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. Last Updated: 07/27/2016

Uralkali Revives Plan to Build New Mine, Wins 2-Year Delay

Uralkali said Monday that it has rekindled plans to build a major new mine after winning a two-year extension to a deadline for developing its portion of the largest potash deposit outside Canada.
Uralkali said it had until May 15, 2011, to prepare its design plan for a mine at the Ust-Yaivinsky field, which should then be brought into production by Aug. 15, 2018. The extension was granted by the Federal Subsoil Resources Use Agency.
The mine’s capacity will be lower than previously envisioned but allows Uralkali, which accounts for one-third of global potash exports through its Belarus-based export agent, to revisit a plan seemingly abandoned last year on environmental grounds.
“Our negotiations with the representatives of the state authorities were thorough. We have succeeded in reaching an agreement suitable to both parties involved: the subsoil user and the government,” Uralkali CEO Vladislav Baumgertner said.
Uralkali said in December that it would link the Ust-Yaivinsky field to its existing Mine 2, thus abandoning a $3 billion plan to build the separate Mine 5, because of the financial crisis and new legislation on the use of forested land.
This revised plan was rejected, Uralkali said, but amendments to the forestry law approved in March allowed the company to obtain land in the so-called green zone.
The Ust-Yaivinsky field in the Ural Mountains is part of the larger Verkhnekamskoye potash deposit, the largest outside the Canadian province of Saskatchewan. Potash is a soil nutrient used in fertilizers.
Uralkali fell 1.9 percent on the MICEX after rival Silvinit agreed to ship 850,000 tons of potash to India for $460 per ton. The estimated average price for the soil nutrient through 2013 was cut 25 percent to $450 per ton at UBS on Monday.