INTERROS: Projects: Norilsk Nickel: History

51% stake

placed under MFK-UNEXIM Group management

1995

At the end of the year, the government places 38% of RAO Norilsk Nickel shares (51% of voting shares) under Interros Group management.

>$4 bln

in debt when Interros management team takes over

1996

Anatoly Filatov, the CEO of Norilsk Nickel, is fired for poor management by Russian presidential decree. Alexander Khloponin, a finance expert and the President of MFK Bank, steps in as the new CEO. He appoints Johnson Khagazheev, an expert in industrial production, as his first deputy and head of Norilsk Combine, which at this point includes all of Norilsk Nickel’s assets in the Norilsk industrial area.

When the Interros management teams takes over, Norilsk Nickel is more than $4 bln in debt and four months behind on salary payments. Annual losses amount to $800 mln.

The Interros restructuring program for Norilsk Nickel is based on an integrated development strategy to revive production and return the Norilsk industrial area to normal functioning.

$300 mln

transferred from Interros to Norilsk Nickel to explore the Pelyatkin deposit

1997

In August, Interros acquires the government’s stake in Norilsk Nickel MMC at an investment tender. The winning bidder has to pay more than $270 mln for a 38% stake in the company, 80% more than the starting bid. In line with the commercial terms of the investment tender, Interros transfers $300 mln to Norilsk Nickel MMC in order to develop the Pelyatkin gas condensate deposits. An additional 400 bln rub is allocated for the social infrastructure of the Norilsk industrial area, with its population of 300,000, and for the plant’s debt payment to the Russian State Pension Fund. Interros also pays the salary arrears.

RAO Norilsk Nickel has been current on federal taxes and benefits payments since 1997.

60.4 %

net profit increase for Norilsk Nickel

1998

RAO Norilsk Nickel net profit goes up by 60.4%. Employees’ monthly salaries more than double by the end of the year.

$3 bln

Norilsk Nickel investment program through 2010

1999

The company upgrades production facilities to bring down costs.

RAO Norilsk Nickel and Norilsk Mining Company Subsidiary sign a $6 mln contract with the Sumitomo Corporation of Japan, which will supply trunk pipelines to build the first gas pipeline from the Pelyatkin gas condensate deposit area.

The Board of RAO Norilsk Nickel approves the Company Development Framework through 2010, which will allow Norilsk Nickel to remain a global leader on the non-ferrous and precious metals market. The company plans to invest between $3 and $5 bln in production development.

Murmansk Aviation Company acquires OJSC Murmansk Airlines for $5.1 mln for the benefit of RAO Norilsk Nickel. Murmansk Airlines acquisition allows Norilsk Nickel to streamline transportation costs for the employees of the plant’s subsidiaries on the Kola Peninsula.

The Expert RA rating agency ranks Norilsk Nickel as the second most profitable company in Russia in 1999. (OJSC Gazprom is ranked first).

$5.2 bln

RAO Norilsk Nickel’s total annual metals sales

2000

Norilsk Nickel restructures to shift capitalization from RAO Norilsk Nickel, a managing company, to core industrial assets.

Restructuring helps to increase the company’s efficiency and investment attractiveness. Norilsk Mining Company is now the focus of capitalization; in February 2001 it is renamed Norilsk Nickel Mining and Metals Company.

Alexander Khloponin wins the gubernatorial elections in the Taymyr (Dolgano-Nenetsk) Autonomous District. Johnson Khagazheev becomes Norilsk Nickel MMC’s CEO, soon to be replaced by Mikhail Prokhorov, who will head the company until 2007.

100 %

shares in OJSC Kola MMC acquired by RAO Norilsk Nickel

2001

RAO Norilsk Nickel acquires a 100% stake in OJSC KGMK.

By 2002 the gas pipeline is finished, supplying 100% of the Norilsk industrial area’s gas needs from the 12 wells of the Pelyatkin gas condensate deposit area.

acquires Polyus, Russia’s leading gold producer

2002

In the fall, Norilsk Nickel MMC acquires Polyus, Russia’s leading gold producer, as part of its diversification strategy.

The gradual acquisition of gold assets allows Norilsk Nickel MMC to create Polyus Gold, the largest gold mining company in Russia and a leader in worldwide gold production.

