Tuesday, October 5 2021 18:53
Naira Badalian

Total investment in the construction of a copper smelter, the second  open pit at ZCMC, an enrichment plant and a new nuclear power plant  of average capacity in Armenia is estimated at $ 3-3.5 billion

Total investment in the construction of a copper smelter, the second  open pit at ZCMC, an enrichment plant and a new nuclear power plant  of average capacity in Armenia is estimated at $ 3-3.5 billion

ArmInfo.The new shareholder of 60% of shares of Zangezur Copper- Molybdenum Combine (ZCMC), GeoProMining company, will build a copper smelter in Armenia, the  relevant decision has been made. The construction site has not yet  been determined. With the implementation of the plans, the total  volume of accumulated investments can reach $ 3.5 billion, said  member of the Board of Directors of GeoProMining and its owner Roman  Trotsenko on October 4 in an interview with the Public Television of  Armenia.

On September 30, by its resolution, the RA Cabinet of Ministers  accepted as a gift 25% of shares of "Industrial Company" JSC (a 100%  subsidiary of "GeoProMining Armenia" company), which make up 15% of  the total capital of ZCMC. As stated in a joint statement by  GeoProMining and the Government of Armenia, Roman Trotsenko announced  plans to expand cooperation with the Government of the Republic of  Armenia, and this is the first step within a broader investment  vision.

"Any major development in the mining industry is usually associated  with the interaction of business and the state. This is a common  practice when the state participates in the capital of a large mining  company, because many issues in the development of an enterprise are  limited to the state. These are mining and land allotments,  large-scale construction, including transport, social infrastructure.  Therefore, if we take the majority of the world's largest mining  companies, we will see the state as a shareholder, so we developed a  plan for the development of the copper industry in Armenia and  considered that the RA government should be a participant, a  shareholder of the enterprise. This was our balanced decision and we  are glad that the government responded to our plan, approved it and  made a decision to enter the capital, "Roman Trotsenko said during an  interview.

Having shared the shares, as the head of the company ZCMC explained,  he plans to receive a plan for the development of the copper industry  in Armenia, agreed for the next two decades, and guarantees for  predictable operating conditions, and that the state and the country  will be interested in the development of the mining industry.

According to Trotsenko, problems accumulated in the mining industry  of Armenia since Soviet times: the metal content in the ore dropped,  enterprises did not have the opportunity to re-equip technically,  that is, the equipment became outdated.  A modern copper smelter was  never built, which is why Armenia to this day sells not copper and  molybdenum, but low quality concentrate, that is, raw materials. At  the same time, Armenia buys copper in metal, in sheet, which is  certainly an inconvenient, strange coincidence, the source said.

Meanwhile, even in the Soviet Union, a plan was developed for the  construction of a large copper smelter.  According to Roman  Trotsenko, although the program has all the prerequisites, it was  never implemented.  "Today the transport scheme looks like that  concentrate is collected by cars from all over Armenia in Yerevan,  loaded on the railroad, goes to Poti and shipped through the port in  Poti to other factories and smelters that process it. It is  inconvenient and costly," - said the businessman.  As part of the  investment program, the company plans to expand production, make it  modern, solve energy supply issues, since modern production requires  a large amount of electricity. It is important that the  implementation of the program will have a large multiplier effect for  the Armenian economy. Smelter will produce not only export products,  but also provide the Armenian industry with copper. "We are ready to  tackle these issues, in the person of the Armenian government we have  a partner who is ready to deal with these issues with us," Trotsenko  said.

According to the head of the board of directors of GeoProMining, in  order to increase production and extracting, the company is  considering building a second open pit near ZCMC. "It will also  require the construction of an enrichment plant, a flotation plant  next to ZCMC. This will make it possible to achieve productivity  indicators of about 150 thousand tons of copper concentrate per year.   At the same time, as Trotsenko emphasized, the construction of a  modern smelter is a large capital- intensive structure, which will  cost about US $ 1.5 billion. You will have to choose a place for it,  look for, among other things, make a decision with the participation  of the Armenian government. "This is a complex issue, it concerns  seismicity, ecology, transport security. The decision has been made,"  he said.  Despite the large volume of required investments, the  construction of such a plant, as Trotsenko pointed out, is necessary,  otherwise Armenia will not be competitive in the sale of raw  materials and concentrate.  Trotsenko also touched upon the  construction of a new nuclear power plant (NPP) of medium capacity in  Armenia. There are studies, negotiations are underway with the  participation of Rosatom (Russian State Atomic Energy Corporation -  ed. note) on the construction of two units of a compact nuclear power  plant based on RITM-200N reactors. "This is a modern reactor, which  is very safe, it can be installed in difficult seismic conditions,  the power for each reactor is 115 MW, that is, we are talking about a  total capacity of 230 MW. This is a little more than what is needed  for our consumption, but this will allow building around other  enterprises that will be engaged in the subsequent processing of  copper ", he explained.

Following the implementation of the investment program, according to  the company's estimates, about 6 thousand more people will join the 8  thousand people employed today in the mining industry of Armenia.   "Copper, if you received a metal, and not a concentrate in powder,  allows you to master new, complex processing, such as the production  of electric motors, electrical engineering, components for cars,  electric batteries. This is what the economy of Armenia, where there  is a large number of hardworking, smart people who, moreover, are  good at doing something with their hands, will allow the formation of  a huge layer of small and medium-sized businesses that can work in  this direction, "he said.  Touching upon environmental risks, Roman  Trotsenko assured that over the past decades, serious technical  changes have taken place, for example, during the construction of  modern plants there are no emissions of pollutants, the production of  sulfuric acid, if it occurs, is completely utilized and exported.   The total volume of accumulated investments in connection with the  implementation of the outlined plans can reach $ 3.5 billion. Of  these, the volume of own investments will amount to $ 2 billion, the  construction of the nuclear power plant will require investments from  Rosatom - about $ 400 million, and borrowings will also be attracted.

To recall, the GeoProMining group of companies (GeoProMining) entered  Armenia in 2007, with the acquisition of GPM Gold, which operates the  Sotk gold deposit and the Ararat gold recovery plant. Then the  company acquired the Agarak Copper-Molybdenum Combine. The company  has invested about $ 400 million in the Armenian economy and has  become the largest private industrial investor in Armenia. The  investments were aimed at technical re-equipment and technological  modernization of two enterprises. The company has also committed more  than $ 10 million to various social projects as part of its Corporate  Social Responsibility program. Geopromining founder Siman Povarenkin  sold the company to businessman Roman Trotsenko, who entered the  company's capital in 2020.

Zangezur Copper Molybdenum Combine CJSC (ZCMC) is the largest mining  company in Armenia. The combine exploits the Kajaran  copper-molybdenum deposit. The deposits of ore are estimated for  about 150 years. The plant has been producing molybdenum and copper  concentrates. Copper concentrate contains 50% molybdenum, copper  content in copper concentrate - not less than 15%. 


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