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Feature Eurochem Widens Its Sights VOLGAKALIY PROJECT feature EuroChem widens its sights Fertilizer Focus discusses EuroChem’s potash capacity with Clark Bailey, Head of Mining, and future plans with Olivier Harvey, Head of Investor Relations Fertilizer Focus (FF): I understand in Brazil - the start of its potash (from source to solution) and as such, EuroChem are looking to offer N, P operations will add another dimension also enjoys many key partnerships and K nutrients to the market, which to its international presence, and and market relationships, which would make you a one-stop shop undoubtedly increase the Group’s remain valuable for our continuing for all fertilizers. How do you plan focus on the Asian, South American market penetration. This applies for to market these products and are and African markets. Needless to say all nutrients and will be particularly you looking at any joint marketing that with its global reach, the Group’s important in growth markets like Asia opportunities? premium products and distribution and Latin America, where we see business (EuroChem Agro), offers a EuroChem (EC): EuroChem is known the need for more balanced nutrient natural platform to leverage potash to be an ambitious company, whether sales. application. by its intensive value creating projects in Russia or growing M&A track- Still, due to internal potash In essence, with so many opportunities record. While today the Group has a requirements the Group’s potash available, it is probably still early solid presence in Europe, the CIS and market entry is expected to be rather to imagine what shape or form the the US - and recently announced the gradual, which also means flexible. Group’s K marketing function will acquisition of a fertilizer distributor EuroChem is an integrated company ultimately take. Volgakaliy potash - mine rescue building 1 Fertilizer FOCUS | SEPTEMBER/OCTOBER 2016 feature VOLGAKALIY PROJECT VolgaKaliy potash project - electrical substation and three shafts FF: Which markets are you looking at The VolgaKaliy project is targeting? EC: EuroChem’s potash ‘market’ will focused on producing by the initially be internal for application at middle of 2018 our NPK facilities. Already today the Group sources up to 500 000 tonnes of potash from the market. These volumes will be fulfilled by our mines with our internal potash requirements measuring standards (B+C1+C2) bearing levels and protective freeze potentially increasing above 1 million and the anticipated life of the mine walls. Today, those plans are being tonnes per year as we grow our NPK/ is c.45 years. It is an excellent deposit implemented, but the effect of the complex production capacity. with KCl percentage of 39.8%. The cage shaft will create an additional six project was originally planned to begin month delay to the plans put together As we mentioned, a key focus for operating back in 2014, however, in in 2013 following the first sinking our potash product will be Asia late 2011 issues developed with the issues. Currently, first production is Pacific and Latin America, which are technique chosen to sink one of the scheduled for mid-2018 and a 5-year growth markets and where potash site’s three shafts. As a result, the entire ramp up period is envisaged to get will be needed to provide balanced cage shaft sinking effort was put on us to full capacity, during which time nutrition and maximized agricultural hold – and so was the construction other surface facilities will be built. productivity. of the main mill on the surface - but With this modified plan, it puts the We also plan to convert KCl to SOP for to our good fortune today, other production back on our original track specialty agriculture sales for those infrastructure continued, although within this time frame. crops which are sensitive to chlorides at a slower pace while awaiting the such as fruits and tobacco. outcome of the cage shaft sinking issues. In 2013 the sinking of the FF: What are the specific timescales cage shaft was resumed and in 2014 you are working to? FF: Argus FMB recently visited the sinking began on the third shaft, EC: The VolgaKaliy project is focused new VolgaKaliy mine in Russia. the site’s second skip shaft. In 2013, on producing the first product by the Could you give me some background surface construction was restarted middle of 2018. In 2018, with mine on this project? (and the status is as noted below). development being the throttle, EC: The VolgaKaliy project was With the recent issues in the cage approximately 280K tonnes of MOP, conceived when EuroChem shaft (see below), yet another plan red standard, will be produced during purchased a license area, named was organized to change the services the first six months. EuroChem’s Gremyachinskoe, for the development of the two shafts which have now other potash