450 young employees

came to work for MMC after graduating from the Leadership and Internship Programs

2003

Norilsk Nickel MMC launches the Production Development Strategy on the Taymyr and Kola Peninsulas through 2015. Capital expenditures increase from $351 mln in 2002 to $446 mln in 2003.

Norilsk Nickel MMC key production and management units begin implementing integrated quality and environmental management systems compliant with the ISO 9001:2000 and ISO 14001:1996 standards.

648 tour packages

to Anapa are purchased to provide a summer vacation for employees’ children

2004

According to Forbes magazine, Norilsk Nickel MMC is among the top 400 companies worldwide.

Russia’s Federal Securities Commission allows Norilsk Nickel MMC to issue additional stock for sale abroad. These shares represent no more than 40% of Norilsk Nickel MMC’s total stock.

The third phase in the exchange of RAO Norilsk Nickel for Norilsk Nickel MMC shares begins.

The company is named the best corporate issuer on the Russian stock market.

Norilsk Nickel acquires 20% of Gold Fields Limited shares for $1.16 bln.

Reorganization of the International Sales Department is finalized.

Prime-TASS agency names Norilsk Nickel the company with the best corporate governance among metal companies in its first such rating ever.

Moody’s and Standard & Poor’s assign credit ratings to Norilsk Nickel MMC. (Moody’s is Ba1, stable outlook long-term credit rating).

8.26 bln rub

total cost of the Severniy-Glubokiy mining project

2005

Norilsk Nickel announces its plans to create Polyus Gold, a large gold-producing company comprising Polyus and its subsidiaries (i.e., the Polyus Group) plus a 20% stake in Gold Fields Ltd of South Africa.

The Zapolyarny branch introduces Corporate Pension Premium, a new corporate benefits program.

Norilsk Nickel is ranked third in the Environmental Responsibility of Large Industrial Companies Index put together by the Independent Social Environmental Initiative, a cross-regional grassroots organization, and the Interfax news agency.

Norilsk Nickel ‘s annual report wins in the Information Density category of the 2004 Best Annual Report Contest organized by the Expert RA rating agency with the support of PricewaterhouseCoopers. Norilsk Nickel Corporate Social Responsibility Report wins first prize in the Best Social Responsibility Report category.

14.5 thousand tons

Norilsk Nickel’s first cargo ship’s loading capacity

2006

Norilsk Nickel and Rio Tinto announce a joint venture in Russia to explore and develop mineral deposits. Norilsk Nickel and BHP Billiton are also beginning to collaborate in geological prospecting and mineral deposit exploration in Russia.

Norilsk Nickel is building its own fleet.

Interros-Dostoinstvo Non-State Pension Fund is transferred over to Norilsk Nickel MMC and is renamed Norilsk Nickel Non-State Pension Fund.

The company is awarded Certificates of Compliance with international quality control and environmental stewardship standards.

Standard & Poor’s raises Norilsk Nickel’s credit rating to the highest level among Russia’s private issuers. Moody’s Investors Service brings the company’s credit rating up two levels to investment level.

Norilsk Nickel wins the Company of the Year national award in the Best Corporate Project category.

6.7 sq km

the surface area of the Lebyazhie tailings dump after reconstruction

2007

Norilsk Nickel reorganizes its research and development assets by merging them with the Hypronickel Research and Design Institute in Saint-Petersburg and by opening branches in Norilsk and Monchegorsk.

The company acquires a stake in the OGK-3 wholesale generating company. Norilsk Nickel begins to develop an ambitious plan to create the largest private energy holding in Russia. The holding is to include the already-acquired and soon-to-be-acquired energy assets.

Rostekhnadzor (the Federal Service for Environmental, Technological, and Nuclear Supervision) and Norilsk Nickel sign a Memorandum of Cooperation in industrial safety and protection of the subsoil and the environment.

Norilsk Nickel is named the best public company in the metals and mining industry in Russia. It receives the first ever Focus Russia 2007 prize awarded by the Thomson Extel Survey.

