Russia to unify the requirements for foreign investors in the country’s largest mineral fields
The Russian government is desigining criteria for the provision of licenses for the development of the country’s largest mineral fields to the companies, which are controlled by foreign investors, according to press-service of the Russian Presidential Administration.
This has already been confirmed by Alexander Khloponin, Russia’s Deputy Prime Minister, which, according to his spokesman, has already instructed the Russian Ministry of Natural Resources to ease access for foreign investors for the development of Russian mineral resource base.
According to the current Russian legislation, and in particular the Russian federal law “On subsoils”, granting of licences for the development of Russian mineral fields of federal importance is impossible without the personal decision of the national government if the share of foreign capital in the stake of the potential investor exceeds 10%, however the government plans to lift this requirement already in the coming months.
Currently among the mineral fields of federal importance in Russia are uranium fields, high-purity quartz raw materials, REE (rare earth elements) of yttrium group, nickel, cobalt, tantalum, niobium, beryllium, lithium, diamond fields, platinum group metals as well as oil fields, with the reserves of 70 million tonnes, as well as gas fields with the 50 billion cubic meters of reserves.
In addition, these fields include gold fields with the reserves of 50 tonnes and copper fields with the reserves of 500,000 tonnes.
Russian analysts believe that the establishment of criteria will help to significantly ease access for foreigners to Russia’s mineral resources base and will allow to reduce the influence from Russian law enforcement agencies, and in particular the Russian Federal Security Service (FSB) and some conservative officials on this process. To date, conservatives from the Russian government have repeteadly criticized the proposal of the state to attract foreign investors for the development of Russia’s richest mineral reserves.
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For example, the proposal has even been criticized by Sergey Donskoy, Russia’s Minister of Natural Resources, according to which, such a move may associate with “threat to the defense and security of the state”, as Russia’s richest mineral reserves will pass into the control of foreigners.
According to Donskoy, instead of granting licenses, there is a need to unify the requirements for foreign investors, planning developing Russian mineral reserves, as well as to create conditions for the lifting of excessive administrative barriers in this field.
In addition, the Minister of Natural Resources has recently submitted a bill for the consideration of the national government, under which foreign companies will receive guarantees from the Russian federal government on the development of strategic fields, the discovery of which was completed by them.
It is planned that the approval of the bill should stimulate geological and exploration activities by foreigners in Russia.
Foreign companies rarely discovered major oil and gas fields in Russia. The latest example is the Nizhnechutinskoe oil field in the Russian Komi Republic (with the reserves of 100.1 million tonnes), which was discovered in 2008 by the British Timan Oil & Gas.
Eugene Gerden is an international free-lance writer, based in St. Petersburg, who specializes on writing in the field of mining, metals and rare earth metals. ... <Read more about Eugene Gerden>