project, Usolskiy Potash, of potash in 2005. The site’s reserves reached depths well into the salt and will come online shortly before the are 1.613 million tonnes by Russian are far past the bottom of the water VolgaKaliy site. We currently expect to Fertilizer FOCUS | SEPTEMBER/OCTOBER 2016 2 VOLGAKALIY PROJECT feature Volgakaliy potash - product storage start mining operations at Usolskiy in EuroChem is long-term focused the fourth quarter of 2017. and enjoys advantageous cost FF: To which depths will you be positions across nutrients mining? EC: Mining depths vary slightly, but the ore, being an ‘evaporate’ and without electrical substation, the rail system 2.3 million tonnes per year of MOP geological uplifts or major faults, is and rail station including the loading produced in two grades, both of relatively flat. The bottom of our two systems for the entire plant, the gas which are identified as being a ‘Red skip shafts will be at -1147 metres below pipeline and metering systems, the Product’ 95% KCl grade, one of which the shaft collar or ‘Zero’ reference water wells inlet and water treating is referenced as ‘Standard Grade –Pale elevation point. The top of the upper facilities, the tailings management area Pink’ and the other as ‘Compacted’ salt zone happens to be at an elevation and ponds, roads, fences, parking lots, or ‘Granular-Pale Pink’. The ‘pale of roughly -1004 metres (varies slightly). canteen and administration buildings, pink’ designation comes from the The shaft stations for loading the skips mine rescue building plus the site’s fact that the raw ore material in this will be at the elevations -1072 metres. fire protection facilities. It also involves potash zone has fewer elements and The main ore body of the potash zone sinking all three mine shafts, building minerals in the 5% which is not KCl lays generally between -1085 metres all three headframes, shaft service and that give the MOP its ‘red color’ and and -1100 metres. hoist buildings, as well as building the consequently it will be pale in color. offices and shops for maintenance. The next capacities are a little more The distinction between Phase 1 and complicated to describe, call them 2a FF: The mine is being developed in 2 is basically, that each phase has its and 2b or Phase 2 and 3, but will be two phases – could you explain these own surface beneficiation plant which built following completion of Phase phases? includes crushing, screening, floatation, 1 and its startup and commissioning. We will be able to construct both a EC: Yes, the project has been proposed compaction, drying and a separate Red Plant of approximately 1.3 million to be developed in two phases. The storage building. For the underground, the near shaft services facilities, shops, tonnes per year and a small white project’s first phase which we name storage areas and bins will all be done plant of 1.25 million tonnes per year. as Phase 1, is defined simply by the during the Phase 1 work while both This affords us a wider range of client work and facilities that are required to phases have mine development and or markets, some of which are for our bring this stage of development into ramp up work to enable the surface own internal use and expansions into the initial operations. This involves facilities to reach their nameplates. higher-grade fertilizers. almost the entire surface facilities and infrastructure for the plant, less the Phase 2 Beneficiation Plant and some FF: Could you confirm that the FF: One of the shafts flooded recently additional storage facilities. So, this capacity of the mine is 4.6-4.85 – how did this happen and what is Phase 1 includes removing and storage million tonnes of MOP once both the current status? of the top soil from the site, leveling phases are completed? the site to the engineered elevations EC: The shaft did not flood. There and grades, building the high voltage EC: Phase 1 will be a plant whose was a water inflow that prevented (220 Kv) power lines and the main operational capacity is essentially us from continuing to sink. The 3 Fertilizer FOCUS | SEPTEMBER/OCTOBER 2016 feature VOLGAKALIY PROJECT amount was managed simply by use system for this mine. The design takes mill with Renaissance, the contractor. of our buckets and we initiated a into consideration several cases and Additional focus on installation of grouting program which was partially its construction will progress over steel and equipment continues. successful. However, after extensive time, meaning the location and size of Renaissance started the installation grouting efforts at the shaft bottom, dewatering gets revised as the shaft/ of process equipment for the grinding it was finally understood the actual mine development progresses. The main and flotation departments, the first path and profiles of the water flow.
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