Ordering new production technology from Denmark.
Phosagro has come up with its own idea for dealing with the problems of the Pikalyovo production system. With the help of the Danish company FLSmidth, they intend to introduce new, more cost-effective production technology in Pikalyovo plants that will make commodity price wars a thing of the past.
RBC Daily has learned that as part of Vladimir Putin's visit to Denmark today, he will sign an agreement regarding a technological and design collaboration between Phosagro, St Petersburg State Mining Institute and the Danish engineering company FLSmidth about re-equipping the production facility in Pikalyovo.
The Pikalyovo complex, which previously merged into a single chain facility, has recently had trouble finding a compromise among itself about the mutual supply of raw materials and products. The plant Apatit, part of the Phosagro holding, supplies the Bazeltsement-Pikalyovo (BTP) plant with nepheline concentrate, used in the production of alumina. Along with alumina, the processing of this concentrate also produces belite sludge, which the BPT facility supplies to the Pikalyovsky Tsement cement plant, and carbonate mud, which goes to the Pikalyovskaya Soda plant for the production of soda and potash. The Apatit facility supplies raw materials also to the plant Metakhim (which, like the Pikalyovskaya Soda plant, is part of the Sevzapprom holding). These facilities, connected by technology but belonging to different companies, occasionally have disputes about commodity prices and threaten to stop production and lay off workers.
On several occasions the government, and Putin, have had to get involved. To resolve the issue, the Ministry of Industry and Trade at one point suggested that the facilities should jointly look into modernisation possibilities to boost their individual outputs. This technology modernisation project at the Pikalyovo production facilities is being carried out following the ministry's instruction and with its direct participation.
Once the agreement with FLSmidth is signed, industrial tests of dry sintering, a new, less energy-consuming technology, which later will be the basis of Pikalyovo facilities' production. The question of who will bear the principal financial burden of this modernization will be discussed later. As RBC Daily reported earlier, the ministry initially expected that the cost of a complete reconstruction of the Pikalyovo facilities would reach 300 million euros. Yesterday the ministry gave no comments.
The modernisation project should allow the Bazeltsement-Pikalyovo plant to increase its capacity from 250,000 to 300,000 metric tons of alumina per year. New technology will also reduce the cost of raw materials for other parts of the Pikalyovo production chain. The possibility of building a second alumina facility with a capacity of 500,000 tons per year is under consideration as well. Implementation of the new technology is expected within three years.
Apart from the cement facilities, Pikalyovo also houses the plant Metakhim, with which Phosagro has regular disputes concerning the supply of apatite concentrate. (Just yesterday the Leningrad Region Commercial Court postponed consideration of Metakhim's claim demanding raw materials supplies from the Apatit plant.) Maksim Volkov, head of Phosagro, complained earlier that Metakhim owners have not indicated any interest in modernisation. "Our part of the project is connected with an increase in production," said Alexander Utevsky, CEO of Sevzapprom, which manages the Pikalyovskaya Soda and Metakhim facilities. "We are ready for this. As for the rest of it, I have no comments."
Olesya Yelkova