Page 120 - RusRPTJan22

(InterRAO largely holds a power import-export monopoly in Russia). Given the volatile nature of export revenues and profitability (which is subject to politics), the market will probably not price in much of this export volume in the long-run.
On Tuesday 14 December, CEO of InterRAO Boris Kovalchuk met with Prime Minister Mikhail Mishustin. He noted that InterRAO anticipated favourable dynamics in its 2021 financials: RUB 1,170bn of revenues (+18% YoY), EBITDA at RUB 160bn (+31% YoY) and RUB 90bn in net income (+20% YoY). The company expects electricity demand in Russia to be up 5.5% YoY this year, driven by the economic recovery and the colder/warmer weather in the respective seasons. The results are also driven by the growth in exports (FY21 volumes seen at 21.5bn kWh, with margins expanding) and new acquisitions.
CEO of Enel Russia Stephane Zweguintzow said that the Kola wind farm in the Murmansk region was 60% complete on 21 December: the grid lines are fully built, the transformers have been installed, the unit is connected to the Murmansk substation, 37 wind turbines have been fully assembled (the rest are being completed) and all foundations are ready. "Unless the harsh Arctic climate has an effect, then in May 2022 we should complete commissioning," Zweguintzow added.
9.2.11 Metallurgy & mining corporate news
● Gold & Diamonds
Alrosa has begun stripping operations at Mayskaya pipe. Discovered in 2006 and located 3km away from Botuobinskaya pipe in the Yakutia Region’s Nyurbinsky district, Mayskaya pipe has 12.7mnct in total JORC-compliant resources. The company is budgeting $75mn (RUB 5.6bn) for Mayskaya pipe’s capex, and the pipe is expected to produce 0.3mnt of ore and 1mnct of diamonds, with the first diamond production expected in 2025. Mayskaya pipe is one of ALRS’ projects that should help the company produce 35-36mnct by 2025-26, according to management. We expect ALRS to produce 31.3mnct of diamonds in 2021, with little recourse to the inventory pile in 2H21. ALRS is currently selling almost all of its diamonds, with its inventory level at 8.6mnct at the end of 3Q21 vs. the average pre-2020 level of 16.3mnct, we estimate.
Alrosa CEO Sergey Ivanov has said that the company might ramp up production to 34-35mnct in 2022, reports Interfax. The new production target is 1mnct (3%) above the company’s previous guidance for 2022. We note, however, that the statement is not official new guidance, but a comment from the CEO. We see 3-6% upside to our 2022F forecast of the company’s EBITDA (depending on which asset the company plans to ramp up) and treat the news as positive.
120 RUSSIA Country Report January 2022 www.intellinews.com