MOSCOW, July 13 (Reuters) - Russian potash miner Uralkali (URKA.MM) has rekindled plans to build a major new mine after winning a two-year extension to a deadline for developing its portion of the largest potash deposit outside Canada.
Uralkali said on Monday it had until May 15, 2011 to prepare its design plan for a mine at the Ust-Yaivinsky field, which should then be brought into production by Aug. 15, 2018. The extension was granted by Russia’s subsoil agency, Rosnedra.
The mine’s capacity will be lower than previously envisaged but allows Uralkali, which accounts for a third of global potash exports through its Belarus-based export agent, to revisit a plan seemingly abandoned last year on environmental grounds.
“Our negotiations with the representatives of the state authorities were thorough. We have succeeded in reaching an agreement suitable to both parties involved: the subsoil user and the government,” Uralkali CEO Vladislav Baumgertner said.
Uralkali said in December it would link the Ust-Yaivinsky field to its existing Mine 2, thus abandoning a $3 billion plan to build the separate Mine 5, due to the financial crisis and new legislation on the use of forested land. [ID:nLC746608]
This revised plan was rejected due to technical and environmental risks, Uralkali said, but amendments to the forestry law approved in March by President Dmitry Medvedev allowed the company to obtain land in the so-called green zone. Uralkali said capacity of the new mine would be lower than previously envisaged, but higher than the total demanded by its licence. The company did not disclose the planned capacity or the amount of investment required for the revised project.
The Ust-Yaivinsky field in the Ural mountains is part of the larger Verkhnekamskoye potash deposit, the largest outside the Canadian province of Saskatchewan. Potash is a soil nutrient used in fertilisers.