EDITOR: | January 25th, 2017 | 1 Comment

Foreign investors wanted for Russia’s largest tin field

| January 25, 2017 | 1 Comment
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The Russian government is in a search of foreign investors for the development of Pyrkakaya field, Russia’s largest tin field, which is located in the Chukotka Republic.

According to initial state plans, the project should have been implemented by the Russian billionaire Roman Abramovich and his structures, however the businessman decided to leave the project.

Several days ago OOO “North tin”, the subsidiary of Abramovich, which owned a license on the development of the field until mid-2028, refused from further implementation of the project and transferred the license for its development to the Russian Federal Agency on Subsoil Usage (Rosnedra).

The reserves of the Pyrkakayskogo tin-bearing field, which is located in the Chaun district of Chukotka, are estimated at 228,500 tonnes of tin, which makes it the world’s fourth largest tin field. In addition, the field has the reserves of tungsten, which are varied in the range of 22,000-23,000 tonnes.

The beginning of the development of the field initially scheduled for 2017. The project involved building a processing complex with the capacity of about 6 million tonnes of ore per year and the production of 11,100 tonnes of tin and 814 tons of tungsten during the first stage of its implementation. The period of stable production at the field is estimated at 20 years.

The decision of Abramovich to leave the project has already forced the Russian government to start a search of alternative investors for the project, while among the possible options are several companies from China, the US and Canada. According to an official spokesman of the Russian Ministry of Energy, the talks are already underway, while their results will be announced later this year.

To date, Chinese Yunnan Tin Group, one of the world’s largest tin producers, has already refused from the participation in the project, considering it 0.25% metal content as too low and believing that the development of the field could be unprofitable for it.

In the meantime, the Russian government remains more optimistic, considering  that the production of tin at the field could be associated with significant profits for investors, taking into account that prices for the metal on the London Metal Exchange (LME) for the last 1.5 years have significantly increased from historical ten-year lows of US$13,600 per tonne to about US$21,000 tonnes.

Currently a significant part of tin fields in Russia are characterized by extremely low metal content. At the same this problem remains pressing for the entire Russian mining industry and the majority of its segments, which is mainly due to Soviet legacy, when a particular attention of the Soviet government paid to the volumes of production, instead of the quality, which resulted in the place on the state balance fields with low metal content.

According to data of Rusolovo, one of Russia’s leading tin producers, Russia’s annual tin demand is estimated at 7,500 tonnes, of which 90% is imported from abroad, and in particular China, Bolivia and Portugal.

At the same time, according to data of ITRI, one of the world’s leading analyst agencies in the field of tin, global refined tin consumption, is currently estimated at about 345,700 tonnes.


Eugene Gerden

Editor:

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>


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Comments

  • Mr Zakir hossain

    I want Russian investor for garments business.

    January 26, 2017 - 4:21 AM

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