6 Apr 2021 10:31

KAZ Minerals to invest 570 bln rubles in mine, plant to develop Baimskaya Ore Zone - Trutnev

ANADYR. April 6 (Interfax) - GDK Baimskaya, a division of KAZ Minerals, will invest 570 billion rubles in the project to build a mine and processing plant to develop the Baimskaya Ore Zone in Chukotka, Deputy Prime Minister Yury Trutnev, who is also the presidential envoy to Russia's Far East Federal District, told reporters on Tuesday after the signing of an agreement with the investor.

The agreement to grant GDK Baimskaya the status of a resident of the Chukotka priority development area (PDA) was signed by Far East Development Minister Alexei Chekunov and the company's chairman Oleg Novachuk.

"Joint work will amount to the creation of the project to develop the Baimskaya Ore Zone - 570 billion rubles of investment, 1 trillion rubles in budget revenue over the life of the project and the creation of about 3,000 jobs. These are the parameters of the project, which will essentially transform Chukotka's economy, make it self-sufficient," Trutnev said.

The complex will have capacity to mine 70 million tonnes of ore and produce 1.4 million tonnes of copper concentrate per year.

In addition to the tax breaks available to residents of the PDA, such as a lower social insurance contribution rate of 7.6% and zero property, profit and land taxes for the first five years, the investor will also be eligible for a reduced mineral extraction tax (MET) for ten years.

"Today there was a big meeting with representatives of a whole range of federal ministries in order to sort out what the investors, federal government authorities and the leadership of the constituent member of the federation need to do for the project to happen on schedule," Trutnev said.

The complex is expected to start operations by 2027 and reach design capacity in 2028. It will produce copper and molybdenum concentrates, with the former containing copper, gold and silver and the latter containing molybdenum.

"The project involves the phased development of the Baimskaya licensed area with the construction and launch of mining and processing facilities. Baimsky GOK [mine and processing plant] will become one of the most technologically advanced in the world. The latest technologies will be used in production of products," Novachuk was quoted as saying by Trutnev's press service.

Infrastructure development plans include the construction of a year-round port and all-season road that will connect Baimsky GOK, the city of Bilibino and the port.

Power will be supplied to the project by nuclear power plants that will be built with financing from state nuclear corporation Rosatom. The power lines will be built with federal funding.

"Yesterday we had a chance to take a look at the floating nuclear power plant that has arrived in Pevek. The plant is operating. It will supply electricity to Baimskaya Ore Zone projects. Only there won't be the one generating unit of the floating nuclear power plant, but three units. We discussed the timeframe and other necessary aspects for this in detail," Trutnev said on Tuesday.