KEY ARTICLES

THE MEGAPROJECT FOR THE CREATION OF A NATIONAL MINING CLUSTER IS THE NEW STEP IN THE DEVELOPMENT OF THE ARCTIC ZONE OF RUSSIAN FEDERATION

Projects Journal № 2 (16) 2022
The transformation of the Arctic today is one of the fundamental processes that can change the region itself, as well as the structure of the world economy. It is the part of our planet, where the climate requires special efforts from people and equipment; where is the huge storehouse of resources that can globally change many negative trends that have developed in the world. Every year, the role of the Arctic region only increases due to resource opportunities, as well as due to the formation of new transport and logistics corridors that can significantly change the scheme of cargo transportation on the world map. Current trends also contribute to the increasing role of the Northern Sea Route as the most important transport artery.

RUSTITAN Group of Companies has been implementing a project in the Arctic zone of the Komi Republic for more than 15 years for the complex development of the Pyzhemskoye deposit, which is the largest in Russia and the world in terms of reserves of titanium and quartz raw materials. The implementation of this project is supported at the highest state level and is included in the Strategy for the Development of the Arctic Zone of Russian Federation and Ensuring National Security for the period up to 2035, approved by the decree of the Russian President.
Despite the fact that the Pyzhem deposit was discovered back in the 60s of the XX century, its main development is connected with the activities of RUSTITAN Group of Companies. The work done allowed the mining company to obtain a certificate of the discovery of the Pyzhem deposit in February 2021. It is characteristic that this event was timed to the 100th anniversary of Komi Republic.

Located on the territory of UstTsilemsky district of the Komi Republic, the deposit is one of the largest in Russia and the world in terms of reserves and resources of titanium and quartz (glass) raw materials. But, in addition to the main reserves, it is unique because it contains valuable associated minerals, such as zircon, iron, rare earth metals, manifestations of gold and diamonds. According to experts, the reserves of the field's resources will be sufficient for its continuous operation for more than 500 years. Thus, the project implemented today by RUSTITAN Group of Companies is a powerful foundation that will provide a number of high–tech industries with raw materials for many generations to come. A systematic approach to the development of the field allows us to talk about a serious reserve for the creation of promising processing industries on the basis of the field.

«The reserves of titanium ores of Pyzhem deposit are genuinely huge. This is confirmed by the assessments of major global players. Everyone unanimously confirmed that there are no more such reserves in the world either in terms of the volume or quality of ore.” Anatoly Tkachuk, President of RUSTITAN Group of Companies.

Today RUSTITAN Group of Companies faces a really serious task: not only to start mining valuable raw materials for many industries in the remote region of Russia, but also to build several modern enterprises, create an efficient infrastructure and even a new urban-type settlement Umba for the company's employees.

RUSTITAN Group of Companies takes into account the peculiarities of the deposit, as well as a number of institutes of Russian Academy of Sciences has created a unique technology for the enrichment of titanium ores and the production of highgrade commodity products. The work is planned for 2023-2027 on the design of the enterprise and infrastructure, its construction and commissioning of production. In 2028, Pyzhemsk deposit is planned to be put into commercial development.

The national mining cluster (NMC) formed by RUSTITAN Group of Companies on the basis of Pyzhem titanium deposit provides for the creation of a multidisciplinary production for the production of high-quality concentrates of porous rutile, zircon, iron oxide, needle wollastonite, calcined quartz sands, glass sands, titanium dioxide, as well as titanium powders for additive 3D printing technologies.

The mining project is aimed at consumers and manufacturers in aerospace, shipbuilding, automotive, oil and gas, paint and chemical industries. The cluster will be based on the projected vertically integrated mining and metallurgical complex for processing titanium ores and quartz (glass) sands of Pyzhemsk deposit. The basic goal of the cluster is to create an industrial platform for the implementation of large industrial and raw materials projects in the Arctic zone of Russia in the interests of the development of the Arctic, the Northern Sea Route and the Northern Latitudinal Course, as well as the socio-economic development of Komi Republic and the Nenets Autonomous Area.

It is the need to form new transport corridors and routes that ensure efficient logistics in the Arctic, as well as the potential for industrial development of Pizhemsk deposit, that revealed the need to form an integrated infrastructure megaproject named "The creation of the national mining cluster with the construction of the deep–water seaport of Indiga and Sosnogorsk-Indiga railway in the Arctic zone of Russian Federation".

«This project is strategically important for our region. The national mining cluster with transport infrastructure will appear on our territory. This will significantly accelerate the socio-economic development of Komi, will allow to start new and expand existing projects.” Vladimir Uyba, Head of Komi Republic.

The new railway line, which will connect the projected Indiga port and existing Sosnogorsk station of the Northern Railway, in the future will provide passage and transshipment of cargo traffic of 67 million tons per year in the interests of the development of the Northern Sea Route. The passage of the railway through Pyzhemsk deposit solves some of the most important issues of providing it with the necessary This project is strategically important for our region. The national mining cluster with transport infrastructure will appear on our territory. This will significantly accelerate the socio-economic development of Komi, will allow to start new and expand existing projects.” Vladimir Uyba, Head of Komi Republic Projects EURASIAN FINANCIAL & ECONOMIC HERALD | #2 (16) 2022 45 resources, as well as the export of marketable products. It should be noted that the projected section of the railway will also have an approach to the Northern Latitudinal Course, which significantly expands the potential of this transport and logistics solution, fitting it into the global logistics system.

