Russian miners see problems replacing departed equipment suppliers, China overloaded, missing deadlines
KIROVSK/MOSCOW. Nov 18 (Interfax) - Russian mining companies are having problems replacing suppliers of equipment for underground work who have left the Russian market, as manufacturers in Russia and friendly countries cannot provide comparable quality, while China is overwhelmed and is having to postpone deliveries on contracts, representatives of Murmansk Region companies said at the Barents-Arctic Economic Partnership - Arctic Mining Industry: New Development Paradigm conference in Kirovsk.
"We've done a lot of work on assessing the possibilities of countries in the near abroad, looked at Kazakhstan, Belarus, analysed the market of China, which is now actively ready to saturate Russia with underground mining equipment. We understand that the quality of equipment that [is made] in the post-Soviet space and that which the Chinese can offer is significantly inferior in quality to the equipment that we bought previously for underground mining work [from] manufacturers Caterpillar , Epiroc, Sandvik and Normet," the director of the Kirov branch of PhosAgro Group's JSC Apatit, Andrei Abrashitov said.
Only imported self-propelled equipment was used for underground mining work, unlike for open-pit mining, he said. But "now, unfortunately, there is pretty much nothing to replace it with," he added.
Abrashitov's presentation said that the main supplier of underground self-propelled equipment in 2022 was Caterpillar. The company delivered 11 pieces of equipment this year and suspended delivery of eight. An option for 19 pieces of equipment for 2023 has not been confirmed.
PhosAgro signed a contract for self-propelled equipment with a China company, but problems arose with delivery times.
"Unfortunately, the suppliers, who won a tender and signed a contract, are already informing us that equipment delivery dates are moving, significantly worsening. At present, delivery times for the main mining equipment amount to more than a year," Abrashitov said.
He also said miners are having problems with supplies of drill bits, materials and spare parts, and equipment servicing. "Alternative suppliers today supply fairly poor quality spare parts, which of course reduces our efficiency indicators," Abrashitov said.
"At present, it must be acknowledged that the domestic machine building industry, unfortunately, is not ready to provide us with alternative offerings for self-propelled underground equipment," he said.
The acting CEO of Severstal mining division JSC Olkon, Alexander Isakov and the CEO of Acron Group's North-Western Phosphorous Company (NWPC), Yevgeny Sozinov concurred.
"We do indeed use a large amount of foreign equipment. In underground mining, virtually all of it is foreign. We are experiencing restrictions with supplies of spare parts, finding a limited amount, delivery times are very long, so production volumes are falling," Isakov said.
"As for mine transport, contracts have already been signed with Chinese manufacturers. Yes, at the moment they are fairly inundated, deadlines are constantly being pushed back, which, accordingly, will lead to certain changes in the operation of our underground mine," Sozinov said.
Speaking about equipment for open-pit mining, he said that, "unlike European and American companies, [Japan's] Komatsu has not left the market - full-fledged delivery of spare parts and equipment servicing are being carried out." Prices for spare parts have risen and delivery times are longer, "but on the whole we don't have any disruptions in open-pit work at the moment," Sozinov said.
He said that in its search for alternative suppliers, NWPC is working with Yekaterinburg-based Machine Building Holding, which has made a drilling rig for tunnelling. This will make possible to partially resolve the problem of late deliveries of spare parts from Sweden and other countries, Sozinov said.
"I'd like to note that in the process of import substitution we are not only solving the problem of the lack of spare parts, but also the issue of economic efficiency," Sozinov said. For example, the price of spare parts for Epiroc drilling rigs from Russian companies is five times higher, and this is the case for "many items," he said.