AGENCY FOR INVESTMENT PROMOTION AND EXPORT SUPPORT OF SAKHA REPUBLIC (YAKUTIA) CATALOGUE OF INVESTMENT PROJECTS OF SAKHA REPUBLIC (YAKUTIA) Dear friends! Yakutia has unique investment opportunities. This is due to the presence of the richest reserves of natural resources, a stable social and demographic situation, a high level of human capital and strong economic positions in the Far East Federal District. Yakutia is actively developing interregional, international and foreign economic relations. Stimulation of investment activity and formation of a comfortable investment climate will be unconditional priorities of the economic policy of the republic. In Yakutia, the necessary investment infrastructure has been created and is ready to provide comfortable conditions for doing business. We are open for productive cooperation and are sincerely glad to see you among our business partners! Yours faithfully, Head of the Sakha Republic (Yakutia) Aisen NIKOLAEV 3 Dear Ladies and Gentlemen! Our professional team will provide you a full range of services from plan development to project implementation based on Onestop-shop principle. The catalogue will introduce you to first priority investment projects of Sakha Republic (Yakutia). Looking forward to assisting you with discovering your investment opportunities in Yakutia! Yours faithfully, Director General Agency for Investment Promotion and Export Support of Sakha Republic (Yakutia) Alexander KONDRASHIN AGENCY FOR INVESTMENT PROMOTION AND EXPORT SUPPORT OF SAKHA REPUBLIC (YAKUTIA) 36/1 Ordzhonikidze St., office 503, Yakutsk, 677000 Sakha Republic (Yakutia) Information and Consulting Department: +7 (4112) 39-83-00 (extension 67 905) +7 (4112) 40-20-42 Investment Project Promotion Department +7 (4112) 39-83-00 (extension 67 903) e-mail: [email protected] www.investyakutia.com 4 5 MEASURES OF STATE SUPPORT Tax preferences: Profi t tax – 0% for 5 years Wealth tax – 0% for 5 years Land tax - 0% for 5 years Reduced contributions to extra-budgetary funds of the Russian Federation – for 10 years Territories of Provision of land plot advanced social Preferential connection to the infrastructure and economic Simplifi ed visa regime for foreign citizens development Permission for foreign labor without quotas (SEZ) Issuance of building permits within 40 days Free customs zone regime Unscheduled inspections only after approval of the Ministry of Regional Development of the Russian Federation Tax preferences: Profi t tax - 0% to the federal budget, no more Regional than 10% to the regional budget for the fi rst 5 investment years and no less than 10% for the next 5 years projects Reduced rate on mineral extraction tax Available for citizens of 18 countries Quick receipt: average time - 20 minutes online Electronic visa for Issued for free visiting the Far East Valid for 30 days, allowed to stay in the region for 8 days 6 CONTENTS TRANSPORT AND LOGISTICS 9 MINING AND DIAMOND-CUTTING INDUSTRY 15 AGRIBUSINESS 21 TOURISM 25 HOUSING AND UTILITIES SECTOR 29 OIL AND GAS INDUSTRY 35 IT 47 CONSTRUCTION MATERIALS 49 TIMBER INDUSTRY 55 7 TRANSPORT AND LOGISTICS 9 UPGRADING AND DEVELOPMENT OF RUSSIAN CAPACITIES TO CREATE MODERN RIVER FLEET FOR INLANDN WATERWAYS Initiator: Zhatai Shipyard JSC Total cost USD 87.9 M* Investment required USD 13.7 M Payback period 9,3 years NPV USD 28.5 M IRR 12,79% Discount rate - Project resume Construction of high-tech Zhatai Shipyard on the basis of the existing shipyard Project’s signifi cance Replenishing the reserve of the carrying capacity of the Lena basin fl eet by constructing modern vessels. Systemically important project of North Yakutia stronghold area Project parameters Annual productive capacity: constructing up to 10 river vessels with ship-breaking plant. Creating over 700 jobs Project stages Engineering company is State Program for the Approval of the Obtaining the ASEZ established; business plan and Development of the Arctic is Russian State resident status; Commissioning; fi nancial model are elaborated endorsed; Designing the object Expertise Construction of the object Lead ship laying 2016 2017 2018 2019-2021 2021 Investor’s involvement level Engineering company’s equity holding Debt fi nancing * in current prices without technical connection to the grid 10 RECONSTRUCTION (RENOVATION) OF YAKUTSK AIRPORT’S INTERNATIONAL TERMINAL Initiator: Yakutsk Airport JSC Total cost USD 21.7 M Investments required USD 20.8 M Payback period 13.7 years NPV USD 1.5 M IRR 6.2 % Discount rate 5.8 % Project resume Creating a modern international terminal of Yakutsk Airport, equipped with high-tech engineering infrastructure, ensuring the airport’s passengers’ and guests’ security and top- class comfort Project’s signifi cance Extension of the airport’s international