State-Private Partnership

The leaders of the country have identified transportation infrastructure development and upgrading as one of the priorities of its socioeconomic development. A dependable transportation network for delivery of products to end users is a sine qua non condition of implementation of mining projects in new areas of economic growth, which are situated in Eastern Siberia and Far East.

Elegest Coal Deposit development is indissolubly linked with OPK Mining’s biggest infrastructure project – construction of the Kyzyl-Kuragino Railroad, which is to go through the Republic of Tyva and the south of the Krasnoyarsk Territory.

The project is of interest not only because of its scale and engineering tasks to be solved during railroad construction, but also because of the tremendous influence that it will have on the development of all of the industrial complex and economy of the Republic of Tyva.

On March 22, 2007, the Governmental Commission on Investment Projects of State Importance approved state support of the Kyzyl-Kuragino Railroad construction project with the financial resources of the RF Investment Fund, in the amount of 50% of the railroad construction cost. As of now, the federal executive authorities concerned have finished elaborating a draft of the RF Government’s Decree on project passport approval and the respective document package is being prepared for submission to the RF Government.

It is the today’s biggest example of the state’s financial participation in a project implemented by a private company. The amount of the state’s investments will be RUR 51.7 bn.

Considering that the project will be very expensive, OPK Mining plans to use advanced experience in designing and construction of projects under complex mountain and climatic conditions, which will make it possible to minimize the capital expenditures of the investor and federal budget on the project.