9 april, 2012 14:30  

Prime Minister Vladimir Putin holds working meeting with head of Norilsk Nickel Vladimir Strzhalkovsky


The main topic for discussion was on how to improve the environmental situation in Norilsk. In addition, the prime minister wanted to know how a series of social issues at the enterprise were being addressed. The subject of resettling workers who wanted to move to other regions in Russia when they finished working at the company also came up.

Transcript of the beginning of the meeting:

Vladimir Putin: Mr Strzhalkovsky, we have on numerous occasions, both during my visit to Norilsk and subsequently here at a meeting in Moscow, returned to several issues that are directly and indirectly related to the activities of the Norilsk Nickel company, issues which directly affect people’s lives. You know how environmental issues get resolved in several regions of Russia where major iron and steel enterprises operate. Overall the movement is in a positive direction and fairly high profile. Your company too, you have shown me evidence, you have a programme to improve the environmental situation. I would like you to say some more on this.

And regarding social issues, the social infrastructure: kindergartens, clinics, etc., it goes without saying, should be resolved in the first instance by the region with the assistance of central government. But your company also has plans in this area, like the plan on our mutual programme to resettle people who have finished working at your company and would like – and have the right – to move to other regions in Russia.

Vladimir Strzhalkovsky: Mr Putin, 18 months ago when you visited Norilsk, you instructed me to concentrate first and foremost on working out a way of improving the environmental situation in Norilsk, since Norilsk is indeed one of the five most polluted cities in Russia.

We conducted extensive analytical work on how to go about this, how to resolve this situation. Over a year ago we announced a large-scale international tender to supply equipment and carry out this project. This work has been going on for a year. A whole range of companies have come up with proposals. We have only just summed up the results of this competition, no contract has yet been signed, the terms of the contract have been agreed, but the competition has already been held.

The tender was won by a foreign company. The difficulty for the bidders lay in the fact that the most hazardous waste substance released into the atmosphere is sulphur dioxide. All technologies currently available in the world were for one technical reason or another unsuited to the situation in Norilsk. That is why the work was so complicated, it entailed coming up with an entirely new technology, previously unknown anywhere in the world. The winner was a European consortium, made up of Italy, France, Austria and Belgium. The Italian company Techint from Milan is the chief contributor. They have had contracts in Russia before and although they have never carried out such a challenging project they have a pretty good reputation. Joining this consortium will be Russian manufacturers of equipment capable of being produced in Russia, which is being produced here.

Vladimir Putin: What is the contract worth overall?

Vladimir Strzhalkovsky: The overall value of the contract is around $2 billion. This is a purely environmental project which will not bring any financial gain but is aimed solely at improving the environment. The winners of the tender have assured us, and we have written it into the terms of the contract, that as a result of this work the air quality in Norilsk will be the same as in European cities within the space of four years.

Vladimir Putin: So the terms of the contract stipulate the work will continue for four years?

Vladimir Strzhalkovsky: Yes, four years. The programme should be completed within the space of those four years. There is a lot of new technical equipment involved. The first stage will be completed by the end of 2014, that’s roughly half of the project, maybe more and by 2016 the entire project should be completed.

Vladimir Putin: When is the work scheduled to begin?

Vladimir Strzhalkovsky: Hopefully by May (if we get the contract signed in April they should be ready to go straight away).

Vladimir Putin: Good. Now on to the other matters: the social infrastructure and resettling people.

Vladimir Strzhalkovsky: On the resettlement programme. We have a tripartite agreement between the federal government, the Krasnoyarsk Territory and the company. We regularly audit the funds, which come to about 830 million roubles a year. Last year admittedly we did not manage to meet these sums, we had to add an additional 350 million roubles because the cost of everything is going up, the size of the area is increasing, but we fulfilled all our contractual resettling obligations to people. We also have our own Our Home programme, which gives the best production workers the opportunity to buy a home entirely at the company’s expense, as they say in Norilsk, “on the mainland.”

The construction of kindergartens is ongoing. We have signed an agreement for the construction of three kindergartens; two of them will be built by us and one by the territorial government. Everything is running to schedule and by the end of the year or probably January 2013 they should be ready.

I can also report that the work on a football stadium is complete, and projects for an ice rink and a swimming pool are nearing completion.

Vladimir Putin: How do you evaluate the manufacturing and economic results for last year?

Vladimir Strzhalkovsky: The targets have been met. The financial results will be roughly the same as in 2010. The first six months of 2011 were successful, the same as for the whole global economy, but the second half of the year saw a sharp downturn, though we are still expecting a $5 billion profit margin by international accounting standards.

We are expanding our capabilities. Since ore is going down in price here, we have to process more. For that we need new processing plants and more foundries. This is all part of our investment programme. We are planning $3.2 billion of investment this year in Russia alone.

Vladimir Putin: What is the average salary right now?

Vladimir Strzhalkovsky: The average salary is 70,000. If you add in various leisure benefits then it comes to around 74,000-75,000 roubles.

Vladimir Putin: Good.