Slide 1
Russian Coking Coal Developments
– An Update
Presented by
John P L Bacharach, Director, IMC Montan, Moscow
19-20 June 2013
Slide 4
Summary of ProjectsRef Name Developer Location Coal
Type
Reserves
(mt)
Mining Method Full
Capacity
(mtpa)
Approx
CAPEX
($b)
Rail Distance
to Connect
(km)
Target Market
1 Apsatskoye SUEK Nr Chara, Chita C&T +/-425 Surface &
underground
6.8 1 Short China
2 Central Severstal Nr Kyzyl, Tyva C +/-630 Underground 7-12 1.8 As Elegest Asia Pacific
3 Denisovsky Kolmar Nr Neryungri,
Sakha
C 256 Surface &
underground
2 0.3 Short CIS,
Asia Pasific
4 Elegest Tyvinskaya
Invest
Corporation
Nr Kyzyl, Tyva C +/-760 Underground 18 1.8 405 Russia &
Export
5 Elga Mechel Mining 370km west of
Nerungri, Sakha
C&T +/-2000 Surface 27 3.8 315 Asia Pacific
6 Inaglinsky Kolmar Nr Neryungri,
Sakha
C 722 Surface &
underground
10.5 1.5 5.7 to
existing
CIS,
Asia Pasific
7 Kaa-Khem Mine En + Nr Kyzyl, Tyva C +/-200 Surface &
underground
3-5 1 As Elegest Asia Pacific
8 Mezhegeiskoye
Vostochny
Evraz Group Nr Kyzyl, Tyva C +/-400 Underground 7-12 1.8 As Elegest Asia Pacific
9 Usinskoye 1 Severstal Nr Vorkuta, Komi C +/-620 Underground 4.0 1 30 to
existing
Russian
Steel Plants
10 Usinskoye 3 NLMK Nr Vorkuta, Komi C +/-225 Underground 4.5 1.5 3 from
existing
Russian
Steel Plants
Slide 5
Ref 1. Apsatskoye – Update
Operator SUEK is Russia’s largest
thermal coal producer
Industrial scale washing tests carried
out
Geologocal exploration stage
completed 2011 – 2012 and confirms
425 mt of reserves
Project and design stages ongoing
Coking coal production of 0.5mt
planned for 2013
Developer Location Coal Type Reserves
(mt)
Mining Method Full Capacity
(mtpa)
Approx
CAPEX
($b)
Rail Distance
to Connect
(km)
Target Market
SUEK Nr Chara,
Chita
C&T +/-425 Surface &
underground
6.8 1 Short China
Slide 6
Ref 2. Central
Exploration is ongoing
PFS to be completed in 2013
Detailed exploration results to be
approved by GKZ in 2014
No final decision on the timeline
of the project development
Developer Location Coal Type Reserves
(mt)
Mining Method Full Capacity
(mtpa)
Approx
CAPEX
($b)
Rail Distance
to Connect
(km)
Target Market
Severstal Nr Kyzyl,
Tyva
C +/-630 Underground 7-12 1.8 As Elegest Asia Pacific
Slide 7
Ref 3. DenisovskyDeveloper Location Coal Type Reserves
(mt)
Mining Method Full Capacity
(mtpa)
Approx
CAPEX
($b)
Rail Distance
to Connect
(km)
Target Market
Kolmar Nr Neryungri,
Sakha
C 256 Surface &
underground
2 0.3 Short CIS,
Asia Pasific
Project includes construction of
washing plant
Mining started in 2009
Washing plant design ongoing
R&P mining method
Planned production of 2 mta for
2015
Slide 8
Ref 4. Elegest – Update
Being developed by Tyvinskaya
Invest Corp (formerly by EPK)
Railroad project was approved and
construction started in 2011, with
estimated completion 2016
Licensing process will be finalised
during 2013
Original CAPEX planned $1bn, now
expected to be up to $1.8bn
Developer Location Coal Type Reserves
(mt)
Mining Method Full
Capacity
(mtpa)
Approx
CAPEX
($b)
Rail Distance
to Connect
(km)
Target Market
License to be
Auctioned
(April 2013)
Nr Kyzyl,
Tyva
C +/-760 Underground 18 1.8 405 Russia &
