MOSCOW May 19 Russia's Norilsk Nickel
, the world's largest nickel and palladium producer,
is in talks with Russian banks on raising $1 billion to finance
a copper project, Norilsk's first deputy chief executive said.
Norilsk, controlled by tycoon Vladimir Potanin and aluminium
giant Rusal, recently approved the project to develop
Bystrinskoe copper deposit in Russia's Zabaikalsk region as part
of its strategy update.
The company has invested around $0.5 billion so far and
plans to raise the remaining $1 billion as a non-recourse debt.
Norilsk plans to start copper concentrate production at
Bystrinskoe in the third quarter 2017. Annual revenue is
expected to exceed $1 billion after reaching full capacity
production of 66,000 tonnes of copper concentrate and 219,000
troy ounces of gold concentrate in 2018.
Norilsk plans to develop the project alone, said Norilsk's
first deputy chief executive, Pavel Fedorov.
"We believe that partners are not necessary for this project
in the current market conditions," he told reporters on Friday
in comments approved for publication on Monday.
London copper hit its highest in 11 weeks on Monday
as China pledged to quicken the pace of financial reform,
supporting growth in demand for commodities as global exchange
supplies of the metal dry up.
Norilsk said it planned to suspend production at its old
Nickel plant in the town of Norilsk by 2016 and to compensate
the plant's production with other assets.
Norilsk is currently in talks with the government to share
the up to 4.5 billion roubles ($130 million) the company needs
to re-train and migrate 3,500 people who currently work at the
plant in Russia's Arctic.
It also plans to use its own semi-products rather than
supplies from third parties in its nickel refining plant
Harjavalta in Finland, Fedorov said.
Its 2016 and 2018 production target, announced in October,
remained unchanged, he added.
($1 = 34.7482 Russian Roubles)
(Reporting by Polina Devitt; Editing by Elizabeth Piper)