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NORNICKEL SHUTS DOWN SMELTER IN NIKEL TOWN

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MMC Norilsk Nickel (MNOD)
NORNICKEL SHUTS DOWN SMELTER IN NIKEL TOWN

23-Dec-2020 / 14:01 MSK
Dissemination of a Regulatory Announcement, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.

PRESS RELEASE

Public Joint Stock Company «Mining and Metallurgical Company «NORILSK
NICKEL» (PJSC "MMC "Norilsk Nickel", "Nornickel" or the "Company")

NORNICKEL SHUTS DOWN SMELTER IN NIKEL TOWN

Moscow, December 23, 2020 - MMC Norilsk Nickel, the world's largest producer
of palladium and high-grade nickel and a major producer of platinum and
copper, is shutting down a smelting shop in the town of Nikel in Russia's
Murmansk region. It is the company's oldest production facility to date. Its
shutdown is part of Nornickel's comprehensive environmental programme, which
aims to significantly reduce the environmental impact at all production
sites. With the closure of the shop, hazardous emissions into the atmosphere
at the Russia's Norwegian border will cease.

Nornickel's President Vladimir Potanin commented: "Today will be a symbolic
event - the melting of the "last ladle", after which the smelting shop will
be closed. This is a historic event for Nornickel. Following the closure of
the smelting facilities in Nikel, we are modernising our metallurgical
production in Monchegorsk, including the construction of new
state-of-the-art facilities. It is important for us to ensure that our own
production meets modern requirements. Nornickel produces commodities that
are in demand and beneficial for the economy of the future - our metals are
used in batteries and car catalysts. This allows us to say that on the map
of our country, on the map of the world, there is an environmentally
advanced company which also produces goods for the green economy."

Murmansk Region Governor Andrey Chibis said: "The company's decision to
close the smelter was certainly a forced measure aimed at reducing harmful
emissions into the atmosphere. But overall, it is a reconfiguration of the
Kola Mining and Metallurgical Company's production facilities,
modernisation, implementation of modern technologies and an increase in the
output of the company's main products in our region. The most important task
initially was to take into account what employees here wanted. To take all
possible measures for social adaptation of the shop's employees. The workers
who wished to remain with the company were offered jobs in other units. For
those who decided to try their hand at entrepreneurship, good starting
conditions were created".

The decision to close the smelting facility was made by Nornickel in
November 2019. The closure will completely eliminate sulphur dioxide
emissions in the cross-border area with Norway. Due to the implementation of
the programme, it is planned to reduce sulphur dioxide emissions at Kola MMC
by 50% in 2020 and by 85% by 2021.

After the shutdown, the customer service and the clean-up service will
continue to operate in the shop. Within a year after the shutdown, the
shop's building will be prepared for mothballing: it will be cleaned,
materials containing non-ferrous metals will be collected and sent for
recycling.

The industrial site may be preserved if an option for its use can be found.
Nornickel supported a competition among investors willing to implement an
industrial or cultural business project at the vacated smelter site. Its
prerequisite was the ecological transformation of the industrial zone, the
creation of green production facilities and new jobs. The winning project
was the establishment of a metallurgical mini-mill for the production of
grinding balls and long products (LLC Sirius). Nornickel plans to support
the winner's project in the form of advisory assistance, commitments to
repurchase part of the products, provide preferential terms and reduced
tariffs for material and technical resources, etc.

With the closure of the smelter, the production chain will be adjusted:
concentrate from the Zapolyarny concentrator will be delivered to
concentrate shipment hubs, from where it will be supplied to consumers. The
technical re-equipment of the plant and the parallel construction of the
concentrate loading facilities are important components of the Nornickel's
environmental project.

A crucial aspect in the decision to close the smelter was support for the
shop's staff. The company used its successful case of shutting down the
obsolete Nickel Plant in Norilsk in 2016 as a model. Nornickel provided
social guarantees for the shop's personnel: convenient transfer to other
company's operations, retraining and pension programmes. Of the 660
employees at the smelting shop, 72% chose to continue working in the
company's divisions. Most of them are already employed, and the procedure
for employment of the rest will be completed shortly. The company will spend
over 900 million roubles for a set of measures and social programmes for the
smelting shop employees in 2020-2022.

Another important issue is the comprehensive development of the area after
the shutdown. In cooperation with regional and municipal authorities, the
company has set up a Development Strategy for the Pechenga District, which
contains fundamentally different approaches to the development of the
territory. In order to implement the strategy, the company has taken on the
responsibility to attract new businesses and social entrepreneurs to the
district. In 2020, a contest was held among entrepreneurs, based on the
results of which 11 entrepreneurs will receive interest-free loans from
Nornickel to develop business projects with a total borrowing amount of 185
million roubles. New enterprises are expected to be opened as early as 2021,
which will open 145 new jobs in the area.

HISTORICAL NOTE

The smelting shop in the town of Nikel is the oldest metallurgical facility
of Kola MMC. Before the Great Patriotic War, the area on which it was
located belonged to Finland. The construction of the smelting shop was
organised by a Finnish-Canadian consortium, Petsamo Nikkeli, in 1938. The
construction was completed in 1942 by Finland and Germany. In 1944 the
factory was blown up when the German army retreated. After Nikel was passed
to the Soviet Union, the reconstruction of the smelter started. On November
19 1946, the first five tonnes of Soviet high-grade matte were produced.

Over 74 years the shop smelted 61.8 million tonnes of nickel-containing
feedstock and produced over 2.4 million tonnes of nickel in high-grade
matte.

Throughout its history, the smelting shop was modernised and expanded
several times. In the 1960s, powerful ore-thermal electric furnaces,
converters and a pilot plant for the production of roasted pellets were put
into operation in the smelting shop. In the 1970s, the converter slag
depletion furnace was commissioned and a sulphuric acid plant was built.

In 1991, the smelting shop in Nikel became one of the largest in the
industry. It was processing 1.33 million tonnes of ore material and churning
out 100,000 tonnes of high-grade matte per year.

In 1998, the smelting shop became part of the newly formed Kola MMC. As part
of the smelting shop's emission reduction plan, a number of measures were
taken: automatic charging was introduced in the ore-thermal furnaces, and
frequency converters to control exhaust blowers were installed at the
converter. In 2013, the shop saw the construction of a new casting, a
special platform for installing molds into which high-grade matte is poured.
In 2016, the shop's ore-thermal furnace No. 5 underwent overhaul.

ABOUT THE COMPANY

MMC Norilsk Nickel is a diversified mining and metallurgical company, the
world's largest producer of palladium and high-grade nickel and a major
producer of platinum and copper. The company also produces cobalt, rhodium,
silver, gold, iridium, ruthenium, selenium, tellurium, sulphur and other
products.

The production units of Norilsk Nickel Group are located at the Norilsk
Industrial District, on the Kola Peninsula and Zabaykalsky Krai in Russia as
well as in Finland and South Africa.

MMC Norilsk Nickel shares are listed on the Moscow and on the
Saint-Petersburg Stock Exchanges, ADRs are traded over the counter in the US
and on the London, Berlin and Frankfurt Stock Exchanges.

Media Relations: Investor Relations:

Phone: +7 (495) 785 58 00 Phone: +7 (495) 786 83 20

Email: pr@nornik.ru Email: ir@nornik.ru

ISIN: US55315J1025
Category Code: MSCH
TIDM: MNOD
LEI Code: 253400JPTEEW143W3E47
Sequence No.: 90266
EQS News ID: 1157217

End of Announcement EQS News Service



(END) Dow Jones Newswires

December 23, 2020 06:01 ET ( 11:01 GMT)
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