on the electricity supply to the complex. Kosovo is still plagued by power restrictions.
The sale represented the largest single private investment in Kosovo since the United nations placed the province of two million people under international stewardship in 1999.
The agreement obliges the new owner to create 1,000 jobs and invest 20 million euros in the first three years.
Lamnakos said mine reserves were sufficient until 2010-13. "That means that before then we have to start exploration for new mines."
The U.N. frequently cites Kosovo's mineral wealth as a future source of prosperity, as the major powers near a decision on its "final status" in talks expected to end later this year. The ethnic Albanian majority is pushing for independence.
Kosovo is rich in nickel and lignite. U.N. officials say the mining sector has the potential to create 35,000 jobs and attract 1.8 billion euros in foreign direct investment.