Nornickel to switch to cleaner natural gas fuel at Polar operations

Russia’s Nornickel plans to gradually replace diesel fuel with cleaner natural gas at its Polar operations, the company said in a statement on Tuesday.

“The company intends to increase its investments into industrial safety and an upgrade of energy infrastructure, gradually substituting the use of diesel fuel with natural gas that has a lower carbon footprint,” said Nornickel citing its CEO and co-owner Vladimir Potanin.

Separately, the company, the world largest producer of palladium and refined nickel, has said that it plans to build a liquefied natural gas plant to produce fuel for its dump trucks.

Nickel is used to produce batteries for electric vehicles, which are facing growing demand worldwide. Palladium is a key component in car exhaust filters.

Potanin holds a near 35 percent stake in Nornickel.

The company’s value has grown despite a court ruling on February 5 ordering the company to pay 146.2 billion roubles ($1.99 billion) in damages over the diesel fuel spill in May last year.

In a bid to step up its environmental protection game Nornickel announced the closure of two smelters in Monchegorsk and Nikel in the Russia’s north-west. Both facilities were once considered heavy polluters, mainly due to intense sulphur dioxide emissions.

The company has announced plans to cut SO2 emissions at the north-west operations by 85 percent by the end of 2021.

In its financial statement on Tuesday Nornickel said the company had posted a net profit of $3.6 billion in 2020, down 39 percent year-on-year, gross operating profit stood at $7.6 billion, down three percent.

A dip in profit was due to the write-down of the $2 billion in environmental damages as well as extra costs to fight COVID-19 pandemic, the company said in the full year results report.