23.06.2011
Gremyachinskoe Shaft Sinking Update PRESS RELEASE June 22, 2011

Gremyachinskoe Shaft Sinking Update

PRESS RELEASE

June 22, 2011

Moscow, June 9, 2011 - EuroChem today provides an update on its Gremyachinskoe potash deposit development. The construction of both cage and skip shafts continues as planned and remains on track to allow potash production to start by late 2013. Above ground, another landmark was reached when the headframes for the two shafts were completed.

Shaft Sinkers (PTY) Ltd., a world leading company in shaft excavation, is sinking and lining the 7 meter-diameter cage shaft. As of early June, sinking operations had successfully passed the first major aquifer and cage shaft lining operations were down to -89 meters, while grouting was being performed at -164 meters. Visually impressive, the headframes are vital to future underground operations some 1,150 meters below. The skip shaft will bring potassium to the surface, while the cage shaft will be used to transport mining crews and equipment. Cast iron liners are used to assemble the tubing rings that line the shaft walls. The two shafts will require the assembly of 1,312 rings.

Prior to the start of sinking operations, housing and sinking headgear, including winch and skip, were erected. Additionally, a warehouse for construction material and equipment was built along with repair shops, аn air compressor facility, and a 10/0.525/0.4 kW transformer substation.

The Gremyachinskoe deposit is one of two greenfield potash projects currently being developed by EuroChem. In parallel to the Volgograd project, sections of the Verkhnekamskoe deposit in the Perm region, are currently being readied for ground freezing operations. Both projects have brownfield expansion phases which will bring EuroChem’s production capacity to a total of 8 million tonnes of KCl per year by 2021. The total cost of both phases at both projects is estimated at USD 6 billion, of which USD 1 billion has already been spent.

More detailed overviews of both projects, including visual updates, are available on the EuroChem website as well as in the 2010 annual report.

EuroChem is one of the world’s top ten agrochemical companies by capacity. Vertically integrated with activities spanning from mining to logistics and distribution, EuroChem focuses on nitrogen and phosphate fertilizer production and holds licenses to develop potash reserves in Russia which entitle it to the fifth-largest volume of proven and probable potash reserves globally.

Its main production assets include the Nevinnomysskiy Azot, Novomoskovskiy Azot, Phosphorit, EuroChem – BMU, and Kovdorskiy GOK facilities in Russia and the Lifosa plant in Lithuania.

“Shaft Sinkers PTY” Ltd Republic of South Africa) – has been performing shaft sinking in various types of formations for the last 45 years. “Shaft Sinkers PTY” Ltd has successfully realized a large number of projects: vertical and inclined shaft sinking, preparation of underground levels, ore chute tunneling, and construction of ore bunkers. During last years the company has been dealing with simultaneous construction of up to 17 shafts.

http://www.shaftsinkers.co.za/