It is dark in this remote Russian city. Located above the Arctic Circle in Siberia, the city’s inhabitants do not see light for six weeks in the dead of winter. Snow covers the ground between 250 to 270 days a year. But sadly, the snow is yellow and black from acid rain.
This is Norilsk, founded in 1935 as a slave labor camp, and now known for possessing the world’s largest deposits of nickel and palladium. Russia has about 40% of the world’s known resources concentrated in Norilsk, and the Russian mining company Norilsk Nickel, the primary employer in the city, mines it for the global market. It is the world’s biggest producer of nickel and palladium, accounting for 18.8% and 46.3% of global production, respectively. The town accounts for 90% of Russia’s nickel and 55% of its copper and over 90% of its sales are to foreign customers. Currently, ore deposits are being extracted at more than 1,200 meters below ground.
Estimates have shown probable ore deposits in the city totaling 478.7 million tons, which include 6.27 million tons of nickel, 9.37 million tons of copper, 62.2 million ounces of palladium and 16 million ounces of platinum, enough to keep the citizens employed for the next 30 years.
In a nation whose economy is fueled chiefly by oil, which accounts for 30% of the GDP, nickel seems to lose its shine. But Russia is one of the world’s largest mineral producers accounting for 20% of the world nickel and cobalt production and oil czars rub shoulders with mineral oligarchies, formed in recent years. The largest demand for nickel is from the steel industry, which accounts for 65% of total demand. Europe represents the highest demand for steel amounting to around 430,000 metric tons, with Asia coming a close second particularly in China. Nickel is one of the most wanted items in China and demand has been robust since 2000 exceeding the combined output of Germany and Spain in 2006. Russia became the number one producer pushing aside Canada in the 1970s, and today Russia holds about one-fifth of the global share in nickel production. The world’s total mine production is around 1.4 million tons and the Commonwealth of Independent States (CIS) are the largest producers of mined nickel contributing to 19.77% of the world’s production.
Today, with nickel prices topping $50,000 per ton in response to soaring demand from steel producers, nothing in Norilsk is allowed to go to waste. The heavy metal pollution is so severe that it is economically feasible to mine the soil. Nickel dust on the streets mixes with the snow and in the spring, thaws into black sludge. Special mining crews scoop up this rich waste and return it to the factory where it is refined into pure nickel and other metals, and then sold.
The average salaries here are $2,080 per month for private employees and $1,450 for government employees, which are about 2.6 times higher than the national average, making the world’s second largest city above the Arctic Circle, an attractive job market. The nearest large city, Krasnoyarsk, is a 1000 miles away but Norilsk’s remoteness does not reduce its global importance. Its environment may be just a ghost of greenness, but for the Russian economy it is very much a shining star of prosperity.
Postcards from Around the World
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