On September 4, 2014, Russian State Corporation Rostec and Chinese Corporation Shenhua signed a memorandum on beginning of operations for joint development of Ogodzhinsky coal field in the Amur Region and construction of Port Vera, a coal marine terminal, in the Primorsk Territory, Rostec says in its press release.
“Partnership with Shenhua corporation is a part of integrated efforts to expand Russian energy footprint in the Asia-Pacific Region. Total investments into the projects are to make some $8-10 bln. Implementation of these projects – development of Ogodzhinsky coal field and construction of Port Vera terminal as well as generation facilities – will let extend tax base of the Primorsk Territory and the Amur Region. It will also generate some 10,000 new jobs and up to 30,000 jobs in related and associated industries,” head of Rostec Sergei Chemezov said.
Comprehensive development of Ogodzhinsky coal field implies the creation of coal production and preparation facilities, development of social and transport infrastructure. High-energy coal is to be exported to the Asia-Pacific Region, primarily to China. At the next phase Rostec is going to build generating facilities and HV power lines to export energy to China.
On June 4, RT Global Resources closed a deal to enter into a project to build Port Vera, and it will act as the lead coordinator of the project.
The Port Vera coal sea transshipment terminal is planned to be constructed in the vicinity of Mys Otkrytyi, Primorsky Krai, in an ice-free area. It is designed for vessels with a displacement tonnage of 40,000-150,000 t. The cargo turn-over of the port is anticipated to be 20 mln t per year. A land plot of 826 hectares has already been set aside for the construction of the terminal.
The project has been coordinated with all state agencies. Technical specifications have been received to reinforce the railway infrastructure to support the shipment of 20 mln t of coal per year. The port facilities are in the final stage of being designed. Construction is set to begin in 2015. Total investments into construction of Port Vera are estimated at $1 bln. The terminal is to be put into operation in 2018-2019. The project will allow for ensuring the long-term supply of coal for both domestic consumers in the Far East as well as foreign partners in the Pacific Region. It will greatly expand the access of Russian coal companies to sales markets in the Asia-Pacific region.
The Gerbikano-Ogodzhinsky coal district is located in the Amur Region. Its total reserves of power-generating coal are estimated at 1.6 billion tons. The estimated investments needed to implement the project are USD 5 billion. As a result of implementing the project, by 2019 it is anticipated that 30 million tons of power-generating coal will be produced per year. This will allow for creating a modern mineral resource cluster, the statement says.
Rostec and Shenhua are to make a working group to solve technical issues and coordinate the activities of the parties including the work of design centers in China and in Russia which are to perform feasibility study for both projects.
Then negotiations will start to set up joint ventures and approve further activities under projects implementation.
ROSTEC is a Russian industrial company consisting of 663 organizations, which also includes 22 direct management companies and 13 holding companies, five of which specialise in the manufacture of civilian products, and eight, in the manufacture of products for the military and industrial sectors. Rostec organizations are located in 60 regions of the Russian Federation. Company products are delivered to markets in more than 70 countries. In 2013, the Company’s revenue totaled RUB 1.04 trillion, net profit – RUB 40 billion. ROSTEC’s allocations to all budgets exceeded RUB 138 billion.
Shenhua Group Corporation is a leading state-owned mining and energy company in China. It is the largest coal-producing company in the world. Its main business includes production and sales of coal, railway and port transportation of coal-related materials, as well as power generation and sales. Shenhua is headquartered in Beijing. The personnel of Shenhua numbers over 211,000 employees. The company's total assets make about $150 bln. In 2013, operating profit totaled $15 bln.