Norilsk Nickel has turned to ‘friendly’ jurisdictions for the differentiation of its international business depending on efficiency and competencies. The Russian side will focus on mining and processing, and some enterprises will be moved closer to sales markets, said Vladimir Potanin, President of Norilsk Nickel, in the company's channel on the Telegram social network.
The company plans to partially move its production from the Copper Plant to China. Thus, the mined materials will be brought closer to the main consumer and the resulting product will be sold as Chinese. In addition, the transfer of part of the production to China will help to completely resolve the issue of sulfur dioxide emissions.
As part of the implementation of the Sulfur Program, Norilsk Nickel will fulfill its environmental obligations in full. After reaching the design targets, emissions in Norilsk will be reduced by 45%, which means the capture of almost 1 million tons of sulfur dioxide.
"This is a new understanding of how the international division of labor should work. We negotiate with ‘friendly’ jurisdictions on who is more efficient in what, while maintaining the entire chain of competence. A win-win situation. Norilsk Nickel will focus on competencies that are most profitable and efficient for us - mining and processing. We transfer our environmental problems, problems of calculations, market access and customization of our goods for the consumer market to China, where they are solved most efficiently," Potanin explained.
After moving the smelting production closer to the sales markets, the company has the opportunity to master technologies for the production of battery materials. With these technologies, Norilsk Nickel, together with Rosatom, will produce both cathode materials and batteries themselves, using the products of the Kolmozersk lithium deposit for this purpose.
The company says this strategy is not aimed at the closure of one particular enterprise, but rather at changes in approach to management, partnerships, the international division of labor, and at the creation of value chains on a completely different basis. "The construction of production facilities in China is synchronized with the retirement of capacities at the Copper Plant. This will happen beyond 2027, before that we are already implementing our Chinese project. Therefore, in terms of production plans and volumes, the process will be neutral. In the future, we expect an overall increase in output due to increased production and processing," Potanin explained.
The transfer of production capacities will eliminate an obstacle to the further development of the entire Talnakh and Norilsk industrial district. Instead of outdated melting units, modern plants for processing, drying and storing metal concentrates, as well as industrial 3D printers, will operate on the territory of the plant. Anyone who wants to continue working in the company will be employed.
According to Norilsk Nickel's calculations, the implementation of this project will help increase revenue by 20% compared to the period before 2022. In fact, within four years, the company expects to increase its earnings by 1.5 times compared to its current state, and by 20% when compared to 2-4 years ago, 1prime.ru reports.
Alex Shishlo for Rough&Polished
