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On the threshold of the tin Renaissance?

Leonid Khazanov on the perspectives of development of tin mining in the Far East

On the threshold of the tin Renaissance?
The reserves of tin in the bowels of Russia exceed 2 million tons and they are concentrated outside the Urals - within the Irkutsk and Magadan Regions, the Transbaikal, Khabarovsk and Primorye Territories, the Republic of Yakutia and the Chukotka Autonomous District (except for the Republic of Karelia, but the tin reserves are insignificant here). This asymmetry is explained by the peculiarities of the formation of tin deposits, as a result of which they are localized in six metallogenic provinces - the Baikal, Zabaikalsk, Yano-Indigir, Hingano-Okhotsk, Sikhote-Alin and Chukotka provinces.
The largest of these is the Yano-Indigir province: it contains over 30% of tin reserves from their total volume in our country. Its key asset is the Deputy Depent field, which accounts for 75% of the total reserves of the Yano-Indigir province, the remaining 25% are deposited in placers .
It is followed by the Khingano-Okhotsk and Sikhote-Alin provinces: each of them contains approximately 20% of tin reserves in Russia. The main deposit of the Khingano-Okhotsk province is the Pravoormskoye, for the Sikhote-Alinskaya - Tigris.

The Baikal, Trans-Baikal and Chukotka provinces occupy a subordinate position. In the Transbaikalian province, it is worth noting the unique Sherlogorsk deposit, in Chukotka - the Pirkakai ore cluster.

It should be noted that, until the 19th century, tin raw materials were not mined in Russia, so the metal was imported from abroad - Bohemia, Germany, Great Britain. The situation changed a little in 1811, when the Ononskoe deposit was discovered in Transbaikalia (although it was discovered at the site of ancient mining). A little later, the Pitkyaranta deposit was discovered in Karelia. However, mining in Transbaikalia and Karelia could not cover all Russia's tin needs, and it was still imported.

Only in the 1930-ies. in the USSR, large-scale prospecting works are being carried out on tin, which led to the discovery of deposits in Primorye, Yakutia and Kolyma. Since they were in hard-to-reach areas, their development was carried out by the Central Administration for the Construction of the Far East of the USSR NKVD (the notorious Dalstroi). In fact, stripping and mining operations were carried out by prisoners without any means of mechanization.

During the Great Patriotic War and after it, the development of tin deposits intensified. A number of large GOKs were established - Khingansky, Khrustalny, Deputatsky, Solnechny, Pevek, etc. and several dozens of mines that allowed the Soviet Union to become one of the leaders in the world tin market. But the monopoly consumer of their products was the only enterprise in the USSR producing refined tin - the Novosibirsk Tin Plant (NOC).

Despite the intensive development of the tin industry in our country, its Achilles' heel was the mineral and raw materials base. Undoubtedly, many deposits and manifestations were discovered by the efforts of Soviet geologists, while the content of tin in them was significantly lower than in foreign ones. In addition, ores often belonged to the category of difficult-to-digest and required long and costly technological chains for their processing, the deposits themselves were distinguished by complex mining and geological conditions.

The collapse of the Soviet Union in 1991 led to disastrous consequences: economic ties that had developed over the decades began to collapse, domestic prices for energy resources rose sharply. In addition, there was a global economic crisis that caused a decline in demand and a decline in world prices for tin. All of this, combined with the remoteness of mining and quarrying plants and mines from the NOC, poor logistics infrastructure and irrational transportation schemes, high interest rates on loans from commercial banks, low concentrations of metal in the ores made the mining enterprises unprofitable. As a result, in 1990-s. they had to work out only rich deposits, leaving poor ores in the depths.

Nevertheless, selective working out could not solve the problems, and the process of stopping production at mining and enrichment plants and mines went at a rapid pace. In a relatively short period of time, 15 years, Pevek, Iultinsky, Khingansky, Sherlovogorsky, Khrustalnensky, Dukat GOKs ceased functioning. The Solar GOK and Pravormiysky mine lasted the longest, but they finally got up. At the same time, there was a process of reducing output on NOK.

