OKD


Type	joint stock company
Industry	Mining
Founded	1952
Headquarters	Ostrava, Czech Republic
Key people	Dale R. Ekmark, Managing director
Products	Hard coal
Revenue	CZK 27.4 billion (2014)
Owner	NWR
Number of employees	10,099 (2014)
Website	http://www.okd.cz/

Location of Karviná
Location of Karviná
Coordinates: 49°51′15″N 18°32′34″E / 49.85417°N 18.54278°E / 49.85417; 18.54278

OKD (Czech: Ostravsko-karvinské doly; Ostrava-Karviná Mines) is a major mining company in the Czech Republic, the only producer of hard coal in the country with an annual production of around 8-9 million tonnes from 4 mines with 23 shafts extracting coal from depths ranging from 600 to 1,300 metres below the surface.).^[1]

Its coal is mined in the Karviná basin in the southern part of the Upper-Silesian coal basin (operations in the Ostrava basin were stopped in early 1990s). The Company produces quality coking and thermal coal for the steel and energy markets in Central Europe.

OKD controls a subsidiary, OKD, HBZS, a.s. (mining rescue service), which pursues activities related to coal mining.^[2]

OKD is the largest employer in the Moravian-Silesian Region and the second largest private employer in the Czech Republic. In 2011 on average 11,000 people worked for the Company. OKD´s subsidiary OKD, HBZS a.s. provided jobs for almost 200 people.

OKD in socialist Czechoslovakia

The foundations for the later OKD were established shortly after the Second World War when six existing mining companies were nationalized to form a state-owned company called Czech: Ostravsko-karvinské kamenouhelné doly.

The group actually encompassed a total of 32 mines, 9 coking plants, 10 mine power plants, the Třinec and Vítkovice steelworks, and several other industrial companies, and had a peak production of 24,7 million tons of coal recorded in 1980. State control of the company ended on January 1, 1991 when the company was wound up and a new joint-stock company, Ostravsko-karvinské doly (OKD), was established.

OKD after 1989 (Velvet Revolution)

Thereafter, the newly created OKD, a.s. launched a restruction process – both mining and surfaře operations were combined into larger business entities and units and OKD subsidiaries were established.

Fundamentals steps in the company, streamlining process included a swift closure of the Ostrava mines, the subsequent headcount reduction and a gradual privatization of the company. In the period from 1990 to 2001, mining activities were abandoned in the Ostrava and Petřvald part of the district on an area of 180 km2.

In 1998, the government sold its majority share in the company to Karbon Invest, a.s.. In autumn 2004, Karbon Invest, a.s. purchased another stake held by the state to become the primary shareholder. It was in the same year that the majority share of Karbon Invest, a.s. was ecquired by RPG Industrie Ltd., an entity owned by a group of international institutional and private investors.

OKD in the new millennium

In December 2005, the OKD Board of Directors approved a proposal to split the company. Core (mining) activities were transferred to the successor joint-stock company OKD, a.s. Other activities, not related directly to the primary mining activities, were taken on by another set of companies.

An RPG Group restructuring process also continued. Hald coal mining and coke production in the Czech Republic and Poland were brought together under the umbrella of New World Resources, which became one of the leading coal producers in Central Europe. NWR pens 100% of OKD stock.

In spring 2008, NWR shares were successfully listed on stock exchanges in Prague, Warsaw and London. The move created the biggest ever IPO on the Prague Stock Exchange, while in London it formed one of the biggest IPOs of 2008.

In 2008 OKD started working on large investment programme – 'Productivity Optimisation Programme 2010 (‘POP 2010’). At an investment of approximately EUR 450 million, POP 2010 is one of the biggest projects of its kind in Europe. The primary objective of POP 2010 was to improve equipment performance by implementing state-of-the-art technology for longwall production and gateroad development. The investment includes the acquisition and installation of state-of-the-art machinery, coupled with an extensive training programme across all four active coal mines.^[3]

The Company has also published the OKD Safety Policy, which emphasises management’s priority placed on employee work safety. In September 2008, OKD unveiled its SAFETY 2010 programme. On a year-to-year comparison, the key safety and injury rate indicators at OKD sites in 2010 show favourable trends. The number of injuries decreased from the previous year’s 346 to 248 in 2011, which represents a reduction of 28%.^[4] Company invested a further EUR 17 millions into the purchase of the most modern personal protective equipment available.^[5]

In 2008 OKD renewed its long-standing support for mining education. OKD has renewed its collaboration with the Vocational School of Technology and Services in Karviná, the institution which has traditionally trained workers for the OKD mines, supporting the introduction of a new three-year curriculum to train mining operation specialists, such as U/G electricians and mechanics.^[6]

On the 4th of May 2016 OKD declared insolvency.

