Kolubara Mining Basin key pillar of Serbian energy stability, Facing problems that are solvable says GM Milorad Grcic

8. November 2012. / Uncategorized

Key issue is the financial insolvency of the company  and incapability of settling undertaken obligations.

Workers should not be paid by lay-offs considering  the fact that the number of employees will decrease naturally.

Mr. Milorad Grčić, the acting director of Mining basin “Kolubara“ was said by his closest associates, in discreet conversation, to be a man of great energy, ready to learn and create an ambient of working as a team. His arrival to the leader position of the Serbia’s top coal producing company was welcomed with different reactions, ranging from critical reaction, approvals, to those who said that the time will tell and that it should be seen in which direction he will take the company with 10.000 employees.  We were to say the least surprised when our companion gave to our journal “Kolubara“ the first interview without authorization that we hereby publish in authentic form.

Since your appointment for the Leading position of MB Kolubara you have had a lot of discussions and contacts with the management from the production sector and EPS. What are your impressions, i.e. diagnosis on our company?

Before I answer this question I want to emphasize that I have been given a great trust and I honored by the fact that I have the opportunity to be the Acting Director MB “Kolubara”. I am aware of the great responsibility and demands set before me. At the risk of repeating what your readers already know, I’m going to say that we are the biggest company or the company belonging to EPS. We are a leading producer of coal in Serbia, producing about 30 million tons of coal per year, which is 74 percent of total coal production in EPS. Out of Kolubara lignite about 52 percent of electricity in Serbia is produced, but the big question is whether that energy is spent rationally or we squander it lightly to heat the apartments and houses. “Kolubara” is a complex system, not only in energy sense, but also in terms of security. The opinion of experts is that the energy stability is the top pillar of sovereignty and economic stability of a country. Energy is getting more important for a small country like Serbia. Thanks to consultation and direct insight into the state of the company I have realized that there are problems and that they, on a smaller scale, refer to production, and more to the objective and subjective difficulties, outside the production sector.

There are problems, but they are not unsolvable.

Can you name the problems not citing the general places, because employees are interested in that most?

At this point, the biggest problem in MB Kolubara is the high insolvency and incapability of settling our obligations regularly, not only towards the suppliers, but towards the employees and many other financial obligations as well.

Moreover, that’s the reason why we were under the obligation to, in EPS as well as in our public limited company (PLC), raise loans from the banks in order to alleviate the chronic insolvency. Apart from the financial problems, which are obvious, there is a serious non-compliance with the internal regulations of our republic legislations. Many questions that seem to be deliberately delayed or not timely resolved are now caught up with us. According to current data, against “Kolubara” has been filed about 7,740 lawsuits that claimed damages based on shifts and night work up to 1st October. Based only on final judgments, MB Kolubara is in obligation to pay off about 2.7 billion RSD. Any further delay of this problem would significantly distort the business of the PLC, putting us in more precarious financial situation. This issue could affect and reduce the value of the working hours of the employees. This issue, in consultation with lawyers, economists, EPS and state authorities, we will try to solve in the painless way.

Then, another big, unnecessary financial burden is the payment of the compensation for the land use that amounted about 580 million only in the last year.

The payment is made according to two bases: Mining Act and regulation on compensation for building land, although the land has changed the purpose and it’s used for coal exploitation. So, we turned to the Administrative Court in Belgrade, since the Belgrade City Council did not have understanding for our justified demands.

What is the future business policy of Kolubara MB management when it comes to hiring workers, especially the status of so-called separated companies, “Kolubara Metal”, “Kolubara Usluge”, “Kolubara Građevinar” and “Kolubara Ugostiteljstvo”?

Workers should not be frightened by lay-offs, considering that the number of employees is decreasing continuously through natural outflow. Seven hundred and eighty employees will be retired next year alone, according to considerations. I am aware that the job classification hasn’t been done yet and that there hasn’t been a properly carried out scoring, so a large number of employees have conflicting wage scales, causing dissatisfaction. We will also make an effort for separated companies and provide their normal functioning through modernization and rationalization. All these problems are being resolved one step at the time.

When creating your first team, what will be the most important thing in their selection and which criteria will be required from the managers?

It is very important that there are many professionals in Kolubara MB who are familiar with the production process and see the company as their other home. They will be given maximum confidence. Most of the first team will consist of the staff from „Kolubara” and Lazarevac and they must be completely committed to the job.

Judgments about the existence of corruption in the EPS have been repeatedly mentioned in the statement given by energy minister Zorana Mihajlovic, Phd. After all, the director of EPS, Aleksandar Obradović states that there is a “widespread suspicion that some parts of the EPS are a meeting point for corruption and abuses, especially in the area of public procurement and overhauls.”What is your opinion on this issue that eats away our society?

There are indications that there is corruption in Kolubara as well, but it is still too early to reach any remarks about it without valid and reliable data. After all, when the time comes, all the data will be made public and employees will be informed about it. It is more important to motivate all employees, particularly professional and creative staff from all fields, from manufacturing to the directorate, to actively engage in addressing the above issues so that our company is not only a reliable partner in the production of coal, but also financially stable system that will regularly settle its obligations to the government, suppliers and employees, whose paychecks mustn’t be threatened.

What is the cooperation and concern for municipalities whose territories are exploited for coal and where mining and energy facilities are built?

We are establishing excellent cooperation with neighboring municipalities, so I have already had the first meeting with the heads of Lazarevac, Lajkovac and Ub. No serious project can work without their cooperation and all operational and strategic projects must be considered through a mutual partnership. On this occasion, I would like to emphasize in particular the excellent cooperation with Dragan Alimpijevic, mayor of Lazarevac.

What kind of informing should there be in “Kolubara” MB?

I personally think that the public should be regularly informed about everything that is happening in the company, regardless of whether those are “easy” or “difficult” issues. We should not try to avoid dealing with the problems, no matter how much they provoke public attention, because this is the long-term interest of the Kolubara MB. If we can be open to the public, people will understand us better and they will understand how demanding our role is, because without the support of the community we cannot solve any major problems. Mutual understanding between us and the citizens, as well as our corporate responsibility, is a way to get closer to the world we live in, and to help solve our problems and problems of the community we live in.

Source Kolubara mines basin company

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