CDB pledges loan to VEB for the Udokan copper deposit development project

In 2015, CDB proposed a loan to VEB for the Udokan copper deposit development project. The source of the claim came from the head of VEB. However, its unclear if the loan ever came to fruition. A later VEB source in 2019 stated that the financers of the project included VEB, Gazprombank and Sberbank, without any mention of CDB. It seems this project did not move beyond the status of Pledge. In October 2015, VEB reserved 13 billion rubles for the development of the Udokan mine deposit. The chairman of VEB announced that "...these funds shall be used for pre-project works, design and estimate documentation and formation of the project itself, and afterwards there will be financing." Baikal Mining Company LLC, or BMC, holds the license for the Udokan deposit. On July 11, 2019, BMC signed a 12 year, $1.79 billion syndicated loan. Gazprombank is the arranger and financial advisor for the agreement and is contributing $650 million. Besides, Gazprombank plans to raise foreign financing. Sberbank is contributing up to $650 million and VEB $490 million. VEB is also the loan manager in the syndicate. Construction began in early 2019 and the complex was scheduled to commence operations in 2022. However, it actually began operations as announced on August 10, 2020. The Udokan deposit in the Trans-Baikal region has one of the largest deposits of copper reserves in the world. The loan is intented to build an industrial integrated facility to process 36 million tones of ore per year. The project is to be implemented through the Baikal Mining Company. The total cost of the project is roughly $2.9 billion. Most of the funding is coming through loan syndicates (1.79 billion) while the remaining funds are coming from the Baikal Mining Company itself. Novaya Chara railway station is the nearest rail station and it is being upgraded by Russian Railways to accommodate the Udokan cargo handling. The first phase of the project, which will run from 2021-2033, is projected to produce 30,000t of copper, half of which will be cathode copper and the rest copper concentrate. In February 2019; VEB, Gazprombank, and Sberbank agreed to provide financing to BMC for the first phase of the project. BMC has also signed agreements with Industrial and Commercial Bank of China (ICBC), Bank for Development and Foreign Economic Affairs, VEB Engineering, and HOPU Investments for financing the copper project.

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8