Mikhail Stiskin, analyst of Troika Dialogue IC

– This agreement has given start to the development of the whole republic

On June 5 2009 Deputy Director General of Rosatom State Nuclear Energy Corporation Yevgeny Yevstratov signed an investment agreement for the implementation of public-private partnership project “Development of Design Documentation for Investment Project “Complex Development of Southern Yakutia.” The project is being implemented with the government’s support and is being financed by the Investment Fund of the Russian Federation. 14 companies and federal and regional agencies (including ministries and departments) are taking part in the project. The coordinator of the project is the Government of the Republic of Sakha (Yakutia). The agreement was signed during the International Economic Forum in St.Petersburg. The objective of the project is to develop design documentation for the construction of infrastructure and industrial facilities in the Republic of Sakha (Yakutia) and the formation of a new big industrial area in the Far East of Russia. Rosatom will draft design documentation for the construction of Elkon Mining Combine, which is supposed to become the biggest uranium producer in Russia (5,000 tons of uranium a year).

Elkon Mining Combine is Russia’s biggest uranium project, the biggest greenfield project, the basis for similar projects in future.

Its success is impossible without complex development of the whole of Southern Yakutia. This agreement has given start to this process.

The concept of public-private partnership is quite appropriate here. Atomredmedzoloto or Rosatom, itself, will have to borrow money for the construction of Elkon MC. So, the use of private money is logical solution.
 
Note

This investment agreement concerns the first stage of the Complex Development of Southern Yakutia – the development of design documentation, a project worth 10.4bln RUR (7.8bln RUR to be provided by the Investment Fund of the Russian Federation, 2.6bln RUR — by investors). The Complex Development of Southern Yakutia will involve Rosatom, Gazprom, ALROSA, Rushydro and Yakutian Coals–New Technologies. The cost of the project is 422bln RUR (308bln RUR to be provided by investors, 114.5bln RUR – by the Investment Fund of the Russian Federation). The parties are planning to set up a coordinating council for supervising the project. The council will comprise representatives of all 14 parties and will control all activities under the project. The Elkon MC project is being implemented by Uranium Holding ARMZ (part of Atomenergoprom OJSC). 90.1bln RUR will be invested in the project. The full capacity of the combine is 5,000 tons of uranium a year (this level is supposed to be attained in 2024). The project will involve private investors from both Russia and abroad.