Russia''s about-turn on port development could stunt its future handling capacity, finds Alex Hughes
Vera set to benefit for climbing coal handling
China's Shenhua International Company and Rostec State Corporation subsidiary RT Global Resources signed a memorandum of understanding in June 2014 regarding the possible joint development of coal deposits in Siberia and the Far East, including the development of related industrial and logistics infrastructure.
At the heart of the agreement is the Ogodzhinskoye coal reserve, located in Russia's Amur Region, which will be jointly developed by both companies. Coal will be shipped by an upgraded rail link to Port Vera, which will be built in the Primorsky Krai administrative region.
A definitive agreement to build the port was signed by RT Global Resources, with the Rostec subsidiary to act as lead co-ordinator of the project.
According to Andrey Korobov, chief executive of RT Global Resources: “Rostec's experience shows that Chinese companies are reliable and professional partners that can be relied upon to help implement the most serious and ambitious projects. The project to construct Port Vera will help implement the development strategy for the Far East and the Russian coal industry. It will greatly expand the access of Russian coal companies to sales markets in the Asia-Pacific region.”
Total coal reserves covered by the agreement are estimated to be in the region of 1.6bn tons, with an overall investment of $5bn required to exploit them. Once mining commences, it is hoped that, by 2019, 30m tons of power-generating coal will be produced annually, with consignments targeted at both domestic customers in Russia's Far East and also international consumers in the Pacific Region, most notably China.
Port Vera, which will exclusively handle the coal exports, will be built in the vicinity of Mys Otkrytyi, in the Primorsky administrative region, and cover an area of 826ha. Construction of the port is slated to begin later this year. It is being designed to handle a range of vessels from 40,000 dwt to 150,000 dwt, loading up to 20m tons annually.
At the same time, upgrades will be made to the existing rail link to enable coal flows from the mines to be carried.
