At the beginning of the year, East Germany’s Frankfurt am Main signed a contract with the mining company LEAG, according to which it will receive five million euros for the development of one of the regional water plants.
According to German journalists, the company has been promised in return that the city and its water company will not spread the word about the negative effects of mining on the drinking water supply. The councilors also undertake that in the future they will not sue the miners for water anywhere and demand compensation for damages through the courts.
The classified contract was obtained by the German editor Correctiv, which specializes in more laborious investigative work. He describes the contract as an example of a broader problem in the entire Lusatia basin, where coal mining and the operation of coal-fired power plants are controlled by Daniel Křetínský together with the PPF group. And where there are a lot of problems with water because of coal.
Extraction of lignite from surface quarries usually results in contamination of groundwater with sulfur compounds. These are substances whose quantity in drinking water is regulated by hygiene standards with regard to human health. This is a long-term problem in the Oder and Spree basins, where mining has been going on for many generations. Part of the groundwater in Brandenburg is already loaded to the extent that it cannot be used for processing into drinking water. In Frankfurt this summer, the concentration of sulfates in treated water rose to the maximum permitted limit.
Due to coal mining, the groundwater level is also falling. All this has the effect that the original water sources, on which the waterworks depended, cease to serve and new ones need to be found. The preparation of drinking water is therefore more complicated and expensive. “The waterworks are silent, but they should sound the alarm,” Correctiv writes about the situation.
Co I Correctiv
Investigative medium bringing together journalists from different corners of Germany and abroad. He concentrates on more extensive research and his own discoveries, the biggest ones he subsequently publishes in cooperation with large media houses and televisions. The exposure of the pan-European tax fraud system “CumEx Files” or the investigation into irregularities in the sponsorship of the AfD party had a great response.
In 2019, Frankfurt am Main filed a lawsuit against the regional mining office for not sufficiently protecting the water from mining. The dispute went all the way to the European Court of Justice, it developed promisingly for the city, but shortly before the judgment was handed down, an out-of-court settlement was reached, including the aforementioned five million dollar payment. According to the editors of Correctiv, similar contracts have been quietly created elsewhere, and one of the media’s informants describes the practice as a “cartel of silence” that has been operating for a quarter of a century.
However, according to the authors of the text, it can be a dangerous trap in the future. Although the cities will now receive financial aid, they are hiding the effects of mining from the public and will lose legal leverage to defend themselves in the event of a deterioration. “The Frankfurt example shows the system: LEAG mining will continue to have a massive impact on what water supply will look like for decades to come. In order for the company to continue doing business as if it were nothing, it buys the silence of the region and the politicians do not demand anything from it,” explains Elena Kolb, one of the authors of the text.
“We do not comment on operational matters from the position of one of the shareholders, it is necessary to ask directly at LEAG,” Daniel Častvaj, the spokesman for the Křetín holding EPH, replied in response to the article.
What is LEAG?
The largest energy company in East Germany, controlling four lignite mines and four coal-fired power plants. After the fall of the GDR, the company was privatized by the Swedish Vattenfall, in 2016 it got rid of it cheaply in a bet on green energy and the early decline of coal. It was bought half by Daniel Křetínský’s EPH holding with Petr Kellner’s PPF group. The initially loss-making enterprise reported a record net profit of 1.6 billion euros last year during the energy crisis. This year, Křetínský acquired part of the shares from PPF, his company now holds 70 percent of LEAG.
LEAG initially did not respond to reporters, as did most of the cities and water utilities contacted. After the publication of the text, the company issued a press release in which it questions the harmfulness of sulfates and mainly denies that the purpose of the agreement in Frankfurt was to silence someone.
According to the company, the contract was only supposed to unblock the threat of a long-standing legal dispute, as a result of which it would not be possible to continue filling lakes after mined quarries and recultivating the landscape. Flooding turns the former coal mine into a popular tourist area full of bodies of water, sandy beaches and bike paths.
According to the Corrective text, however, the tax for a nicer environment has a negative impact on drinking water. This is because pollutants are washed out of the quarries into the rivers during filling, and the waterworks then have to build new wells in order to have something to dilute the contaminated river sources.
EPH Daniel Křetínský
- The foundation of the Cretan Empire.
- Křetínský started building it in 2001 for the J&T financial group, where he was an employee.
- In the first years, EPH grew thanks to the cooperation with ČEZ, from which it bought significant assets.
- In 2009, EPH was separated into a separate holding company, in which J&T and Petr Kellner’s PPF each held 40 percent. Křetínský won 20 percent and became one of the Czech billionaires. At the time, EPH had a turnover of CZK 30 billion, owned two dozen Czech companies and employed six thousand people.
- Petr Kellner left EPH in 2014, after five years the investment had earned him over CZK 10 billion. At that time, EPH already owned gas pipelines in Slovakia, mines and power plants in Germany, and a black coal mine in Poland. Křetínský increased his share to 37 percent, the rest was left to J&T partner Patrik Tkáč and investors around J&T.
- The EPH Group employs more than 24,000 people through its companies. The holding includes over 70 companies across Europe. The holding includes, for example, the energy companies EP Infrastructure and EP Power Europe, as well as EP Logistics International, which brings together companies focused on transport and forwarding, and also EP Real Estate.