Nornickel, the Russian mining giant, is in talks with China Copper to form a joint venture that would allow Nornickel to move its entire copper smelting base to China. This would mark Russia’s first uprooting of a domestic plant since the U.S. and Britain banned metal exchanges from accepting new aluminum, copper, and nickel produced by Russia.
The move would mean Nornickel’s copper will be produced within the country where it is most consumed – China. Nornickel had previously announced plans in April to close its Arctic facility and build a new plant in China with an unnamed partner.
Executives from China Copper, which is owned by the world’s largest aluminum producer Chinalco, flew to Moscow in June to discuss a possible joint venture. Details of the structure and investment are still under discussion, but the new facility is expected to have a capacity of 450,000 tonnes of copper annually, around 2% of global mined supplies.
Sites being considered in China include Fangchenggang and Qinzhou in the Guangxi region, as well as Qingdao in Shandong province. A decision on the joint venture is expected in the next few months, and Nornickel’s Chinese output is likely to be consumed domestically.
The relocation plan comes after the London Metal Exchange announced new restrictions on the sale of Russian-origin metals in April. Nornickel’s metals are not under U.S. or European sanctions, but many Western consumers have stopped buying Russian-origin metals since the invasion of Ukraine.