It seems junior coal explorer Prairie Mining (ASX:PDZ) can’t catch a break from the Polish government, with reports that authorities have now awarded the rights to part of the company’s Jan Karski mine to a local company.

Prairie revealed today that a press release had been issued by Polish coal producer Lubelski Węgiel Bogdanka saying it had been awarded a mining concession by the Polish government for the K6-7 deposit.

According to Prairie, the K6-7 deposit is an “integral part” of its planned Jan Karski mine.

The news saw its shares slide nearly 9 per cent on Tuesday morning.


Prairie said it could not make further comment regarding Bogdanka’s announcement until it had received formal notification from the Polish government and it could assess its legal options.


Long-running dispute

It is not the first time the company has gone up against the Polish government.

In April 2018, Prairie was forced to head to court over prolonged delays in receiving environmental approval for the Jan Karski mine in eastern Poland.

READ: Nervous wait as Prairie Mining heads for court in Poland; shares slide

A year later, Prairie was granted an injunction preventing the Polish Ministry of Environment from granting prospecting, exploration or mining concessions and concluding mining agreements with any other party until full court proceedings were concluded.

But that decision was subsequently appealed and overturned.

And in February this year, Prairie said it was considering turning to international authorities to settle another legal ruckus it was having with the Polish government over its Debiensko project.

READ: Prairie Mining is stepping up its legal fight against Poland

In December 2016, following the acquisition of the Debiensko coking coal mine, Prairie applied to the Ministry of Environment for an extension to the time stipulated in the mining concession for first production of coal from 2018 to 2025.

But the request was denied by the government.

Prairie then came under pressure to resolve the issue before the government limited or confiscated the Debiensko concession from the company.

But today the company said, “no amicable resolution of the dispute has occurred, since the Polish government has declined to participate in substantive discussions related to the dispute”.

Prairie is working with its legal advisers, including international arbitration legal experts, to prepare submissions and finalise funding arrangements for international arbitration.