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The Lead-Up to EEF: Far Eastern Mining Industry Up for Discussion

2 July 2021
В Хабаровске в рамках подготовки к ВЭФ обсудили развитие горнодобывающей отрасли Дальнего Востока

The online session ‘Sustainable Development of the Far Eastern Mining Industry: Technology, Prospects, and Environmental Security’ was held in Khabarovsk as part of the territory’s first Energy of the Far East Investment Forum, organized by the Government of Khabarovsk Territory and the regional Agency for Attracting Investment and Developing Innovation. The Ministry for the Development of the Russian Far East and Arctic, Far East Development Corporation, and the Roscongress Foundation served as co-organizers for one of the sessions held as part of the lead-up to the Eastern Economic Forum (EEF).

Participants of the event discussed measures to develop human capacity in the industry, the role of corporate social responsibility in implementing investment projects, and what the Russian Far Eastern mining industry must do to develop its mineral resource base.

As Acting Minister of Natural Resources of Khabarovsk Territory Elena Balezina noted, Khabarovsk Territory’s potential in the realm of mineral deposits, especially precious and nonferrous metals, is a driver of economic growth in the region: the mining sector amounts to 5% of the regional GDP. Mining enterprises are a significant contributor to tax revenue and job creators, providing fair wages to 10,000 people living in the Territory.

Mining sector businesses are actively involved in expanding the mineral resource base and launching new enterprises to extract gold and other minerals. Significant funds are being invested in geological exploration. «In 2020, RUB 8 billion were spent to this end, 97% of which came from the enterprises themselves. As a result, explored gold reserves increased by 106 tonnes in 2020. The industry’s investment plans for ‘mining precious and nonferrous metals’ are currently evaluated at approximately RUB 300 billion and includes 15 investment projects. In 2021 alone, the proposed volume of investment reported by enterprises amounts to RUB 72 billion, which is 1.7 times greater than in 2020. All of this indicates that the territory’s mining industry has serious development plans,» said Balezina.

An immediate action plan to restore pre-crisis dynamics and maintain incomes and jobs, approved by Acting Governor of Khabarovsk Territory Mikhail Degtyarev, identifies precious and non-ferrous metals mining as an especially promising industry and one of the economic drivers of Khabarovsk Territory.

The mining industry’s mid-term growth potential stems from six significant investment projects with a total investment volume of RUB 314 billion. They include the construction of a mineral processing plant on the Kutinsky gold deposit; modernization of Polymetal’s Amursk Hydrometallurgical Plant; construction of a mineral processing plant on Rusolovo’s Pravourmiysk tin deposit; construction of a mineral processing plant on the Russian Copper Company’s Malmyzh ore field; and Kinross’s Chulbatkan development project.

The Territory is expecting over RUB 62 billion in investment from these projects in 2021. Their total production capacity after launch will consist of 19.0 tonnes of gold, 272 tonnes of copper concentrate, and over 4.0 thousand tonnes of tin annually.

According to the First Deputy Head of the Department for Subsoil Use in the Far Eastern Federal District (Dalnedra) Valery Vologin, over 208 tonnes of gold, 1,243 tonnes of silver, 31.7 million tonnes of petroleum, 30.2 bcm of natural gas, and over 70 million tonnes of various types of coal were extracted in the FEFD in 2020. According to the expert, pioneering companies often drive development in the mining industry, such as in the case of the Chulbaktan project, when Kinross acquired untapped territory, invested money in geological exploration, and identified 32.8 tonnes of proved gold reserves and 100 tonnes of probable gold reserves.

Managing Director of Amursk Hydrometallurgical Plant Vadim Kipot spoke at the session about the enterprise’s staff training system. They see the answer to the plant’s staffing problem in systematic, professionally-oriented work with students and cooperation with vocational schools in Amursk and Sovetskaya Gavan to prepare in-demand specialists. The universities partnering with Amursk Hydrometallurgical Plant include Irkutsk National Research Technical University (INRTU), North-Eastern Federal University (NEFU), and Komsomolsk-na-Amure State University (KnASTU). According to the expert, high-quality training of specialists for current and prospective objectives is the key to ensuring the stable operation of the mining industry in the future.

Over 700 people representing businesses, executive bodies, government corporations and foundations, universities, and banks attended the Energy of the Far East Investment Forum. The Forum featured nine thematic spaces dedicated to promising investment areas, including those with preferential regimes in the region: agriculture, the timber and mining industries, small and medium-sized enterprises, tourism, construction, the innovation economy, and municipal-private partnerships.