However, the demand for tin in the domestic market has not disappeared. Of metallurgical enterprises, Magnitogorsk Iron and Steel Works, which produces tinplate, is a major consumer of tin. In addition, tin is in demand in the production of sheet float glass, which makes mirrors, double-glazed windows, etc. (it has an excellent smoothness in combination with the absence of optical defects). Therefore, the decline in the output of tin in Russia was offset by its increased imports.

Movements towards the recovery of the tin industry began in 2011, when an amendment was adopted to the Tax Code of Russia, nullifying the rate of the mineral extraction tax (NDPI) for conditioning tin ores in the Far Eastern Federal District for the period from 1 January 2013 on 31 December 2017 in

In 2012, the investment group Russian Funds created the Rusolovo company (now incorporated in the Seligdar holding, controlled by the Russian Funds), intended for the exploitation of tin ore deposits in the Khabarovsk Territory - Pravourmiyskoye, Festivalny and Perevalny. In 2015, it completed the renovation of the concentration plant at the Pravourmiyskoye field, in 2016, after the restoration, it launched the Solnechnaya concentrator. Plus Rusolovo modernized the transport scheme of the Molodezhny mine at the Festivalnoye deposit. As a result, the production of tin in concentrate increased - in 2016 Rusolovo produced 627 tonnes, the plan for 2017 - 1 thousand tonnes, for 2018 - 1,5 thousand tonnes. Some of the products are sold in Russia, and some - to international commodity traders NobleGroup, Traxys, Trafigura.

In August 2016, the state corporation Rostec showed interest in tin. Her attention was attracted by the Tirekhtyakh Ruchey placer deposit (the license belongs to the Yanolovo firm) with reserves of about 70 thousand tons of tin. Meanwhile, the development of the Tirekhtyakh Brook will clearly not be easy, as it might seem at first glance. The field is located in a rather remote area of ​​Yakutia, plus it will be necessary to equip from scratch all the necessary production and auxiliary infrastructure, for which it will be necessary to deliver building materials and energy resources either by road or by helicopters (in both cases it will not be cheap). In principle, it would be possible to consider the possibility of using the capacities of the Deputatsky GOK, but it is located about 60 km from the Tirekhtyakh Stream, and besides, there is no exact information in what condition its equipment, if any, is available.

To create the same production of pure metal in this region of Yakutia in the current conditions is economically unprofitable, since it can be very costly. Nevertheless, tin concentrate from Tirekhtyakh Creek may be in demand both in the Russian market and outside it: it can be sent to the Novosibirsk processing plant (NOZ, formed on the basis of the NOC), or to consumers in China who purchase concentrates hardly not in all tin-mining countries. In addition, since January of this year, tin is becoming more expensive and at present the price of LME is higher than $ 20 thousand for 1 ton.

The investment company Millhouse Capital, on the contrary, has abandoned the project to develop the Pyrkakai hub in Chukotka, which has reserves of 228,5 thousand tons of tin. Opened in 1937, it still remains undeveloped. The reason lies in its inaccessibility and low concentrations of tin, although the ores of the Pyrkakay cluster are easily processed. Millhouse failed to attract the Chinese Yunnan Tin Group, which is considered the largest tin producer on the planet, as a partner.

In the future, however, it is possible to forecast the development of extraction of tin raw materials in Russia. True, it seems, while his only "getter" will be "Rusolovo", while the producer of refined tin is NOZ. "Rusolovo" expects to build a full-fledged GOK at the Pravourmiyskoye field and if the zero rate of the mineral extraction tax is extended, this will be a good help for this project.
Accordingly, the future of any projects involving the exploitation of tin deposits in the Far East will depend on a set of factors, starting with the dynamics of prices for LME, tax and other benefits in the regions, and pumping the level of demand for metal in Russia and beyond. And if they are positive, then the tin Renaissance is inevitable.
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