Russia’s largest diversified mining and metals company, OJSC MMC Norilsk Nickel intends to establish a 400 000 t/y capacity copper smelting and processing facility in Indonesia. This was revealed recently when the Russian group signed a memorandum of understanding (MoU) with Indonesian company Nusantara Smelting Corporation. The MoU also covers the exploitation of copper/nickel orebodies in the South-East Asian country.

The signing of the MoU, earlier this month, followed after a meeting in Jakarta between Norilsk general director and management board chairperson Vladimir Strzhalkovsky, Indonesian Industry Minister Suleiman Mohamed Hidayat and Indonesia’s National Coordinating Committee on Investment chairperson Giryavanom Gita. Subsequently, Strzhalkovsky and his team also met with a local delegation headed by Russia-Indonesia Business Council cochairperson Luhut Panjaltan, during which the Indonesians expressed interest in buying Russian mining equipment.

Thereafter, the Norilsk head held talks with West Nusa Tenggara province governor Mohammed Zainul Majdi on the Russian company’s possible development of copper/nickel ores located there. The governor expressed his readiness to support Norilsk activities in his province.

According to Russian business newspaper Kommersant, once the Indonesian smelter is commissioned, Norilsk could double its yearly copper output. Currently, although the group is Russia’s largest copper producer, it ranks only ninth in the world in the production of the metal. Doubling production would place Norilsk among the world’s top five copper miners.

However, the technical feasibility study into the smelter must still be completed. Only when this is done will it be possible to determine the investment that the project will require.

Earlier, the group had reported that its copper production for the first quarter of this year had amounted to 94 000 t, down from 97 000 t during the first quarter of last year. This was the result of decreased copper production at all of Norilsk’s divisions. However, this is in line with the group’s production forecast for this year. (It also gives context for Norilsk’s plans to move into copper production in Indonesia.) The group’s total copper production in 2010 was 365 700 t.

Norilsk remains the world number one producer of nickel and palladium. Nickel production for this year’s first quarter was 71 000 t, much the same as during the first quarter of last year. There was a small increase in output at the group’s Harjavalta nickel refinery, in Finland, while production at the Russian divisions remained steady and there was a bit of a decline in the nickel output of the African division. Palladium production was 681 000 oz, slightly down on 2010’s first-quarter figures, with production levels static in Russian operations and slightly down in the African division.

Norilsk is also the number four producer of platinum and rhodium as well as the number five producer of cobalt. Increased Output Platinum production during the first three months of the year was 170 000 oz, a 5% increase over the figure for the corresponding period in 2010. This was the result of increased output at the Russian divisions and production at the international divisions remaining static.

The group’s output also includes, as by-products, gold, iridium, ruthenium, selenium, silver and tellurium. Norilsk’s main production units are its Polar and Kola divisions in Russia, but it also has operations, in Australia, Botswana, Finland and South Africa.

In South Africa, Norilsk holds 50% of Nkomati Nickel, acquired when the Russian group bought LionOre Mining International in 2007. The other 50% of Nkomati is owned by South African group African Rainbow Minerals, and the local company also manages the joint venture.

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