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Norilsk Nickel

Arctic governments stand by as deadly pollution spews from Russia’s Nikel mine – by Alex Boyd (Nunatsiaq on line.ca -June 11, 2013)

http://www.nunatsiaqonline.ca/

“More profitable to keep polluting the region than modernize the production”

The nickel mine in the aptly named town of Nikel in northwestern Russia is usually notable for three things: it’s big, it’s a massive source of pollution, and, for more than 20 years, it’s defied all attempts to change.

Controversy is as constant in Nikel as the clouds of sulphur dioxide; the mine here is equal parts economic powerhouse and environmental scourge. Yet, criticism has kicked up a notch in recent weeks after European leaders met to discuss issues in the region — and failed to mention Nikel.

Last week’s Barents Summit in Kirkenes, Norway brought together leaders from all over northern Europe, but despite old promises to deal with the mine’s pollution and new commitments to environmental sustainability, the mine located just 50 kilometres away went unmentioned.

Amid the international hoopla over the Arctic, it’s easy to forget that the region is a relatively small place, with a small population. The presence of organizations such as the Arctic Council and the Barents Council means countries are increasingly trying to tackle Arctic issues as a group, but disagreements still arise.

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Norilsk takes another hit in WA – by Nick Evans (The West Australian – April 15, 2013)

http://au.news.yahoo.com/thewest/business/

Russian mining giant Norilsk Nickel has taken another hit to its Australian assets, announcing further writedowns as it prepares to close its remaining WA mine.

According to an abbreviated set of 2012 financial accounts released by Norilsk late on Friday, the world’s biggest nickel producer has written down the value of its Australian and Botswana mining assets by $US278 million ($264.7 million). The company did not apportion the writedowns.

It spent $7 billion expanding in WA nickel at the height of the mining boom in 2007 and is understood to have now written off the vast bulk of the assets it acquired.

The carrying value of its non-current assets in Australia was put at $US511 million at the end of 2011. That figure is understood to have fallen to about $US350 million by the end of last year.

Media reports in Botswana indicate Norilsk may also be preparing to close its nickel mines there, after senior management decided to mothball its Lake Johnston project, north-east of Kalgoorlie, late last month.

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Russia, South Africa Seek to Create OPEC-Style Platinum Bloc – by Ilya Arkhipov & Franz Wild (Bloomberg.com – March 27, 2013)

http://www.bloomberg.com/

Russia and South Africa, countries that hold about 80 percent of platinum group metal reserves, plan to set up an OPEC-type trading bloc to coordinate exports.

“It can be called an OPEC,” Russian Natural Resources Minister Sergey Donskoy said late yesterday in an interview in Durban. “Our goal is to coordinate our actions accordingly to expand the markets. The price depends on the structure of the market, and we will form the structure of the market.”

South Africa mines about 70 percent of the world’s platinum and Russia 40 percent of its palladium, a metal from the same group used to cut car pollution, Johnson Matthey Plc (JMAT) said in a 2012 report. Other nations would be able to join the group. The U.S., Zimbabwe and Canada are among producers of the metals. The Organization of Petroleum Exporting Countries is an oil cartel.

Platinum and palladium prices rose following yesterday’s comments by Donskoy. South Africa and Russia signed only a “framework” accord, he said, with details yet to be decided.

“We are now forming working groups to work out joint actions on this market,” Donskoy said. “There will be a meeting in the summer to discuss mechanisms in detail.”

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Norilsk Nickel: A mainstay in mining – by Will Daynes (Business Excellence – January 30, 2013)

 Business Excellence is a global on-line publication portal for businesses who have stories of excellence to tell: http://www.bus-ex.com/

Mining has been a part of life in the Norilsk area since the 1920s, during which time the seeds were sown for what would become a lucrative industry for the region and Russia as a whole over the course of the subsequent century. It was in 1935 that the government of the USSR created the Norilsk Combine and 1943 that Norilsk managed to produce an annual total of 4000 tonnes of refined nickel, before hitting its target figure of 10,000 tonnes just two years later in 1945.

In the aftermath of the fall of the Soviet Union a joint-stock company was created in 1993, taking the name RAO Norilsk Nickel. By 1997, the company had been sold to private enterprise Interros and had returned to profitability. In the years since, Norilsk has gone on to successfully acquire a host of mining and metallurgical assets across the world, thus transforming itself into a multinational organisation with operations in Russia, Finland, Australia, Botswana and South Africa.

Today, MMC Norilsk Nickel is the world’s largest producer of nickel and palladium, and one of the leading global producers of platinum and copper. In addition, it also produces various by-products such as cobalt, chromium, rhodium, silver, gold, iridium, ruthenium, selenium, tellurium and sulphur. “Our production assets,” explains director of foreign assets, Roman Panov, “are located in five countries, Russia, Finland, Australia, Botswana and South Africa, across which we mine over 30 million tonnes of ore and produce almost 300,000 tonnes of nickel. The latter figure represents a fifth of the world’s total nickel production.”

