Russia has begun production at the country’s largest untapped copper deposit. The Udokan project was opened during a ceremony that took place on 11 September.
The US imposed sanctions on the project’s operator, Udokan Copper, on 12 April, part of a series of measures aimed at limiting Russia’s ability to finance its ongoing war against Ukraine.
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Udokan Copper is owned by oligarch Alisher Burhanovich Usmanov’s company USM Holding; all of Usmanov’s companies have been sanctioned by the US.
The project is located in the Kalar District of the Trans-Baikal Region in the south-east of Russia. The Udokan plant will produce sulphide copper concentrate with a 40–50% metal concentrate, according to the company.
The first stage of the metallurgical plant is expected to be launched in 2024. It will handle up to 15 million metric tonnes (t) of ore per year with an annual production of up to 150,000t of copper in the form of copper cathode and concentrate.
The deposit has an estimated 26.7 million tonnes of copper. The project has faced several delays. In 2008, Usmanov bought the rights to develop the deposit for $500m (Rbs47.85bn) prior to the global financial crash. Since then, the project has faced many technical challenges.
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By GlobalDataThe copper ore located in the Udokan region is difficult to extract; the deposit was discovered in 1949 but was not developed as the technology needed to extract the ore did not yet exist.
Developers plan to build the second stage of the mining and metallurgical complex by 2028. It will have an annual capacity of 24–28 million tonnes of ore and up to 450,000t of copper.
The deposit is located on the border with China, which USM Holding sees at a major export market. “That is why with this project we initially viewed exports to the Asia-Pacific region, especially to China, which is the world’s largest – over 50% – consumer of copper,” said Erkozha Akylbel, CEO, speaking at the Eastern Economic Forum last year.
