19 February, 2022

Russia: Nornickel set a record in terms of spending on social projects

The Russian mining giant Norilsk Nickel’s spending on social projects doubled in 2021 and reached $1 billion, the company mentioned in its consolidated financial statement.

«Social spending doubled to just over USD 1 billion mostly as result of provisions related to the agreements on social and economic development of Norilsk city and the Krasnoyarsk region,” Nornickel informed in the statement.

Social spendings were planned for the reconstruction of housing and infrastructure in Norilsk.

According to the statement, total budget of city renovation planned till 2035 raised up to 120 billion rubles.

Among other major social projects, Norilsk Nickel has a program to support the indigenous peoples of the North, for that program 17 million dollars will be allocated until 2025. In addition, the company continues the construction and development of industrial, social and other infrastructural projects, which are part of the agreement between the company and the government of the Zabaykalsky Krai and 23 million dollars has been allocated for this purpose.

The agreement with the Murmansk Regional Government on socio-economic development and construction of social infrastructure facilities, as well as the agreement with the Krasnoyarsk Krai Government on investment support for a number of social and infrastructure projects until 2028 also allocated 26 and 67 million dollars respectively.

Nornickel expects that social spendings for 2022 will remain at the same level as in the previous year. However, one-off contributions to the reconstruction of Norilsk are not taken into account.

Previously, Sergei Dubovitsky, Senior Vice President of Nornickel, stated that the company planned to invest 600 billion rubles in the development of infrastructure in the north of the Krasnoyarsk region until 2030.

Early Nornickel presented plans for investment in programs for monitoring permafrost, improving air quality, modernizing production sites, follows from the speeches of the company’s top officials.

“We have started to roll-out a permafrost monitoring system in Norilsk and have committed to a major renovation of our energy infrastructure and upgrade of equipment. In addition to a better management of climate change related risks, we anticipate to get significant carbon dioxide emission cuts as the energy losses will reduce and the efficiency of our power generating equipment should improve.

On the social front, we have committed to a number of major programs, which aim to transform the city of Norilsk into a modern city with high quality living standards.

Over business cycles, our metals basket has shown its natural resilience to changes in underlying demand for commodities. Our course forward is towards integration into the new green economy. Higher focus on the global climate agenda drives up demand for our key metals and reconfirms our strategy to grow production. I believe that transformational investments will result in higher value for Nornickel and its shareholders combining industry-leading profitability and top-notch ESG standards,” Nornicвkel’s President Vladimir Potanin said.