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Potanin comes out as CEO in Norilsk Nickel boardroom war deal – by Polina Devitt (Mineweb.com – December 17, 2012)

http://www.mineweb.com/

As the Norilsk Nickel boardroom war comes to a Kremlin/Abramovich–enforced understanding, long-time co-owner, Vladimir Potanin has emerged as the incoming CEO.

MOSCOW (REUTERS) – Norilsk Nickel named longtime co-owner Vladimir Potanin as its chief executive on Monday under a deal to end a boardroom war at the world’s top nickel and palladium producer.

Kremlin-backed oligarch Roman Abramovich will take control of a 20 percent voting stake to act as a buffer between Potanin and rival Oleg Deripaska, who owns a share in Norilsk through UC RUSAL, the world’s largest aluminium producer.

Speaking after his unanimous election by the Norilsk board, Potanin said he planned to stay in the job for between 18 months and two years. The peace deal will last for 10 years, with the core shareholders agreeing to keep their stakes for five.

Abramovich, the billionaire owner of Chelsea soccer club, could also act as a conduit for the Kremlin at the cash-rich company that mines the vast mineral deposits of Russia’s far north.

Having brought an end to the four-year feud between Potanin and Deripaska, he could potentially end up sidelining them as President Vladimir Putin seeks to restore order at the $30 billion miner that was privatised in the mid-1990s.

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Oligarchs, not investors, to get Abramovich Norilsk windfall – by Polina Devitt (Reuters U.K. – December 11, 2012)

http://uk.reuters.com/

MOSCOW – (Reuters) – Roman Abramovich, the Kremlin’s enforcer on a peace deal at Norilsk Nickel, will pay cash straight to the Arctic giant’s two main oligarch owners for a stake in the company, depriving other investors of the windfall from an end a billionaires’ feud.

Norilsk Nickel, which mines the vast mineral deposits of Russia’s far north, was one of the biggest prizes handed to insiders in the post-Soviet carve-up of Russian industry that created a clique of politically powerful tycoons.

For years the world’s largest nickel and palladium producer has suffered from a feud between its two main owners, billionaires Vladimir Potanin and Oleg Deripaska.

Fellow billionaire Abramovich, owner of London’s Chelsea football club, settled the row last week by sweeping in to buy a stake under a deal that appeared to have the blessing of President Vladimir Putin.

A revision, announced on Tuesday by Norilsk and Deripaska’s Hong Kong-listed aluminum producer RUSAL (0486.HK), would see Abramovich buy a slightly smaller stake, but pay for it directly to the two billionaires’ firms, rather than Norilsk.

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Will the real Norilsk owner please stand up? – by Andy Home (Reuters U.S. – December 7, 2012)

http://www.reuters.com/

Dec 7 (Reuters) – The Economist Intelligence Unit (EIU) has just issued a report on doing business in Russia.

“Nothing ventured, nothing gained: Changing international perceptions of Russian business” is based on a survey of 195 senior executives from outside Russia, with particular focus on those who have been or are considering joint venturing with Russian corporates.

“Non-Russian executives have decidedly mixed views of their Russian partners,” the report notes, explaining: “Access to energy and financial resources, and technical know-how, are the big pluses (…) poor language skills, inefficient management and corporate governance are the big minuses.”

Third on the EIU’s recommended list of nine ways for Russian companies to break free of outsiders’ “stereotypes” is to “avoid ‘insider’ practices and back-room deals”. Oh, and one other thing. The study was commissioned by Russian aluminium giant UC RUSAL and is available for download from the company’s website (www.rusal.com).

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Russia re-embraces a cold war — in the North – by Paul Watson (Toronto Star – December 17, 2011)

The Toronto Star, has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

MURMANSK, Russia— In the noonday twilight, as dockworkers squint through the gloom to move mountainous heaps of coal bound for Europe, the hum of Arctic power is unmistakable.

The stevedores labour in the damp cold, 200 kilometres north of the Arctic Circle, part of the vanguard leading Russia’s latest push to build its future on the rich resources of the Far North.

Grab buckets with massive steel jaws, dangling from yellow cranes several storeys high, chomp at mounds of coal, iron ore pellets and other bulk cargo steadily replenished by a stream of trains from the south. And this is a slow winter’s day.

Russians stopped wondering about whether to develop the Arctic generations ago. The only question now is, how fast can progress march?

The Kremlin has declared the Arctic critical to the country’s 21st-century economy and national security. And it is risking billions on a strategy to reverse years of neglect and decline in its Far North.

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Warming Revives Dream of Sea Route in Russian Arctic [Mining Transportation] – by Andrew E. Kramer (New York Times – October 17, 2011)

The New York Times has the third highest weekday circulation in the United States (after USA Today and the Wall Street Journal) and is one of the country’s most influential newspapers.

ARKHANGELSK, Russia — Rounding the northernmost tip of Russia in his oceangoing tugboat this summer, Capt. Vladimir V. Bozanov saw plenty of walruses, some pods of beluga whales and in the distance a few icebergs.

