Norilsk Nickel is considering a joint venture with China Copper, a subsidiary of a major aluminum producer Chinalco, to build a copper smelter in China, according to sources cited by Reuters.
The news agency reports one of its sources as saying that China Copper executives visited Moscow in June to discuss a possible joint venture, but the details of the structure and investment are still under discussion.
Sites being considered in China include Fangchenggang and Qinzhou in the Guangxi region, the two sources said, with another source saying Qingdao in Shandong province was also possible.
A decision on a joint venture will be made over the next few months, a fifth source said, adding that Nornickel's Chinese output is likely to be consumed domestically.
The new facility will have capacity to produce 450,000 tonnes of copper annually, two of the sources said, amounting to around 2% of global mined supplies estimated at around 22 million metric tons this year.
Earlier in April, Nornickel’s president Vladimir Potanin said that the company 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.
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.
Theodor Lisovoy, Editor in Chief, Rough&Polished
