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Shaft Sinking Begins at Ust-Yayvinsky mine

Shaft Sinking Begins at Ust-Yayvinsky mine

Preparatory works for shaft sinking at the construction site of Uralkali’sUst-Yayvinsky mineare nearly complete.

The drilling of 50 freezing holes that will ensure the freezing of wet soil and safe rock excavation during construction of skip shaft No. 1 was completed in June. The skip shaft will be used to lift sylvinite ore to the surface from a depth of 433.5 metres. The total length of the freezing holes is 12,250 meters and each hole is 245 metres deep. Contractors have begun construction of foundations for the headframe.

At the same time, freezing holes are being drilled at mining shaft No. 2. This is a shaft cage designed for lowering and raising people and loads.

Shaft construction is scheduled to be completed in 2017, while the extraction of 11 million tonnes of ore per annumis expected to begin in 2020. Construction of an administrative and housing complex for the miners of the general contractor Deilmann-Haniel Schachtostroj has also been completed at the production site. A cable rack, transformer substation and pumping plant buildings are ready. The electrical substation ‘Vremennaya’ 110/6 kV, which will provide electricity for the industrial site during the building period, has been launched. Total investment in the mine construction has exceeded USD 1.6 billion. Despite the high cost, the large-scale Ust-Yayvinsky project is one of the most efficient in the world potash industry.

Yevgeny Kotlyar, Chief Engineer of Uralkali, commented:

Uralkali continues to implement its ambitious capacity expansion programme. Construction of Ust-Yayvinsky mine is the main project. We have just completed the drilling of freezing holes and we plan to proceed directly to freezing which will enable us to begin shaft sinking. The construction of a mining facility is a difficult and costly affair. Uralkali is in a slightly different position because construction of the new mine will use the existing infrastructure of the Berezniki-3 concentrating plant, so it is cheaper. The cost per tonne of production will be around USD 600.

For a detailed interview with Uralkali’s Chief Engineer, please visit the Reporting Centre at http://www.uralkali.com/investors/results/.

About the project

The development project of theUst-Yayvinsky sectionof the Verkhnekamskoye deposit includes the construction of a new mine with two mine shafts with a capacity of 11 million tonnes of ore per year (2.8 million tonnes of potassium chloride). The potash ore mined at Ust-Yayvinsky will be processed at Berezniki-3. It will be transported there by a 6.3 km long cable-belt conveyer. In December 2011, Uralkalisigned a contract with Deilmann-Haniel Schachtostrojfor construction of shafts at the Ust-Yayvinsky mine. The contract includes the development of working documentation, construction of temporary structures of the surface tunneling system, shaft sinking and the development of communications infrastructure.

Uralkali (www.uralkali.com/) is one of the world’s largest potash producers with a share of about 20% in global potash production. The Company’s assets consist of 5 mines and 7 ore-treatment mills situated in the towns of Berezniki and Solikamsk (Perm Territory, Russia). Uralkali employs ca. 11,800 people (in the main production unit). Uralkali’s shares and GDRs are traded on the RTS-MICEX and LSE, respectively.

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