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Czechoslovakia Mining and Energy
In the mid-1980s, Czechoslovakia's mineral resources were
meager. The country was heavily dependent on imports of raw
materials for use in industry (see
table 9, Appendix A). Deposits
of ferrous metals were small and low grade; in 1983 production
amounted to 1.9 million tons. Imports, especially from the Soviet
Union, supplied the dominant share of iron ore for the country's
important iron and steel industry. Magnetite, a basic input for
the steel industry, was more plentiful, making exports possible
during the 1970s and 1980s. Deposits of nonferrous metals were
limited or nonexistent. Imports supplied most of the country's
needs for these metals. In 1983 about 9,500 tons of copper and
3,800 tons of lead were produced. The same year, 7,000 tons of
zinc were mined, but imports supplied the bulk of requirements.
The country also produced limited amounts of gold and mercury.
Imports supplied most of the country's needs for nonferrous
metals. Czechoslovakia did supply most of its own requirements
for nonmetallic minerals to support the manufacture of building
materials, glass, and ceramics.
The bulk of the country's mining activity involved coal, the
principal domestic energy source. Located primarily in northern
Bohemia and Moravia, freely extractable reserves reportedly
amounted to 5.8 billion tons as of 1986. Of this quantity, about
30 percent was bituminous coal. In 1985 production of all coal
amounted to 126.6 million tons, a 2.1 percent drop over 1984 that
signaled the accelerating exhaustion of easily worked, high-grade
reserves. In 1985 Czechoslovakia depended on coal for 60 percent
of its energy consumption in contrast with 88 percent in 1960.
The decline in the share of total primary energy consumption
represented by coal had occurred even though coal production had
expanded throughout the 1970s. During these years, the growing
need for energy was met primarily by imported oil and, from the
mid-1970s, by natural gas; almost all imports of oil and gas came
from the Soviet Union. Domestic crude oil sources and production
were modest. Within Czechoslovakia itself, numerous small oil and
gas fields had been discovered, but production was minor (about
100,000 tons of crude oil and 800 million cubic meters of natural
gas in 1985). These supplied only a small fraction of the
country's needs. Geological surveys largely ruled out the
possibility of future discoveries of major oil or gas deposits,
although one significant new source of natural gas was discovered
in 1985 near Gbely in western Slovakia.
During the 1970s, the Soviet Union found it increasingly
difficult and costly to meet the fuel and raw materials needs of
Czechoslovakia and other East European countries. The unexploited
Soviet resources tended to be located in Siberia, where
extraction and transport were difficult and costly. One solution
to the problem was Comecon's decision to adjust Soviet energy
prices annually after 1974; as a result, Soviet prices
approached--and eventually at times exceeded--world market
prices. The adjustment improved the terms of trade of the Soviet
Union at the expense of Czechoslovakia and its neighbors when
world prices for many commodities, particularly crude oil, rose
sharply in the middle and late 1970s. The higher prices in turn
resulted in a larger return to the Soviet Union for its exports
of fuels and raw materials and helped to finance expansion of
Soviet production capacity. In addition, in the 1970s Comecon
initiated several joint projects, such as the construction of a
major natural gas pipeline from the Soviet Union to Eastern
Europe and of large nuclear power plants in the Soviet Union
(see Appendix B).
The participating countries, including
Czechoslovakia, received payments in the form of natural gas and
electricity. In the mid-1980s, Czechoslovakia also participated
in construction of the Yamburg natural gas pipeline "Progress" in
the Soviet Union.
From 1967 to 1984, Czechoslovakia benefited additionally from
a special agreement with the Soviet Union--in effect a
Czechoslovak credit from 1967--whereby Czechoslovakia received 5
million tons of Soviet crude oil a year at a late 1960s price,
which was just a small fraction of the world market price. Thus
while increased Soviet fuel and raw materials export prices
imposed a severe burden on Czechoslovakia, the cost was
substantially less than if the country had imported these
materials from noncommunist countries. In 1980 a Czechoslovak
official indicated that Czechoslovakia was paying about onefourth the world price for its oil imports. By 1985, however, the
situation had changed dramatically. In 1981 the Soviet Union had
announced a 10-percent cutback in the crude oil it would deliver
to East European countries during the 1981-85 period.
Subsequently--and for a variety of other reasons--world oil
prices plummeted, but the Soviet price, based on the five-year
formula, continued to rise.
In the mid-1980s, the country's leaders considered energy
conservation essential. Czechoslovakia's heavy reliance on fuel
imports was costly. Imports supplied 95 percent of the country's
fuel needs, and the country needed to import about 16.6 million
tons of crude oil and 10.5 billion cubic meters of natural gas
each year. Conservation was also essential because although
Soviet supplies of natural gas were expected to increase, the
more important flow of crude oil was likely to stagnate. In the
short run, extraction of domestic coal would help Czechoslovakia
meet its growing energy needs, but the increase would be slow and
costly because deeper deposits had to be mined in order to meet
quotas. The fuel problem was especially acute because
Czechoslovak industry had a high input of energy per unit of
national income, a rate substantially higher than that of Western
Europe and some East European countries (7.5 tons of standard
fuel per inhabitant per year). Industrial consumption of largely
imported raw materials and energy was acknowledged to be perhaps
as much as 40 percent higher than in comparable advanced
industrial countries. The KSC leadership rightly believed that
considerable savings were possible.
Nevertheless, conservation alone would not suffice. Since the
1970s, economic planners had been pursuing an ambitious nuclear
energy program. In the long run, in their judgment, nuclear power
was absolutely vital to the projected energy balance. In late
1978, the first major nuclear power plant (of Soviet design)
began operation at Jaslovske Bohunice. In 1985 and 1986, portions
of the Dukovany station began test runs, and preliminary site
work was underway for two more power stations, at Mochovce in
western Slovakia and Temelin in southern Bohemia. Nuclear power's
share of the total electricity supply increased to almost 20
percent in 1986. According to the long-range plan, with expansion
of this power station plus construction of additional stations
and the import of electricity from joint nuclear projects in the
Soviet Union, nuclear power would provide 30 percent or more of
total electricity by 1990. Plans called for nuclear power to
account for over 53 percent of electricity by the year 2000.
Although the 1986 Chernobyl accident in the Soviet Union did not
alter the government's commitment to nuclear power, particularly
since none of the existing or planned reactors used the kind of
technology employed at Chernobyl, Czechoslovak leaders
acknowledged the need for a thorough review of safety measures.
Subsequently a number of special conferences were held concerning
nuclear power issues. Czechoslovakia was well positioned to fuel
its ambitious nuclear program; in the mid-1980s, the country was
an important producer of uranium. Little information on uranium
output was available, but annual production was estimated by
Western analysts at 2,000 to 3,000 tons. The reserves were
located in the Krusne Hory of Bohemia.
In the mid-1980s, Czechoslovakia had a substantial number of
hydroelectric plants, located mainly on the Vah and Vltava
rivers. Work was underway on a major hydroelectric power project
on the Danube River at Gabcikovo-Nagymaros, a controversial joint
project with Hungary to which environmentalists, especially in
Hungary, had objected. The completed project was expected to
supply about 4 percent of Czechoslovak energy requirements. In
1986 the government approved plans for construction of several
additional power stations on the Labe and Vah rivers by the end
of the century. Czechoslovakia imported some electricity each
year from Romania.
Data as of August 1987
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