«Of course, today we are talking not only about the work of the national mining cluster, but also about its orientation to projects in a number of industries - military space, shipbuilding, paint and others. In this regard, the demand for the NMC products will only increase. The second part of the project is Sosnogorsk–Indiga railway. We speak a lot about the orientation of cargo traffic to East, but we cannot do anything without such additional latitudinal routes. Additional vertical transport corridors are needed. This branch will allow us to close a number of cargoes to the Northern Sea Route. Indiga itself is a port of great opportunities, where there is no big ice. It is important on the Northern Sea Route and allows a comprehensive approach to the development of Nenets Autonomous Area.” Alexander Shokhin, President of Russian Union of Industrialists and Entrepreneurs.

In fact, Sosnogorsk – Indiga railway will become a strategic transport artery that will significantly increase the cargo flows of the Northern Sea Route, ensure the reproduction of mineral resource base, create conditions for the exploration and exploitation of deposits, as well as the extraction of resources in Komi Republic and Nenets Autonomous Area in the interests of the development of the Arctic region of Russian Federation.

One of the most important elements of the megaproject is the construction of the ice-free deep-water seaport of Indiga in Nenets Autonomous Area. This project is being implemented by the AEON Infrastructure Corporation – also within the framework of the Strategy for the Development of the Arctic Zone of Russian Federation and Ensuring National Security for the period up to 2035. The implementation of the project requires the creation of a new access point to the Northern Sea Route in the western part of the Arctic zone – a universal seaport with unlimited opportunities to increase cargo turnover and its development. AEON Corporation is a unique combination of a private equity fund and a management company specializing in the crisis management of large industrial assets. This allows us to provide an exclusively professional approach to the implementation of the project.

The choice of a place for the construction of the port is due to a number of unique natural features that combine in an extremely positive way. First, owing to the Gulf Stream, there is a light ice situation in the area of the projected port of Indiga. Second, the place is characterized by acceptable natural depths, rocky base of the water area, the calm relief of the coastline. Third, there are sources of construction materials in almost unlimited quantities. Fourth, there are no permafrost manifestations Of course, today we are talking not only about the work of the national mining cluster, but also about its orientation to projects in a number of industries - military space, shipbuilding, paint and others. In this regard, the demand for the NMC products will only increase.

The second part of the project is Sosnogorsk–Indiga railway. We speak a lot about the orientation of cargo traffic to East, but we cannot do anything without such additional latitudinal routes. Additional vertical transport corridors are needed. This branch will allow us to close a number of cargoes to the Northern Sea Route. Indiga itself is a port of great opportunities, where there is no big ice. It is important on the Northern Sea Route and allows a comprehensive approach to the development of Nenets Autonomous Area.” Alexander Shokhin, President of Russian Union of Industrialists and Entrepreneurs 46 that require special technical solutions. Fifth, there is no factor of sand and silt drift in the water area, and therefore periodic dredging will not be required. Sixth, there are no restrictions on the expansion of port infrastructure both along the coast and in depth. Seventh, it is possible to create an accompanying infrastructure of logistics centers, the enterprises of the deep processing of mineral raw materials, a universal port railway station.

«Nenets Autonomous Area is a transport corridor through which goods will go to the Northern Sea Route. For this purpose, Sosnogorsk – Indiga railway line, a seaport and infrastructure in the Indiga area will be created. Our district is traditionally perceived as a raw material base of hydrocarbons – oil and gas. And now, by participating in this project, we are creating a new industry in our economy. In fact, we are diversifying our economy, including the transport and logistics component, which will certainly give the green light for the implementation of new projects and investments in the district.” Yuriy Bezdudnyi, Governor of Nenets Autonomous Area.

Thus, the construction of the ice-free port of Indiga within the framework of the megaproject will significantly ensure the growing potential of year-round use of the Northern Sea Route in order to increase the volume of movement of mineral resources and minerals of the Arctic zone. At the same time, the port's potential goes far beyond the Arctic and will be in demand by many regions of Russia, as well as foreign partners interested in moving cargo along the Northern Sea Route.
In order to implement the Megaproject of RUSTITAN Group of Companies, a consortium was created, which includes IC AEON and a financial consultant represented by AO InfraVEB.

Rustitan Group of Companies systematically interacts with the leadership of Komi Republic and Nenets Autonomous Area, relevant ministries and departments, financial and technological partners. An important factor is the support of the project by Russian Union of Industrialists and Entrepreneurs, which, for its part, is also actively working on topical issues.

The megaproject named "The creation of the national mining cluster with the construction of Indiga deepwater seaport and Sosnogorsk– Indiga railway in the Arctic zone of Russian Federation" has strategic importance for Russia, as well as for a large list of other states in need of affordable high-quality raw materials and finished products of various degrees of conversion. Given the great potential, all the projects included in the megaproject have a high investment attractiveness for Russian and foreign investors. It is important that in the conditions of redistribution of resources and logistics corridors, the implementation of such a large-scale project will open up new horizons for business development in various industries.