Active coal mining operations

There are four active OKD hard coal mines: Karviná, Darkov, Paskov and ČSM. Reserves in these active mines total 195 million tonnes (as at 1 January 2012).^[7] Mining is carried out in the active part of the district in area of 133.65 km2 in nine face working areas.

Major customers include ArcelorMittal, ČEZ, Dalkia, Dunaferr, Moravia Steel, U.S. Steel, Verbund and voestalpine.

Karviná Mine: Lazy and CSA mines were combined into one business unit named Karviná in 2008. In 2014 Production 3.048 million tonnes, reserves 20 million tonnes, coal type: Semi-Soft Coking/Hard Coking/Thermal.
Darkov Mine: Mining in the area where the Darkov mine is located began in 1853 in the Gabriela mine. The Hohenegger and Austria mines began production in 1883 and 1907, respectively. These mines were merged in the 1950s. The Závod 2 site began operations in 1982. In 2014: production 2.195 million tonnes, reserves 9 million tonnes, coal type: Semi-Hard Coking/Thermal.
ČSM Mine: The construction works for ČSM located in Karviná began in 1958 and operations began in 1968. In 2014: production 2.236 million tonnes, reserves 26.5 million tonnes, coal type: Semi-Soft Coking/Hard Coking/Thermal.
Paskov Mine: Paskov, with its one active site in Staric, is the only active mine in the Frýdek-Místek region. The original Paskov site was founded in 1961, began operations in 1965 and closed in 1999. The Staric site was founded in 1963 and began operations in 1970. In 1994, the Paskov and Staric sites were merged into Paskov.^[8] In 2014: production 862,000 tonnes, reserves 2.5 million tonnes, coal type: Hard Coking. Paskov Mine is very problematic.^[9]

Corporate social responsibility

Corporate responsibility and sustainable development are key elements of OKD’s corporate strategy, pervading in particular corporate governance, occupational safety, environmental protection, the application of modern technologies, and relationships with communities where OKD operates.^[10]

CSR strategy is based on 4 core pillars:

Corporate Governance - Management of the company adheres closely to stringent corporate governance principles, compliant with the relevant international standards and recommendations concerning relationships with shareholders, business partners and customers, as well as internal corporate processes.
People - Caring for employees across areas including safety, healthcare, a suitable working environment, fair remuneration and education.
Community - The company maintained close relationships with the communities in which it operates and aimed to develop mutually beneficial partnerships.
Environment - For the long term, the company strives to employ all means available to mitigate the environmental impacts of its activities.^[11]

In 2008 OKD Foundation was founded and over the course of three years established its firm position among the leaders of the Czech Republic’s non-profit sector. The Foundation’s main objective is to support and develop non-material values, the environment, education, sport, cultural activities, and the area of social and medical services.^[12] OKD has chosen to donate 1% of its annual gross profit to the Foundation. Besides OKD and parents company NWR, notable donors to the Foundation include subsidiaries and partner companies (Advanced World Transport, RPG RE, Green Gas, OKK Koksovny). OKD Foundation has supported more thanalmost 2,000 projects since its inception. To evaluate its own activities and for reporting purposes, the OKD Foundation applies the internationally recognised LBG guidelines.

OKD is the founder of the Saint Barbara Civic Association, established in 2004 with the mission of supporting children who have lost a parent due to an occupational accident. The Association aims to ensure that a lack of finance does not hinder orphaned children in their access to education, the development of their various talents, or their pursuit of leisure-time activities. Thanks to the support provided, these children have unhindered access to education.^[13]

OKD accepts its responsibilities resulting from the environmental impact of its operations. NWR implements comprehensive solutions to eliminate the effects of its mining operations, comprising a series of steps and activities leading to the minimization of the impact of mining on the landscape.^[14] The land reclamation aim at returning the lands changed significantly by human activities into the natural state in which such areas exist as autonomous ecological systems.^[15]

References

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