International "Astana Mining & Metallurgy" Congress
18-19 June 2020
Nur-Sultan, Kazakhstan

Kazakhstan Potash Company starts exploration of potash deposits

In February, the Western Kazakhstan Delegation of Kazakhstan Potash Company (KPC), listed on the Australian Stock Exchange, held a series of meetings with the Ministry of Industry and Infrastructure Development and the Head of Aktobe region.

This is stated in the March publication on the company's website. The delegation’s visit to Kazakhstan was led by KPC managing director Liu Senlin. The main topic of the trip was the exploration and development of Zhilyanskoe potash project in Aktobe and Chelkarskoye field in the West Kazakhstan region. In addition, the status of the acquisition and development of the Satimola potassium-boron deposit in western Kazakhstan was discussed with the Kazakh side.

During meetings at the Moscow Institute of Railway Engineering and administration of the Aktobe region, Liu Senlin presented a plan for exploration work on three projects. The relevant department expressed support for the KPC project vision and its investment in the field in the future. The ministry also noted the willingness to work closely with the company's technical team to approve the exploration plan on time, the report indicates.

According to the company, Kazakhstan Potash Company obtained subsoil use rights for Zhilyanskoe and Chelkarskoye in 2011. In 2014, Reuters reported on its plans to invest $3.8 billion in deposits and potash production in Kazakhstan. CITIC Construction Corp., which had been contracted, was planning to build a turnkey mine at Zhilyansky for $550 million.

In 2015, KPC tried to buy out the Satimola field, owned by SATBOR, a foreign-owned, but then the deal fell through. At the end of last year, the company announced that it eventually gained control over the boron-potassium asset. The public in Aktobe opposed the development of the Zhilyansk field in 2016 due to concerns about environmental degradation in the region and failures in the land of residential neighborhoods.

The subsidiary of KPC insisted that the extraction of potassium will not lead to negative consequences. According to the information on the website of the company, the Zhilyanskoe deposits in the Aktyubinsk region and the Chelkarskoye in WKO belong to it through the local subsidiary, Batys Kaliy. In December 2017, Kazinform reported that the administration of the Aktobe region sent a letter to the MIID about taking measures with respect to Batys Kaliy. Obviously, it was a question of default on obligations under a subsoil use contract, which, logically, should have led to a change or withdrawal.

On the sidelines of the 25th World Mining Congress in Astana last June, Akbatyr Nadyrbayev, the chairman of the Geology and Subsoil Use Committee of the Ministry of Investment and Development, confirmed that exploration at Zhilyansky and Chelkarsky had been carried out, but the subsoil users had not passed to the production stage for an unknown reason.

“Satimola is the same, the exploration stage has been completed, and there the shareholders have changed, the Chinese company outbid, but again this transition to the production stage is currently stalling, they can’t start, and I can honestly say that there are no problems there, it’s just the problem of the shareholders themselves, the subsoil users,” Nadyrbaev explained.

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