Export
Slide 9
Ref 5. Elga – Update
More than 290km railroad
completed
Large-scale washing test at
Nerungri satisfactory
Planned production for 2013 –
more than 2mt
Total production capacity 27mt
planned from 2022
Developer Location Coal Type Reserves
(mt)
Mining Method Full Capacity
(mtpa)
Approx
CAPEX
($b)
Rail Distance
to Connect
(km)
Target Market
Mechel
Mining
370km west of
Nerungri, Sakha
C&T +/-2000 Surface 27 3.8 315 Asia Pacific
Slide 10
Ref 6. InaglinskyDeveloper Location Coal Type Reserves
(mt)
Mining Method Full Capacity
(mtpa)
Approx
CAPEX
($b)
Rail Distance
to Connect
(km)
Target Market
Kolmar Nr
Neryungri,
Sakha
C 722 Surface &
undergroun
d
10.5 1.5 5.7 to
existing
CIS,
Asia Pasific
Project includes construction of
washing facilities
Mine construction started in
2011
Railroad project is underway
Start production in 2016
Reaching project capacity by
2020
Slide 11
Ref 7. Kaa-Khem
License acquired by Tyvinskaya
Mining Company (En +)
Geological Exploration ongoing
Scoping Study for underground
mine to be commissioned
Developer Location Coal Type Reserves
(mt)
Mining Method Full Capacity
(mtpa)
Approx
CAPEX
($b)
Rail Distance
to Connect
(km)
Target Market
En + Nr Kyzyl, Tyva C +/-200 Surface &
underground
3-5 1 As Elegest Asia Pacific
Slide 12
Ref 8. Mezhegeiskoye/Vostochny
Scoping study completed
Gazprombank lent +/-$200m
over 7 years on project finance
basis
Initial production planned for
2013 with full production 2014
Possibility of delays as Evraz has
consolidated 82% of
Raspadskaya
Developer Location Coal Type Reserves
(mt)
Mining Method Full Capacity
(mtpa)
Approx
CAPEX
($b)
Rail Distance to
Connect
(km)
Target
Market
Evraz
Group
Nr Kyzyl,
Tyva
C +/-400 Underground 7-12 1.8 As Elegest Asia
Pacific
Slide 13
Ref 9. Usinskoye 1 – Update
Licence acquired by Vorkutaugol
in 2011
Exploration works completed in
2012
PFS is underway
Developer Location Coal Type Reserves
(mt)
Mining Method Full
Capacity
(mtpa)
Approx
CAPEX
($b)
Rail Distance
to Connect
(km)
Target Market
Severstal Nr Vorkuta,
Komi
C +/-620 Underground 4-5 1 30 to
existing
Russian
Steel Plants
Slide 14
Ref 10. Usinskoye 3 – Update
Further exploration being
undertaken
Scoping Study soon, with
Feasibility Study to follow
Start of geological exploration
2014
Start of mining expected 2017 or
later
Developer Location Coal Type Reserves
(mt)
Mining Method Full Capacity
(mtpa)
Approx
CAPEX
($b)
Rail Distance
to Connect
(km)
Target Market
NLMK Nr Vorkuta,
Komi
C +/-225 Underground 4.5 1.5 3 from
existing
Russian
Steel Plants
Slide 15
Summary The projects demonstrate huge perspective of
Russian coal industry
Potential development of almost 100mtpa capacity,
mostly in new regions
Further projects envisaged in other areas that
require infrastructure (Krasnoyarsk, Chukotka,
Magadan)
However, low investment activity in 2012-13 has
resulted in some delay to projects
Actual rate of development will be dependent
principally on steel demand and hence coking coal
requirements
Slide 16
Contact
John P L Bacharach
Director
IMC Montan
Chayanova 22, Block 4
Moscow 125047
Russia
Tel: +7 499 250 6717
Fax: +7 499 251 5962
E-mail: [email protected]