One thing Captain Bozanov did not encounter while towing an industrial barge 2,300 miles across the Arctic Ocean was solid ice blocking his path anywhere along the route. Ten years ago, he said, an ice-free passage, even at the peak of summer, was exceptionally rare.

But environmental scientists say there is now no doubt that global warming is shrinking the Arctic ice pack, opening new sea lanes and making the few previously navigable routes near shore accessible more months of the year. And whatever the grim environmental repercussions of greenhouse gas, companies in Russia and other countries around the Arctic Ocean are mining that dark cloud’s silver lining by finding new opportunities for commerce and trade.

Oil companies might be the most likely beneficiaries, as the receding polar ice cap opens more of the sea floor to exploration. The oil giant Exxon Mobil recently signed a sweeping deal to drill in the Russian sector of the Arctic Ocean. But shipping, mining and fishing ventures are also looking farther north than ever before.

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An Overview of Nickel in 2011 – Excerpt From Global Mining Finance 2011

Global Mining Finance was created four years ago as an annual book to provide international mining executives and their peers in the financial community with an overview of the industry from a World-wide perspective. For the main website: http://www.globalminingfinance.com/past-editions.html

The following research on nickel was provided by Paradigm Capital, a research-driven investment dealer, providing Research, Trade Execution and Investment Banking services.

Commodity Focus – Nickel

Two-thirds of all nickel produced goes into stainless steel, but is also important in the world of hi-tech where the soft magnetic properties of nickel and its alloys are employed. In this article, Paradigm Capital takes a look at the market for nickel.

Demand: Driven by The Stainless Steel Recovery

Nickel has a high rate of recyclability, This distinction is often made between the use of newly produced metal and recycled scrap. By far the most important first use of nickel is the production of stainless steel which accounts for over 60% of total demand with other first-use sectors being alloys, casting, electroplating, chemicals and batteries. The stainless steel sector is growing at a CAGR of about 5-6% per annum.

The nickel market rebounded strongly in 2010 compared to a very weak 2009, as a result of improved stainless steel demand conditions in combination with an amplified restocking period. In addition, the austenitic ratio (i.e. nickel bearing stainless steel) which has traditionally run at around the 75% level, has slipped lower. This was due to nickel’s meteoric price rise in 2007 to $25/lb. which proved to be the catalyst that triggered substitution, particularly into lower nickel bearing intra stainless steel grades. This proved to be one of the double whammies.

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Norilsk Nickel CEO Denis Morozov on Sustainable Mining

OJSC MMC Norilsk Nickel General Director, Chairman of the Management Board Denis S. MorozovThe following excerpt by General Director, Chairman of the Management Board Denis S. Morozov is from the OJSC MMC Norilsk Nickel 2007 Social Report which is available at: Norilsk Nickel 2007 Social Report

Dear readers,

OJSC MMC Norilsk Nickel is pleased to present the social report for 2007 which represents another step forward by the company in disclosing information regarding various aspects of its operations and activities concerned with sustainable development. At the core of our development strategy and our everyday business is the belief that consistent observance of social responsibility principles is a prerequisite for sustained and effective development of business.

In 2007, the Company continued the successful implementation of the adopted development strategy, modernised the existing production facilities, provided for further development of the unique resource base and entry to the Russia’s new regions.

In 2007, the Company significantly expanded the geography of its operations. OJSC MMC Norilsk Nickel successfully completed the transaction to acquire nickel business of OM Group Inc. and consolidated 100% shares of LionOre Mining International Ltd.1

The purchase of LionOre is the largest foreign acquisition in the history of Russian business. Today, MMC Norilsk Nickel is a leader of international metal markets with excellent outlook for further development.

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Norilsk Nickel CEO Denis Morozov – Beijing China Mining Conference Speech, 14th November 2007

Growth and Diversity: The Changing Face of Global Mining

Introduction

Ladies and Gentlemen. It is an honour for Norilsk Nickel to present at this conference. This is our first major corporate presentation in China.

Could I begin by extending my congratulations to the organisers for the work they have put into the preparation of the conference and for helping to reinforce the reputation of China Mining as one of the premier events in the mining industry’s calendar.

For those not familiar with the name, Norilsk Nickel is Russia’s leading mining company and the world’s largest producer of nickel and palladium. It is also a major producer of copper, cobalt, platinum, and a host of minor metals from operations in the far north of Russia on the Taimyr and Kola peninsulas.

The company’s principal mining operations, located around the town of Norilsk, are extremely remote from other centres of population in Russia and exposed to some of the harshest conditions faced by miners anywhere in the world.

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Denis Morozov, General Director of MMC Norilsk Nickel – An Introduction

On April 3, 2007 Denis Morozov took up the post as General Director of MMC Norilsk Nickel. Mr. Morozov was previously Deputy General Director and Member of the Management Board of MMC Norilsk Nickel. Born on March 30, 1973, Mr. Morozov is married and has two children. He graduated with distinction from the Lomonosov Moscow …

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