transport network Creation conditions for the inbound tourism development in Russia Improvement in passenger service and security to international standards Project parameters Total cost of the project RUB 1 363.5 mln, including: USD 9.3 M – construction and installation USD 3.9 M – equipment for quality and safe passenger service USD 7.3 M – equipment for aircraft and airfi eld service USD 0.3 M – equipment for customs control systems Project stages construction and installation, Purchase and Purchase and Project purchase and installation installation of aircraft installation of Finding preparation, of passenger service and airfi eld service equipment for customs investors design estimates equipment equipment control systems 2019 2019-2020 2020-2022 2021-2022 2022 Investor’s involvement level Lending a credit Involvement in the project on the principles of public-private partnership 11 CREATION OF A PROVING GROUND FOR AUTOMOBILE TIRES WITH UNIQUE CHARACTERISTICS Initiator: NEFU Proving Ground LLC, M.K. Ammosov North-Eastern Federal University, Yakutsk City Administration Total cost USD 18 M Investments required USD 16.8 M Payback period 13 years NPV USD 10.9 M IRR 17.2% Discount rate 9.3% Project resume Construction of a testing center for climatic tests of tires, machinery, equipment and materials in Yakutsk. The advantages of the new test site are the Arctic climate and the presence of permafrost Project’s signifi cance The project will allow customers-producers to gain access to the facility, which has unique characteristics, such as: a wide temperature range, the quality of natural snow, the presence of permafrost Project parameters - Since 2012, seasonal tests of automobile tires by the corporation Bridgestone are carried out on the basis of the existing autodrome - A Memorandum of Intent and Further Development of Cooperation with Bridgestone corporation was signed - Status of a resident of SEZ Industrial park Kangalassy was received Project stages Organization and Phase 1 Phase 2 Construction of year- preparation construction construction round indoor track 2018 2018 2019 2022 Investor’s involvement level Project fi nancing 12 MINING AND DIAMOND- CUTTING INDUSTRY 13 CREATING A JEWELRY AND DIAMOND-CUTTING CLUSTER IN KANGALASSY INDUSTRIAL PARK ASEZ (STAGES 1 AND 2) Initiator: SAYBM LLC (subsidiary of JSCB ALMAZERGIENBANK JSC) Total cost USD 27.8 M Investments required USD 25.1 M Payback period 6 years NPV USD 7.5 M IRR 32,4% Discount rate 25% Project resume The project aims to create integrated infrastructure for enterprises in jewelry and diamond- cutting industry and ensure favorable conditions for small and medium business Target market: the USA, Israel, Japan, Singapore, Hong Kong, Macao, Moscow and other Russian cities Project’s signifi cance Creation of the jewelry and diamond-cutting cluster in the Sakha Republic (Yakutia) will allow to consolidate natural and human resources (talent, expertise, images) and lead to a new prominent development stage of jewelry and diamond cutting industry Project parameters The production capacity is 600 kg of jewelry worth USD 94.8 M and 84 thousand carat of diamonds worth RUB USD 373.6 M by 2021 Land plot is available in in Kangalassy Industrial Park ASEZ Project stages Finding investors for Finding investors for stage 1 Design estimates stage 2 Construction Commissioning 2017 2017 2017-2021 2017-2018 2019 Investor’s involvement level Attract strategic investor Project fi nancing in the authorized capital with / without the right of participation 14 DEVELOPMENT OF RUCHEY TIREKHTYAKH ALLUVIAL TIN DEPOSIT IN THE SAKHA REPUBLIC (YAKUTIA) Initiator: Yanolovo JSC Total cost USD 51.4 M Investments required USD 51.4 M Payback period 9 years NPV USD 8.6 M IRR 19.9% Discount rate 14.8% Project resume The project of Yanolovo JSC aims at separate surface mining at Ruchey Tirekhtyakh alluvial tin deposit in Ust-Yana District of the Sakha Republic (Yakutia) Project’s signifi cance Growth in tin mining and tin concentrate production in Russian and Sakha Republic (Yakutia) for the industrial development of the Russian Federation; Increased industrial production capacity of the republic; Creating new jobs in Ust-Yana District and creating conditions for further professional development; The project will create additional export capacity of the Sakha Republic (Yakutia) Project parameters 2020-2032 Annual tin output: 2,400 tons Tin sale price: 19,000 USD/ton Sales revenue: USD 46.2 M Project stages Yanolovo JSC obtains a Up-to-date deposit’s Conditions feasibility study Approval of conditions The deposit’s license and starts works to surface plan is set. is completed and submitted feasibility study. Elaboration development is planned resume tin mining. Exploration Conditions