Nornickel to Stabilize Water Inflows at Mine by Next Week

(Bloomberg) -- Billionaire Chief Executive Officer Vladimir Potanin said MMC Norilsk Nickel PJSC plans to stabilize water inflows at one of its biggest mines in the Russian Arctic by March 9. Nickel prices slid the most since 2016.

Nornickel partially suspended output at the Oktyabrsky mine and the interconnected Taimyrsky operation last week after the inflows, first detected on Feb. 12, intensified at Oktyabrsky. The miner is installing a cofferdam at the mine.

“Colleagues expect to finally achieve a turning point and stabilize the situation by March 9,” Potanin said in a commentary forwarded by Nornickel's press office. “There will be certain losses for production.”

Those losses will also be quantified by next week, said Potanin, adding that the most important thing is that neither people, nor the environment will be affected. Nickel prices, which rose after last week's announcement, dropped as much as 7.7% in London on Wednesday, before paring some of the loss.

The mine inflow is the latest setback for Nornickel, the world's biggest producer of palladium and refined nickel. The miner must pay about $2 billion in compensation after a massive diesel spill from one of its fuel tanks in the Arctic last year. Last month, three people were killed when a roof of the the ore reloading facility and adjoining walkway at the Norilsk concentrator plant collapsed during repairs.

The concentrator, which process ore, including from the water-affected mines, is currently working at reduced capacity and Potanin said that the company expects to restore its operations after March 15.

On Wednesday, Potanin is visiting Norilsk, close to the Arctic spill site, for the first time since June, when he was checking on the fuel spill.

This week, Chief Operating Officer Sergey Dyachenko became the most high profile person to leave the Russian miner following the series of environmental and safety incidents.

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