Two new coal mines will be soon put into operation in Russia – Denisovskaya in Siberia and Sherlovskaya-Naklonnaya in the European part of Russia.

The construction budget of the Denisovskaya mine totals about $US115 million. The mine is scheduled to be completed by December 2004 but coal winning will be done simultaneously with development works. The mine has about 51Mt of coal reserves and annual production will be 3mt, targeted for export to Japan and South Korea. The mine is using one modern roadheader and has plans to buy two more, as well as new face equipment. The construction of the preparation plant is planned for the future.

Donskoy Ugol’s Sherlovskaya-Naklonnaya mine will be a modern coal enterprise with projected annual capacity of 650,000 tonnes. Negotiations for the supply of mining equipment are now under way. Donskoy Ugol Coal Company (Donugol) plans to build one more mine – Obuhovskaya-1 - and a preparation plant in the near future.

International Financial Corporation (IFC) plans to have Donugol as a pilot company in the ‘Corporate Management in Russia project.’ The aim of the project is the preparation of necessary conditions for foreign investments into Russia.

Meanwhile, President Vladimir Putin at a meeting with Global Energy Prize winners said Russia’s energy strategy till 2020 will be developed in near future. It will determine the main directions of State policy in energy and regulate the interaction between the State and business. Putin said there should not be any difference between Russian and foreign companies. In his opinion, Russia is capable of becoming an important link in global energy security.

In late spring, German company Becker Mining Systems opened its subsidiary - Becker Mining Systems Siberia – in Kemerovo. The company’s equipment is currently in use at two mines in the Kuzbass coal basin and Becker plans to expand to other mines. Beckers also has installations at other mines in Siberia, Vorkuta and Kazakhstan, and the subsidiary will service those operations too.

The first stage of the Ust-Luga coal terminal with a handling capacity of 1Mt a year was recently put into operation on the Baltic Sea. In 2005, when construction is complete, full capacity will reach 8Mt. Ust-Luga will become the second largest Russian coal terminal after Vostochny on the Pacific Ocean. Terminal construction is being financed through the combined efforts of the Russian State and Kuzbassrazrezugol Coal Company – Russia’s largest coal exporter.

It appears as if Kuzbassrazrezugol is also participating in the construction of a coal terminal in Estonia, also on the Baltic, according to media speculation. The project capacity of the terminal is 5Mt per annum. It seems that the reason Kuzbassrazrezugol wishes to conceal its name is because construction in Estonia conflicts with Russian State policy of redirection of export flows to national ports.

Nevertheless, Baltic countries continue to play an important part in Russian export flows. In 2003 Russian coal exports through Latvian ports is forecast to be 7Mt, about one eighth of Russian terminal capacity.