Nornickel and Atomflot sign a long-term charter contract for a new icebreaker

Moscow, December 8, 2022 - The parties signed the contract earlier today at a forum called 'Arctic: Today and the Future' held in St Petersburg. The signatories were Sergey Dubovitsky, Nornickel Senior Vice President for Strategy, Strategic Projects, Logistics and Procurement, and Leonid Irlitsa, Atomflot Acting General Director.

The new contract is unprecedented in duration. A Project 22220 icebreaker will escort vessels navigating the Northern Sea Route in the interest of Nornickel for a period through 2041 and extendible through 2051. Currently, Nornickel charters Sibir - a nuclear-powered icebreaker of the Project 22220 type - under a short-term contract. Since early 2022, she has supported year-round navigation on the Murmansk/Arkhangelsk - Dudinka route and escorted ships in the Yenisey Gulf at a service speed.

The contract provides for breaking land-fast ice in the Yenisey River and maintaining navigable passages from the Yenisey Gulf to the port of Dudinka. It also includes icebreaker support for the vessels travelling in the area stretching from the western edge of the ice to the port of Dudinka and/or in the opposite direction (western section of the Northern Sea Route and the Kara Sea).

The new contract makes part of the far-reaching partnership between Nornickel and Rosatom aimed at developing the Northern Sea Route. The partnership meets long-term interests of the parties: Nornickel as a major consumer of icebreaker escort services is guaranteed icebreaker support for an extended period, while Rosatom as the Northern Sea Route infrastructure operator secures orders for its current icebreaking fleet and a source of funding for the construction of new icebreakers.

Nornickel charters two nuclear-powered icebreakers Vaygach (Taymyr type) and Sibir (Project 22220) operated by Atomflot and one diesel electric icebreaker Admiral Makarov operated by Rosmorport. These icebreakers can escort up to 11 vessels to the port of Dudinka every month.

In addition, Rosatom and Nornickel continue to work on the design of a diesel electric icebreaker and collaborate in such areas as icebreaker support in ports and ship repairs.

"A sizeable increase in cargo traffic to the Norilsk Industrial District makes Nornickel hire more icebreaking capacity. The increase is associated with a number of infrastructure projects carried out by Nornickel and other companies on Taymyr, and the launch of a large-scale renovation programme in Norilsk. We have expanded our logistics infrastructure to fulfil those tasks. In particular, the number of sea voyages and cargo traffic in Dudinka during the last winter navigation season increased 75% and 40%, respectively, as compared to the previous years' average. The long-term contract with Atomflot and a new Project 22220 icebreaker chartered on a regular basis will expedite delivery of cargoes to Norilsk and secure successful completion of our strategic projects," Sergey Dubovitsky said at the signing ceremony.

"Our long-standing partners praise the performance of the Sibir nuclear icebreaker on the Yenisey River," Acting General Director at Atomflot Leonid Irlitsa said. "The Project 22220 nuclear icebreaker demonstrated its ability to ensure efficient transportation of Nornickel's products. I would like to note that this contract can be extended for two consecutive periods of up to five years each provided Nornickel is interested in it."

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Nornickel has its own Arctic fleet, which consists of six ARC7 reinforced ice class vessels, including five Norilsk Nickel type container vessels and one Yenisey tanker. The unique design and the Azipod propulsion system allow them to sail though ice up to 1.8 m thick without icebreaker support.

In 2010 and 2011, Nornickel's vessels completed their first-ever independent journey all along the Northern Sea Route in a single navigation season. Crossing the route from west to east and in the opposite direction, they delivered Nornickel's products to the ports of Southeast Asia and returned with a cargo of supplies.

Apart from transporting the Company's cargo, the fleet plays an important role in catering to the needs of local residents, with some 110,000 tonnes of food and consumer goods shipped annually to the port of Dudinka.

Nornickel also owns several river ports, the sea port of Dudinka, and a transhipment terminal in the port of Murmansk. The ports are well equipped to service the Company's ships.

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