Russian Nornickel Nears Agreement for New Copper Plant in China

Foreks - Russia's largest mining company MMC Norilsk Nickel (Nornickel) is reportedly in talks to establish a large copper smelting facility on China's southern coast. Sources who spoke to Bloomberg News indicated that the facility, to be located in the port city of Fangchenggang in the Guangxi region, will produce 500,000 tons of refined copper annually using concentrate shipped from Russia.

The company's president, Vladimir Potanin, stated in April that Nornickel has been exploring options for joint projects in China since at least the beginning of this year, and noted that sanctions on Russian commodities have deepened. Sources did not disclose the name of the Chinese entity involved in the discussions with Norilsk.

In addition to other options, sources mentioned that the Russian firm had previously discussed using existing smelting facilities to process Russian concentrate with at least two other Chinese companies. One source indicated that this path is no longer being considered, and Nornickel is now focusing on building a facility from scratch. However, the plan is not yet finalized and is still subject to change.

Nornickel's press service declined to comment. While Nornickel is not under sanctions from the West, the U.S. and the U.K. have imposed restrictions on the trade of aluminum, copper, and nickel produced in Russia to prevent President Vladimir Putin from financing the war against Ukraine.

In the first nine months of the year, China imported approximately 165,000 tons of Russian refined copper, representing a more than one-third decline compared to the same period in 2023.