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Udokan Copper Project, Zabaikalye

  • Producer of

    Gold

  • Mine Type

    Open-pit

  • Location

    Zabaikalye, Russia

  • Estimated Investment

    $2.9bn

  • Construction Started

    September 2018

  • Start of Production

    2022

  • Developer

    Baikal Mining Company

Udokan copper project is an integrated mining and metallurgical project (MMP) located in Zabaikalye region of Kalar District in Russia. Baikal Mining Company, part of USM Holding, is the project developer.

The open-pit project holds copper resources of 26.7 million tonnes (Mt). It is the biggest copper deposit in Russia and the third biggest in the world. The project is expected to create more than 2,000 direct and indirect jobs.

Feasibility study of the $2.9bn copper project was completed in March 2014 and was approved by the Federal Agency for Subsoil Use in September 2015. Environmental approval for the three-stage Udokan MMP was granted in October 2018, while the first stage construction works began in September 2018.

Udokan copper project geology and mineralisation

The Udokan copper project in the north of Zabaikalye hosts stratiform copper mineralisation within metamorphosed sedimentary rocks.

Copper mineralisation is majorly contained in quartz-carbonate sandstone of Lower-Proterozoic Upper Subsuite of the Sakukan Formation. Most of the mineralisation forms as a continuous stratiform horizon representing a synclinal fold with host rocks.

The project hosts oxide and sulphide mineralisation, which is alternated in the ore mass. Higher concentrations of oxide ores are identified near the surface in addition to fissures and faults.

Udokan copper project reserves

The Udokan project is estimated to contain proven and probable ore reserves of 1,439.5Mt of ore, grading 1.05% Cu and 10.8g/t Ag. It is estimated to contain 15.1Mt of copper and 497.7 million ounces (Moz) of silver.

Mining and processing of ore at Udokan copper project

Conventional open-pit methods of mining, involving excavators and dump trucks, will be applied at the Udokan copper deposit, which is proposed to be mined in three phases.

The first phase will be carried out between 2021 and 2033 and focus on achieving a production capacity of 12Mtpa. It is expected to produce 130,000t of copper, half of which will be cathode copper and the rest copper concentrate.

The second phase will involve the expansion and maintenance of ore capacity up to 48Mtpa between 2033 and 2050. The final phase, which will run from 2050 to 2090, will include the cleaning-up of reserves by using combined method.

Ore will be processed at a 36Mtpa processing plant, which will be expandable up to 45Mtpa. The plant will include crushing and grinding circuits, concentrator, hydrometallurgical plant, tailings, and reclaim water facilities. It will also feature a conveyor for transportation of the crushed ore.

The Udokan ore will undergo beneficiation and hydrometallurgical processes to produce separate cathode copper and sulphide concentrate.

Financing and agreements entered for the Udokan copper project

Russian state banks VEB.RF, Gazprombank, and Sberbank agreed to provide financing to BMC for the first stage development of the Udokan project in February 2019.

BMC has also signed agreements with Industrial and Commercial Bank of China (ICBC), Bank for Development and Foreign Economic Affairs, VEB Engineering, and HOPU Investments for financing the copper project.

Infrastructure facilities at Udokan

Power supply during the construction phase of the project will be provided from the existing 220kV Chara substation. FSK UES (Federal Grid Company) will supply the power required for the operation stage through a 220kV transmission line.

The project is located in proximity to the Novaya Chara railway station, which is being upgraded by the Russian Railways to accommodate the Udokan cargo handling. The Chineyskaya line will connect the deposit with the Baikal-Amur Mainline.

Contractors involved

Fluor, SRK Consulting, and Knight Piesold prepared the feasibility study (FS) of the project in association with Russian institutes and organisations. SRK Consulting (Russia) estimated the ore reserves, as part of the FS.

TOMS Engineering was engaged as the general designer of the project and will be responsible for designing the engineering surveys and infrastructure facilities.

NTC-Geotechnology was awarded the contract for designing the mining complex, while Mekhanobr Engineering is responsible for designing the processing plant.

Shaneco Group prepared the comprehensive environment impact assessment, while Novosibirskstroy Complex-Project was contracted for designing the power supply facilities.

State Design Survey and Scientific Research Institute of Civil Aviation Aeroproject was engaged for the front-end engineering design documentation and feasibility study of the Chara airport complex upgradation project, while Novaya Aviatsia is responsible for designing the airport complex.

PMK Sibiri, ESK Energomost, Dalstroymekhanizatsia, Vostsibtransproject, FGC UES, and St. Petersburg Mining Project and Engineering are some of the other contractors involved in the project.

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