25% stake in Norilsk Nickel MMC

of Norilsk Nickel MMC shares sold by Mikhail Prohorov to Oleg Deripaska

2008

Early in the year, as Vladimir Potanin and Mikhail Prokhorov divide up their business assets, Interros keeps a 27% stake in Norilsk Nickel. Mikhail Prokhorov later sells a similar stake to Oleg Deripaska’s Rusal United Company. The arrival of the new shareholder almost immediately leads to a dispute that is eventually resolved in 2012 through a shareholder agreement.

Vladimir Strzhalovsky steps in as the new Norilsk Nickel MMC CEO in August.

$2.7 bln

net profit in the recession year

2009

Transportation and logistics areas are experiencing significant change. Norilsk Nickel finishes the construction of its Arctic fleet, creating cost advantages due to independent cargo shipping rates.

NordStar Planes begin servicing Moscow — Krasnoyarsk, Moscow — Norilsk and Norilsk — Krasnoyarsk routes.

The first fundamental and applied research conference New Approaches to Finding Solutions to Environmental Problems of Industrial Companies takes place in Monchegorsk in May. The Greens Russian environmental movement helps put on the conference.

Nadezhdinsk Metal Works celebrates 30 years in October.

Norilsk Nickel receives an award for quality from the government of the Russian Federation and wins in the Foreign Trade Leader category at the Customs Olympus 2009 nationwide competition sponsored by the Federal Customs Service.

1st prize

for the annual report at the Sochi 2010 Forum in the Industry Category

2010

Norilsk Nickel celebrates its 75^th anniversary. It was in 1935 that the Council of People’s Commissioners of the USSR adopted the resolution to build the Norilsk Industrial Complex.

Norilsk Nickel’s 6^th regional corporate forum commemorates the anniversary. Over 500 people celebrate – representatives from different employee groups and company management. Russian President Dmitry Medvedev and Chairman of the Government Vladimir Putin congratulate Norilsk Nickel on its 75th anniversary.

169 meters

length of Enisey tanker built at the Wismar shipyard for Norilsk Nickel, MMC

2011

Norilsk Nickel adopts the Industrial and Technological Development Strategy through 2025. Under this plan, by 2025 the company will become one of the five largest mining companies in the world in terms of capitalization and through a significant increase in available mineral resources and in production at plants in Russia and abroad.

The shareholder conflict has not abated.

300k tons

annual nickel production

2012

In December, Interros, Millhouse and Rusal sign an agreement to settle the shareholder dispute and remedy the situation around Norilsk Nickel MMC.

The Board unanimously appoints Vladimir Potanin Norilsk Nickel MMC CEO. Vladimir Strzhalovsky, the CEO since August 2008, steps down.

30.3% shares

owned by Interros after the quasi-treasury stock package is cancelled

2013

In 2013, Vladimir Potanin and his team change the Norilsk Nickel management structure. This new development strategy is adopted at a Board meeting. The goal of the strategy is to maintain company stability in less-than-ideal market conditions.

Norilsk Nickel pins its hopes on the first-rate high-return assets of the company’s Zapolyarny branch and Kola MMC.

>14 bln rub

spent on environmental protection measures at the Zapolyarny branch

2014

Norilsk Nickel suggests creating a Rapid Development Territory in Taymyr as a step towards developing the Arctic, opening up opportunities offshore and exploiting the Northern Sea Route. It is estimated that the Taymyr extraction and industrial cluster can contribute up to $300 billion to the country’s GDP by 2030. Larger tax payments would increase regional budget revenue by 33%, to $1.4 billion.

Severonickel Plant of Kola MMC, a Norilsk Nickel MMC subsidiary, celebrates its 75th anniversary. The plant produced its first ton of nickel on February 23, 1939.

2.5 times

dividends growth as approved by shareholders in 2014 financial year

2015

Norilsk Nickel has launched pilot operations at its Arctic based Talnakh concentrator plant as part of a first stage upgrade to improve productivity.
The government of the Russian Federation has granted a mining license for Maslovskoye platinum copper nickel deposit, located in the north of the Krasnoyarsk Territory to MMC Norilsk Nickel.
In Spring, Norilsk Nickel held an Investor’s Day in London, presenting a comprehensive strategic update with a focus on new production plan, progress on major investment projects, operating and financial performance as well as latest views on metal markets.
In 2015 CAPEX was set at RUR 105 bln. Norilsk Nickel unveils plans to channel up to RUR 800 bln in modernization in forthcoming years, with RUR300 bln invested in ecological improvement projects.
Norilsk Nickel was granted first place in Russian Major Companies Corporate Transparency Rating 2015. The Company’s Annual and Corporate reports for Y2014 were among winners of the XVIII Annual Corporate Report’s contest. Norilsk Nickel’s charity program «World of New Opportunities» entered top-30 Best Social Projects in Russia rating.

