Russia Eases Procedure for Obtaining Deposits in Arctic and Far East

The declarative principle has been expanded for the provision of subsoil plots for geological exploration for areas with projected P1 and P2 category solid mineral resources in the Far East and the Arctic per the conditions of entrepreneurial risk. The relevant amendments were made to an order of the Russian Ministry of Natural Resources and Environment that regulates the procedure for reviewing applications for the right to use subsoil plots for their geological study. The Russian Ministry of Natural Resources and Environment drafted a set of measures at the fourth Eastern Economic Forum in September 2018 to improve legislation in geological exploration, including an expansion in the so-called declarative principle for subsoil plots with projected P1 and P2 resources.

“Developing the Artic, such as by attracting investors, is a strategic task set out by the country’s leadership. To that end, the Ministry for Development of the Russian Far East and Arctic is coordinating with other ministries and agencies to develop proposals to change existing laws and regulations and propose new instruments in order to deliver new projects in the Arctic, as well as in recently acquired regions, with the aim of ultimately changing the lives of those who live in the Arctic zone,” said Alexander Kozlov, Minister for Development of the Russian Far East and Arctic.

The projected resources of the subsoil plots (i.e. plots where there are no confirmed mineral reserves) are divided into three groups based on the degree of their justification: P1, P2, and P3. P3 projected resources only take into account the potential feasibility of the discovery of deposits of a particular type of mineral. The declarative procedure for their provision was introduced in the past. P2 and P1 are subsoil plots that have a higher probability of discovering and confirming reserves.

“We have found opportunities to expand the declarative principle for subsoil plots containing P1 and P2 high category mineral resources. The relevant changes to the regulatory acts are already in effect. This will increase investments by several times over and enhance the economic indicators for the development of the territory of strategic regions. According to the country’s Mineral Resource Base Development Strategy for the period until 2035, we plan to attract at least 10 roubles of investments for each rouble of budget funds. The regions will get a new incentive for development from this”, Russian Minister of Natural Resources and the Environment Dmitry Kobylkin said

Subsoil plots with P1 and P2 projected forecast resources were previously provided exclusively based on auction results. Following the amendments to the application review procedure, any subsoil plots that do not have confirmed reserves, but have P1 and P2 projected resources can be provided without holding an auction. They are provided to whoever was the first to submit an application for them. At the same time, one entity may not obtain more than three subsoil plots during a calendar year. 

Russia’s Arctic zone contains an enormous about of mineral resources. According to the Russian Federal Geological Fund, the State Reserves Register includes more than 980 solid mineral deposits and over 280 sites with field-tested forecast resources. The Arctic’s subsoil plots include 97.3% of platinoid reserves, 43% of tin reserves, and a substantial amount of nickel, titanium, apatite ores, and rare-earth metal ores. The explored reserves supply nearly 98% of platinum, 100% of titanium, zirconium, rare earth metals and apatite ores, and more than 97% of nickel produced.