Effects of the private land acquisition process and costs on mining enterprises before mining operation activities in Turkey

Abstract

According to the mining legislation in Turkey, different permits must be obtained from the authorized institutions or to reach an agreement with a private landowner according to whether there is private or public land for mining. If the landowner and the mining investor do not agree, the expropriation is conducted if the public interest is observed in the mining operation. There is no doubt that the rights of landowners should be adequately ensured by legislation. However, there are cases where land ownership problems cannot be solved in areas that overlap with mining areas and are subject to private ownership. The expropriation permit process may sometimes last 1.5–2 years. Therefore, mining enterprises are unable to start production activities and risk losing their investments. Especially for the reasons related to private landowners and experts, private land acquisition/expropriation costs for mining activities are quite high compared with the market.To identify and produce solutions to the legal problems in Turkey, in May, June, and July of 2018, a survey study was conducted to ask mining enterprises about their problems in private land acquisition and the costs for them. The mining sector in Turkey expects that all applicable legislations will be proposed in a manner that does not waste the time of the mining investor and that the private land acquisition/expropriation costs will be reduced in a manner that does not pose a risk of mining investment. In this respect, the ratio of expropriation costs to the mining investment amount (MIA) was analyzed according to the different mineral groups and the social and economic development level of the cities where mining was conducted. Based on this research, legislation practices also have negative effects on mining enterprises, on the expropriation costs and the expropriation permit processes.