IRC Ltd, the iron ore unit of Russian miner Petropavlovsk Group of Companies (Petropavlovsk), has announced that in 2010, its financial results reflected a $82.4 million loss, 14 percent better than forecast and 40.9 percent better than in 2009.
In 2010, IRC's revenue increased by $17.5 million compared to 2009 to $25.8 million, mainly due to the formal commissioning of operations and sales generated from its first mine and beneficiation plant Kuranakh, Russia's first vertically-integrated titanomagnetite processing and production plant, which is situated in the Amur region, bordering the Chinese province of Heilongjiang.
In 2010, IRC achieved the revised 2010 production targets for Kuranakh, which produced 150,533 mt of iron ore concentrate and 2,725 mt of ilmenite. Sales of iron ore concentrate from Kuranakh to a steel producer in China's Heilongjiang Province are ongoing under a long-term off-take agreement. IRC expects to achieve a price increase for sale of iron ore concentrate during 2011 and so achieve a price closer to local market prices.
During 2010, substantial operational work in the development of IRC's K&S Mine continued with 1,000 mt of iron ore being successfully produced as part of the trial process. In January 2011, China National Electric Equipment Corp (CNEEC) started construction at the mine, pursuant to a $400 million engineering, procurement and construction contract, which was signed ahead of schedule, in early December 2010.
The K&S Mine will initially comprise an operation designed to manage 10 million mt of ore volume per annum at two open pits. The total mine output will be processed onsite, yielding an expected 3.2 million mt per annum of iron ore concentrate. The start of the ramping-up process will be from 2013.