Nornickel develops metal production in Russia
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Nornickel develops metal production in Russia

December 17, 2024

The company is implementing a strategy of moderate growth.

#ARCTIC. #SIBERIA. THIS IS TAIMYR. In an interview with RBC, Vladimir Potanin, Nornickel president, spoke about the situation in the country’s economy and commented on the company’s position in the current environment.

According to Vladimir Potanin, Nornickel retains its growth strategy. For the time being it has put the strategy of aggressive growth in reserve, but it is not switching to the strategy of survival, but remains in the strategy of moderate growth.

“To implement it, we need to be as efficient as possible and produce what is in demand in the market, what is sold at a premium, not at a discount”, Vladimir Potanin said.

After the complication of the geopolitical situation and a sharp decline in access to Western equipment and technologies, Nornickel said that only an unconventional move would help solve the problems.

The company adjusted its development strategy, then updated its plans, refining them to take into account points important for Russia to get support from the authorities for closer cooperation with China, the company’s president continued.

“We have somewhat adjusted the strategy I spoke about in the spring to get more tightly involved with Chinese partners to produce something together. To get deeper into co-operation, we needed the support of the state, the government, all the way up to the president. Trying to get this support, we took into account in our strategy those points that were important for the state: preservation of the tax base and jobs, as well as preservation of competences. That is, in addition to production abroad, the company is developing production in Russia. For example, we not only maintain the volume of smelting capacity in Norilsk, but also increase it through the expansion of the Nadezhda metallurgical plant. We also continue to ensure the utilisation of enterprises that work in cooperation with us, such as the Krasnoyarsk non-ferrous metals plant. By adjusting our programme in this way and responding to the challenges that the government pointed out to us, we were able to receive support”, said Vladimir Potanin.

According to Nornickel president, the strategy of moderate growth envisages a 20-30 per cent increase in metal production, with diversified production. The expansion of smelting capacities allows the Russian Federation to retain competences in metal production that significantly exceed the existing needs. Currently, the domestic market uses about 20-25 percent of nickel and copper produced in the country.

By 2028, Nornickel expects to increase its tax base by 60 billion roubles per year. By 2030, the number of jobs in the company will increase by 4.5 thousand.

Commenting on the fulfilment of the environmental commitments undertaken by Nornickel, the company’s president noted that the main investments in the Sulphur Programme were made before the geopolitical situation tightened.

“This is a fortunate case when we have already managed to make the bulk of investments, and at the Nadezhda metallurgical plant, where all metallurgy will be concentrated, treatment facilities have been built, this year we are capturing 377 thousand tons of sulphur. And further on we will fulfil our commitments to reduce emissions by 90 percent”, said Vladimir Potanin. “Using a combination of several factors, we managed to solve the problem without asking the government to give us cheap money or allow us not to do something we promised to do”, he said.

Potanin said Nornickel’s team deserves praising for not asking the government and not reneging on its commitments with limited access to resources. The company has solved a serious problem through the intelligence of its employees.

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Text: Larisa Fedishina, Photo: Nornickel Polar Division’s press service

December 17, 2024

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