New infrastructure plan is likely to delay Kaz Minerals’ Baimskaya copper project in Russia due to increase in the capital and operating costs of the project. The plan entails Kaz to spend an additional $600mn for infra including building a section of the port and a 200km road.
Russia’ Ministry for the Development of the Russian Far East and Arctic has proposed a new infrastructure plan for the Chukotka region. The multi-entity Complex Development Plan (CDP) includes infrastructure for Kaz Minerals’ Baimskaya project. According to Kaz’s estimates, the revised budget for the project including the tailings storage unit and the impact of an expected one-year delay is $8bn. However, the massive project is identified as a strategically and economically important project and is expected to benefit from state-funded power and transport infra, and tax incentives.
Baimskaya is among the world’s most significant under-developed copper assets. Kaz’s project with an annual ore processing capacity of 70mn mt is now expected to be completed by December 2027. The company’s Peschanka deposit under the Baimskaya licence area has JORC inferred resources of 9.5mn mt of copper of average grade 0.43%.
Earlier in October, Kaz Minerals’ Independent Committee agreed to be acquired by Nova Resources BV. The acquisition deal is expected to become effective in H1 2021, but is subject to the shareholders and regulatory approvals.