Rosatom buys mining business from the group

Having not received a license to mine the ores of the Pavlovsk lead-zinc deposit in six years, the Summa group decided to sell the First Mining Company involved in the project to Atomenergoprom. To develop the deposit, approval from the Ministry of Defense is required, since the site on Novaya Zemlya is located within the boundaries of the Central Test Site of the Russian Federation. It is easier for Rosatom to solve the problem with the license, but for it the extraction of zinc and lead is a completely non-core business.

Atomenergoprom (part of Rosatom) will issue a loan to its subsidiary Atomredmetzoloto (ARMZ) to purchase 99.5% of CJSC First Mining Company. The loan amount, including interest (9.25% per annum), will be 1.1 billion rubles, term - until December 31, 2013. Summa and Rosatom declined to comment. “We are essentially talking about the sale of a license for the Pavlovskoye field,” a source familiar with the negotiations clarified to Kommersant, noting that the cost of the transaction has not yet been determined, “but in any case it will be sufficient for the company to recoup its investments and came out with a profit." According to him, after the approval of Summa’s strategy, the investment committee decided to exit the company from the mining business as a non-core business, identifying transport, logistics, engineering, construction and commodity trading as strategic areas.

ARMZ unites uranium mining enterprises, ranking second in the world in terms of resources (726.5 thousand tons of uranium as of January 1, 2011).

The First Mining Company (PGK) has been part of the Summa group of Ziyavudin Magomedov since 2006, its main asset is a license to explore the Pavlovskoye deposit on the Bezymyanny archipelago of Novaya Zemlya (Arkhangelsk region). Pavlovsky reserves put on the state balance sheet: 1.9 million tons of zinc, 0.5 million tons of lead, 672 tons of silver; the forecast reserves and resources of the Pavlovsk ore field are 21.4 million tons of metals. In addition, Summa holds a license for exploration and mining of ores at the Sardana deposit (Yakutia), its proven reserves are 1.9 million tons of zinc and 0.5 million tons of lead (no forecast data).

In 2008, Konstantin Koshkin, who served as vice president of Summa, told Kommersant that the development of the Pavlovskoye deposit would require about $600 million. The Summa project envisaged an annual production of 515 thousand tons of zinc concentrate with a metal content of 56% and 141 thousand . tons of lead concentrate (49%). Kommersant's sources do not say whether ARMZ will build on it or create a new project. The head of the industrial audit department of MEF-audit, Alexander Pobedash, notes that metallurgists’ mining and processing plant projects are now cheaper than in 2008, so the cost of the project should not increase. “But Pavlovskoye is located next to the Ministry of Defense test site, where many nuclear tests were carried out, and ARMZ may have difficulties creating production due to the high background radiation,” the expert adds.

It is precisely because of the location of the Pavlovsky Freight and Mining Company, which explored the field, that it still cannot obtain a license to produce there. This requires the approval of the Ministry of Defense, since Novaya Zemlya is the territory of the Central training ground of the Russian Federation subordinate to the ministry. In 2008, the then governor of the Arkhangelsk region, Ilya Mikhalchuk, petitioned Vladimir Putin for the “Summa,” but this did not help. According to Kommersant's information, it was partly because of this problem that Summa decided to sell Freight One.

“The Rosatom structure should have fewer problems with obtaining permits,” believes Alexey Morozov from UBS. But for Rosatom, the development of the Pavlovskoye field is also a completely non-core business, notes Alexander Pobedash. A Kommersant source familiar with the situation clarifies that ARMZ was created as a mining company and is now expanding its activities from uranium mining to other metals. “This year ARMZ produced the first gold at the Lunnoye deposit,” adds Kommersant’s interlocutor. According to him, lead and zinc are expected to be mined at the Pavlovskoye deposit.

In principle, the development of the deposit is promising, Alexey Morozov believes, mainly due to the presence of zinc - this industrial metal is in demand in developing markets (used in the production of rolled products for infrastructure and housing construction). But Alexander Pobedash points out that the project has complex logistics, so even with significant reserves of the field, the risks outweigh the prospects.

Anatoly Dzhumailo, Vladimir Dzaguto

The loot was subtracted from the "Sum"