Global
Russia: multinational
JV transforms gold project
The first-ever industrial public-private partnership investment project to be
undertaken by partners from all BRICS member states has been pioneered in
the gold mining sector. — Edited by Leon Louw
Sun Gold, China National Gold
Group Corporation, the Russian
Sovereign Investment Fund, Far East
and Baikal Region Development
Fund, and leading private investment
and business leaders from Brazil
and South Africa, are launching the
Kluchevskoye Gold Mining Project
in Siberia, Russia. The project is in
the Chita region of Eastern Siberia
and seeks to usher in a new model of
international cooperation.
The multinational joint venture
will see the transformation of the
Kluchevskoye gold deposit into a
significant opencast mine, with an
expected gold production of over 6.5
tonnes per annum. Pre-production
investment of more than USD500-
million is planned, with China
National Gold leading as the major
shareholder and technological partner,
following the final Russian Duma
ratification.
A historic event
The historic initiative has drawn the
interest of investors and industrialists
from across the BRICS region.
Among the South African business
people who comprise the consortium
are Dr Iqbal Surve, executive
chairman of Sekunjalo Group and
head of the BRICS Business Council;
chairman of TransAfrica Capital, Ivor
Ichikowitz; KZN Growth Coalition
co-chair, Moses Tembe; and Invest
Africa chairman, Rob Hersov.
Leading investors from Brazil include
Veronica Serra and A. de Moraes.
Dr Surve stated: “This innovative
model of public and private partners
from BRICS countries coming
together to work on projects in
BRICS countries can benefit local
and national economies and can be
[10] MINING MIRROR OCTOBER 2018
used as a model to tackle significant
projects in non-BRICS countries as
well, creating a sustainable model
for cooperation, collaboration, and
investment-led economic growth,
boosting industrial development and
providing turnkey, sustainable job
creation.”
China National Gold, one of the
world’s leading gold companies,
will provide management and
development expertise, while SUN
Group brings 60 years of experience
working in Russia, having built several
significant businesses, including SUN
Brewing, one of the region’s largest
beer companies. FEDF’s involvement
will bring regional investment and
political support for the project, and
opportunities for further growth in
the gold and copper mining sector
in the Russian Far East. The South
African and Brazilian investors seek
to add a dimension to create a joint
investment and industrial platform for
growth in Africa and Latin America.
Shiv Khemka, vice-chairman of
the Indian-owned SUN Group,
stated: “We are delighted to see our
gold project coming to fruition in
this innovative manner with the
support of the Russian and Chinese
governments. We are committed
to adhering to international
best practices in engineering,
environmental, governance, and
community standards. This ‘BRICS
Gold’ project will bring innovative
technologies, local employment, skills,
and expertise to Chita region, while
enhancing tax revenues for Russia.”
Opportunity to access
markets
All parties agree that the first and
only multilateral, private-public-
partnership project of its kind
shapes a new model of BRICS
cooperation between governments
and the private sector, bringing
together the best of finance,
technology, market access, trade and
investment to enhance the economic
growth of individual countries and
the global BRICS community. The
partners forecast this BRICS project
in Kluchevskoye to grow to become
one of the leading gold producers in
that part of the world.
Tembe commented, “For South
Af rica, to be able to access the
fast-growing markets of Asia and
Latin America in a collaborative
manner with diverse, trusted, and
experienced partners will allow
our economy to integrate into
and benefit f rom the tremendous
changes taking place on the global
stage.”
Ichikowitz stated: “This project
marks a critical step in the evolution
of BRICS. It is one of the first mega
projects to be developed under the
auspices of the BRICS collective.
It is projects like these that make
a real economic impact, not only
on economic growth, but more
importantly, by creating jobs that
impact on citizens’ lives while at
the same time bringing the BRICS
collective closer together. Political
goodwill without projects like these
has no value.
Nand Khemka, chairman of
SUN Group, commented, “This is
BRICS 2.0. It is a logical extension
of complementary strengths,
helping create more flexibility
and innovation in the structure of
transactions between members of
the BRICS community. This is a
winning formula.”b