145 bln. rubles

Norilsk Nickel's capital expenditures budgeted for Y2016

2016

February: Norilsk Nickel announces the founding of a palladium fund to work with large metal stockpile holders.

Also in February, the company announces that it will sign on as a general partner of the XXIX Winter Universiade in Krasnoyarsk, to be held in 2019, and will contribute more than 1 billion rubles to the games.

March: MMC Norilsk Nickel’s 2014 SCO Report wins first prize among Russian Federation participants at the Vision Awards LACP 2014/2015. Norilsk Nickel’s Report is ranked 8th in the top 50 reports of non-financial public companies worldwide.

April: Norilsk Nickel signs a partnership agreement with the International University Sports Federation, and in May concludes a similar agreement with the Russian Olympic Committee.

May: Sergey Donskoy, the Russian Minister of Natural Resources and the Environment, awards the Evolution Awards 2016 prize to MMC Norilsk Nickel for environmentally friendly development.

July: The company unveils Norilsk Nickel’s new branding.

August: Norilsk Nickel’s oldest plant is taken out of operation, resulting in a 30 percent drop in sulphur dioxide pollution in the Norilsk residential area.

September: The Norilsk municipal authority, Norilsk Nickel, and the Vladimir Potanin Foundation cofound the Norilsk Development Agency.

November: Norilsk Nickel joins the UN Global Compact, the UN’s largest initiative for corporate social responsibility and sustainable development.

December: Norilsk Nickel’s operational reorganization results in Kola MMC’s Monchegorsk industrial facility becoming the largest nickel refining plant in the world. Aggregate nickel and copper production has increased by 50%.

MMC’s World of New Opportunities Program takes first prize as the Best Program Promoting Philanthropy in Society, part of the 9th Annual Corporate Philanthropy Leaders Project.

Norilsk Nickel’s $1.2 billion investment into its flagship initiative to bring the Bystrinsky deposits in the Zabaykalsky Krai into production wins the Investment Project of the Year award at the Russian Mining Award competition.

800 bln. RUR

will be spent on production modernization until 2020

2017

Norilsk Nickel received an award from the Ministry of Natural Resources and Environment for proactive environmental policy, and was rated by the WWF as one of Russia’s top environmentally responsible mining companies.

Norilsk Nickel celebrated the Year of the Environment with three separate projects: it launched the Sulphur Project at the Zapolyarny branch; brought on line a unit to produce sulfite-bisulfite solution; and rebuilt the flue gas removal equipment at Kola MMC.

In May, Norilsk Nickel worked with the Vladimir Potanin Foundation to create the Norilsk Development Agency. The Agency provides support to projects that aim to make a qualitative difference in the urban environment, to foster conditions favorable for entrepreneurship, including small and medium sized business, to improve the city’s service infrastructure, and to promote job creation.

Upgrade works at the Talnakh Enrichment Plant were finished in June, increasing production capacity by 30%, from 7.6 to 10.2 mln tons of ore per year.

A 956 kilometer long fiber optic line from Novy Urengoy to Norilsk began operating in September. The line’s transfer rate is 40 Gbit per second. The project cost 2.5 bln rubles.

Commissioning and load testing started at the Bystrinsky Enrichment Plant in October. Once it reaches its full design capacity at the end of 2019, the Bystrinksy Enrichment Plant will become Norilsk Nickel’s third largest production asset.

The first equipment system for innovative nickel production came on line at Kola MMC in December. Not smelting nickel anodes increases production efficiency and product quality, while lowering the impact on the environment.

Brand Finance, a consulting company, published a global rating of mining companies’ brands. Norilsk Nickel, the only Russian company on the list, had its brand valued at 675 million dollars.

10 million tonnes

of ore will mine and process Bystrinsky mining and processing plant at full capacity

2018