China Eximbank provides RMB 5.383 billion loan for Bystrinsky Copper Mining and Enrichment Plant (Linked to Record ID#66369, #95878, and #95879)

Project narrative

In July 2015, Vnesheconombank (VEB) Supervisory Board announced that it had approved an RMB 5,383,000,000 ($874 million) China Eximbank loan to GRK Bystrinskoye LLC — a special purpose vehicle and joint venture of PJSC MMC Norilsk Nickel (50.51% ownership stake), CIS Natural Resources Fund (36.6% ownership stake) and Highland Fund (13.3% ownership stake) — in the Bystrinsky Copper Mining and Enrichment Plant Project. Then, on September 2, 2015, China Eximbank and VEB signed an MOU on the project. The loan carried an 8-year maturity and an unknown interest rate. The borrower was expected to use the proceeds of the loan to partially finance the $1.378 billion project. The project consisted of an open-pit mine at the Bystrinskoye deposit; a mining and processing plant (MPP) with all associated infrastructure, including a power line and the 227 km Borzya–Gazimursky Zavod railway line; as well as a rotation camp. Upon completion, the mining and enrichment plant was expected to have the capacity to process 10 million tons of ore per year to produce copper, gold and magnetite concentrates. Construction of the open-pit mine and the MPP started in 2013. In 2017, a 220 kV power line was commissioned and a camp for 1,047 people was built. Hot commissioning of the MPP started in October 2017. Then, in May 2018, the mine shipped its first consignment of 680 tons of iron ore to China. At that point, the mine was running in pre-commissioning mode. The MPP came online in December 2019. The project was expected to ramp up to design capacity by 2021. The Bystrinsky GOK faces several environmental challenges, including pollution, biodiversity loss, and soil and water quality degradation. Heavy metals and arsenic contamination from industrial operations impact both terrestrial and aquatic ecosystems, with pollutant zones extending up to 20 km. Habitat fragmentation, expropriation of territories, and natural factors like severe floods exacerbate these effects, threatening local flora and fauna, including 32 protected species. Additionally, elevated arsenic levels in the soil hinder fertility, while dust and aerosol emissions contribute to further degradation. To address these issues, the facility has implemented advanced technologies, such as ash and dust collectors, electrostatic precipitators, and multi-stage wastewater treatment systems, achieving 92% water reuse. Safe waste management practices include geomembrane-lined landfills with drainage systems to prevent soil contamination. Renewable energy sources like hydropower, which already account for 34% of the energy mix, are being expanded with plans for solar power. The introduction of the Integral Ecosystem Indicator (IEI) enables continuous monitoring of biodiversity health, showing minimal losses in impacted areas. Collaboration with scientists has identified bioindicators, including the Maksimovich vole and Siberian frog, to monitor ecosystem changes effectively. Efforts are also supported by the nearby Uryumkan Nature Reserve, which helps preserve local biodiversity while minimizing industrial impacts. Through these measures, Bystrinsky GOK aims to balance sustainable operations with environmental conservation. The Bystrinsky GOK also stands as a vital contributor to the region's economic and social development. During the St. Petersburg International Economic Forum (SPIEF 2017), a social and economic cooperation agreement was signed between Nornickel and the regional government to support investment projects and boost the local economy. Once the plant reaches full capacity, it is expected to significantly increase tax revenues, potentially contributing RUB 4.68 billion to regional and local budgets over the next five years and RUB 18.4 billion in the next ten years, subject to favorable market conditions. In addition, Nornickel has committed RUB 3.29 billion to social projects in the region by 2027, focusing on education, healthcare, sports, and environmental protection, with funds managed through the Trans-Baikal Development Fund. The Bystrinsky project, with an investment of RUB 90 billion, has established state-of-the-art production facilities, including concentrators, open-pit mines, and a tailings pit, alongside a 227 km railway to support logistics. This development has created 2,000 direct jobs and an additional 1,500 outsourced positions. Nornickel’s contributions extend to welfare programs, increasing funding from RUB 1.85 billion to RUB 2.4 billion for 2021–2026. Initiatives include significant investments in children's hockey programs, pandemic relief efforts such as medical equipment and ambulances, and ongoing support for education, arts, and social development. These measures, coupled with the plant's efficient logistics and long resource life of over 30 years, underscore Nornickel’s role in fostering sustainable economic growth and community welfare in the Trans-Baikal Territory.