Millhouse Capital, controlled by Russian billionaire Roman Abramovich, is considering selling the Pyrkakay tin deposit, one of the largest in the world, Kommersant business daily reported on Wednesday.
The company estimates Pyrkakay, in Russia’s easternmost Chukotka region, is worth $300 million, the paper said, referring to sources.
Millhouse believes the deposit, with 228,500 tons of tin and 23,000 tons of tungsten reserves, may be of interest to companies from Southeast Asia, primarily China and Malaysia.
China’s state-owned Shenhua Group whose representatives visited the Pyrkakay deposit last year is viewed as a potential buyer, one source told the paper, while another source said he had doubts about the Chinese company’s intentions because Shenhua, the world’s largest coal producer, is focused on coal production.
“Millhouse is so far holding no specific talks with any bidders,” Kommersant said.
Investment in the Pyrkakay deposit development is expected to reach $300 million, with production scheduled to begin in 2017. From 2018, the deposit is projected to produce about 6 million tons of ore to make 11,100 tons of tin and 814 tons of tungsten annually.
The Pyrkakay deposit is estimated to have a stable production life of 20 years, the paper said.
Millhouse declined to comment to Kommersant on its intentions regarding deposit..