Uralkali

Uralkali is a Russian potash fertilizer producer and exporter(URKA on the Moscow Exchange). The company’s assets consist of 5 mines and 7 ore-treatment mills situated in the towns of Berezniki and Solikamsk (Perm Krai, Russian Federation). Uralkali employs about 12,000 people (in the main production unit).

The company produces standard and granular potassium chloride (KCl), sodium chloride (NaCl in the form of halite), and carnalite. It supplies products (through its own trader Uralkali Trading) to over 60 countries, with the major markets including Brazil, India, China, Southeast Asia, Russia, USA, and Europe. In 2018 Uralkali produced 11.5 million tonnes of potash (KCl).

Uralkali develops Verkhnekamskoye field of potassium and magnesium salts, world's second largest in terms of potash ore reserves. The company’s total ore reserves total approximately 8.2 billion tonnes. Uralkali holds the development licences for the Ust-Yayvinsky and Polovodovsky blocks at the Verkhnekamskoye field, which contain ore reserves of 1.291 and 3.074 billion tonnes respectively. Uralkali also holds the development licence for the Romanovsky Block of the Verkhnekamskoye deposit with the estimated reserves of 385 million tonnes of sylvinite ore.

History

1934 - Start of construction.

1942 - The Berezniki Potash Mining Complex started to produce pure white and technically modified salts.

During the World War II, the USSR urgently needed carnallite to produce the magnesium required by the aviation industry. The carnallite ore reserves found in the Verkhnekamskoe potash-magnesium salt deposit enabled carnallite production.

1944 - Start of carnallite production.

1954 - Launch of the first mine group with the annual capacity of 266,000 tonnes.

1962 - The carnallite plant’s first production line, with an annual capacity of 180 tonnes, was put into operation.

1964 - The Soviet National Economy Council agreed to establish the Uralkali industrial association in Berezniki, combining the First and Second Potash Mining Complexes located in Solikamsk and Berezniki respectively. These facilities formed the First Potash Mining Complex.

The construction of the Second Potash Mining Complex in Berezniki, with an annual capacity of 3.5 million tonnes, was started. This is now Berezniki-2.

1968 – Start of construction of the second mine group.

1970 - Launch of the second mine group.

1974 - Launch of the third mine group.

1987 - Launch of the fourth mine group.

1992 - The Berezniki-4 chemical enrichment plant produced its first 98% potassium chloride. Uralkali became a joint stock company. The Silvinit Production Association was renamed as OJSC Silvinit.

2001 – Construction completion of the Baltic Bulk Terminal.

2004 - Uralkali obtained a license to develop the Ust-Yaivinsky block of the Verkhnekamskoe deposit.

2006 - Shutdown of the first mine group.

2007 - In October 2007, Uralkali listed its shares on the London Stock Exchange. Uralkali’s order book was 23 times oversubscribed.

2011 - Merger of OJSC Uralkali and OJSC Silvinit.

2014 - Uralkali obtained a licence to develop the Romanovsky block of the Verkhnekamskoye deposit with reserves of 385 million tonnes of sylvinite, according to the Company’s estimates.

2015 - Delisting of Uralkali GDRs from the London Stock Exchange.

2016 - Uralkali secured a US$1.2 billion syndicated loan, the largest in its history.

2017 - Uralkali successfully closed the book for a debut local exchange bond (series PBO-03-P) under its exchange bond programme.

2019 - Uralkali signs its first dual-currency pre-export facility.

2020 - Uralkali has achieved a strong debut score in the SAM Corporate Sustainability Assessment ESG-rating conducted by one of the most reputable rating agencies S&P Global.

Consumers (export)

Uralkali’s sales geography comprises over 70 countries. The major markets are Brazil, India, China, Southeast Asia, Russia, USA, and Europe. Uralkali’s export sales are undertaken by Uralkali Trading SIA. The Company works on long-term and spot contracts basis. Uralkali delivers its products by rail and sea. Current prices for different regions are available on request from the Sales Department.

The geographical location of the company's sales markets allows it to sell its products all year round. Below is the distribution of sales by geographic location of consumers.

The main direction of Uralkali's deliveries is the markets of the BRIC countries (Brazil, Russia, India, China). These countries are characterized by high population and income growth rates, which are also key drivers of potash demand growth. Uralkali, through BPC, has a leading position in the markets of these countries, and therefore has higher growth potential compared to producers with a smaller presence in the markets of the BRIC countries.

Deliveries to the domestic market

The price for Russian producers is almost 30% lower than the net selling price of potash for export, but given the small share of the domestic market in Uralkali's sales volume, a decrease in prices in the domestic market will not have a large impact on the company's performance, unlike the export duty.

Scientific and technical environment

Uralkali pays serious attention to information technology and invests heavily in automating its own business processes. In 2003, the enterprise implemented the Oracle E-Business Suite ERP system - one of the most full-scale Oracle projects in the CIS in terms of the number of implemented modules.

Production and sales volumes of KCL, million tons

In 2009, Uralkali completed another audit of its labor protection system. The experts in the field of labor protection from the Perm State Technical University (PSTU) paid the main attention to the issues of labor protection management, interaction with contractors working on the company's territory, organization of work on labor protection at all four mining departments.

In 2005, the company completed certification of workplaces in terms of working conditions, then certification of work on labor protection was carried out, and OAO Uralkali was issued a Safety Certificate (certificate of compliance of work on labor protection with state regulatory requirements for labor protection). In 2009, in accordance with the requirements of the legislation, a special commission of the Occupational Safety and Health Certification Authority conducted a scheduled inspection check of certified labor protection works at Uralkali.

The expert commission confirmed that Uralkali's activities are aimed at creating and maintaining safe working conditions for employees and comply with the requirements of labor legislation and state regulatory requirements for labor protection. Based on the results of the audit, the validity of the Certificate of Conformity for labor protection work was extended until January 2011.

Sales volume in 2018

In 2018, the company sold about 76% of its products on foreign markets; exports are carried out to more than 60 countries of the world.

The main sales markets are Latin America, South East Asia, China, India and Europe.

Main subsidiaries

LLC SMT BShSU. The company carries out construction and installation works. The enterprise includes repair and construction departments and a mining and preparation department, as well as a powerful production base.

LLC "Vagonnoe Depo Balakhonzy". The company carries out repair and maintenance of freight cars for PJSC Uralkali.

Uralkali Repair LLC. The company carries out repairs and maintenance of machinery and equipment.

Autotranskali LLC is a transport company with a fleet of about 780 vehicles. mineral wagons.

JSC "Baltic Bulker Terminal" is a marine terminal that transships mineral fertilizers from railway trains to sea vessels for further transportation.

JSC "VNII Galurgii" is a research institute engaged in research in the field of mining and chemical industry. It consists of 14 research laboratories, as well as 24 design departments, located in St. Petersburg and Perm.

Uralkaii Trading SIA and Uralkaii Trading Chicago are trading companies selling products in key sales regions for the company.