“Rosatom” flowers in the Ural plants

The structure of Rosatom orders an assessment of the cost of two Ural plants that process non-ferrous metals – KUZOTsM and EZOTsM. Both plants were once part of the Renova holding, and now they can be useful to Rosatom in its plans to build a complete chain from mining to processing rare earth metals. The plants, among other things, produce alloys of rare earth metals from the products of the Solikamsk Magnesium Plant, which it produces from the concentrate of the Lovozero GOK – Rosatom is actively interested in both of these assets.

Atomredmetzoloto (ARZM, a structure of Rosatom) evaluates the value of the shares of Ural enterprises – the Kamensk-Uralsky non-ferrous metal processing plant (KUZOTsM) and the Yekaterinburg non-ferrous metal processing plant (EZOTsM), follows from the data of the public procurement portal. The ARZM declined to comment, and the plants did not respond to Kommersant’s request.

Both plants were previously part of Viktor Vekselberg’s Renova holding. In December 2019, as Interfax wrote, Renova sold 92% of EZOCM to Ural-Dragmet, Grigory Burenkov. KUZOCM, according to the list of affiliates as of mid-June 2021, belongs to three LLCs, the beneficiaries of two of which were people from Renova Maxim Mayorets and Vladimir Rezer.

Both plants occupy a significant share of the Russian non-ferrous metals market.

The annual report of KUZOTsM says that the plant is one of the three largest producers of non-ferrous metal products, in 2021 it accounted for 40.3% of the output of copper, brass, bronze, copper-nickel, nickel and zinc rolled products in the Russian Federation. In 2021, KUZOTsM increased its RAS net profit by 3.6 times, to RUB 630.5 million, while revenue increased by 1.4 times, to RUB 9.6 billion.

EZOCM is the oldest enterprise in the Russian precious metals industry. The plant, as stated on its website, provides a full range of refining, processing and manufacturing of products from gold, silver and platinum group metals. EZOCM net profit under RAS decreased by 30.4% to RUB 637.7 million, while revenue doubled to RUB 11 billion.

The mining division of Rosatom already has a number of non-uranium assets, including the associated mining of scandium, brown coal, projects for the development of gold deposits and the development of a large Pavlovsky lead-zinc deposit with reserves of 620 thousand tons of zinc, 131 thousand tons of lead and 9 .4 million ounces of silver. In June 2022, the CAPEX of the project was estimated at RUB 64 billion.

Also, as Kommersant wrote on May 16, Rosatom is interested in Russia’s largest producer of magnesium, rare earth metals, tantalum and niobium – the Solikamsk magnesium plant. At the same time, EZOTsM and KUZOTsM participate in the processing of rare earth metals, in particular, they produce the corresponding alloys. At the same time, the raw materials supplier for the Solikamsk plant is the Lovozersky GOK, which, according to the statements of the authorities of the Murmansk region, may also become part of Rosatom.

In addition, Rosatom, together with Norilsk Nickel, plans to take part in an auction for the Kolmozerskoye lithium deposit, one of the key elements for batteries.

In the Kaliningrad region, Rosatom is building a plant for the production of lithium-ion batteries. SBS Consulting project manager Dmitry Babansky believes that both sites fit well into the diversification strategy, not limited to the business of the state battery corporation. In his opinion, there may be synergy with KUZOTsM on batteries, but, most likely, investments will be needed. Now the plant produces rolled metal and wire, but for batteries, first of all, foil and cathode powders are needed.

Dmitry Orekhov, managing director of the NKR rating agency, says that both plants have unique technologies in the production and processing of precious metals. “The potential inclusion of them in the perimeter of ARMZ will expand the range of services provided and fits into the announced strategy of ARMZ to increase the share of revenue from non-uranium businesses to 30% by 2030,” the expert believes.

Evgeny Zainullin, Polina Smertina