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Erlan Sagadiev

KAZAKHSTAN - Industry

Cu There

CEO, Frontier Mining

Bio

Erlan Sagadiev has a MSc in Economics from the University of Minnesota, and has gained professional experience in a variety of sectors, including food, mining, oil and gas, and education. Over the last five years he has headed up the University of International Business (UIB) in Almaty, Zere Group in Kazakhstan, and FoodMaster International (US). He is currently the CEO of Frontier Mining.

"We need to increase the number of independent small producers because they are driving the industry."

What investments has Frontier Mining made in the Benkala copper plant project in Aktobe?

The project has two stages of investment. The first stage requires approximately $54 million and the second stage will call for an additional investment of $74 million. So far we have invested about $48 million, and we have about $6 million to go before the first stage can be completed. The plant is scheduled to begin production in April 2012, and it will be the first plant in Kazakhstan capable of producing copper from ore, a well-known technology, comprising 20% of the world’s copper extraction processes. We began our company working with gold production. However, we ceased the production of gold and decided to focus on copper. All of our copper deposits are located in Kazakhstan. We are currently capable of producing 7,000 tons of copper per year and we aim to increase our capacity to 20,000 tons in 2012.

How does Kazakhstan’s copper industry contribute to the world supply?

Kazakhstan is a small producer of copper. We work with two types of copper: oxides and sulfides. The technology used to extract both is different. Over millions of years the top layer of red copper rusts and you end up with oxides. The copper in oxides has generally separated from the rock and sits in free form. We crush the copper ore, leach it with sulfuric acid, and plate the copper out using electricity. In the 1940s, 1950s, and 1960s Kazakhstan did not have the technology needed to produce copper leached from oxides. It was extracted and put into large dumps of ore. Now, some companies are processing the copper in these dumps using new technology.

“We need to increase the number of independent small producers because they are driving the industry.”

How do you see the role of small- or mid-sized producers like Frontier Mining in realizing the full potential of Kazakhstan’s mining sector?

We need to increase the number of independent small producers because they are driving the industry, researching the technology, and industrializing the country. We help the country by creating jobs and investing in new technologies.

How can Kazakhstan take advantage of its mining resources more fully?

Every year, Kazakhstan pays international consultants millions of dollars to design processes and plants, and advise about the industry. We have started investing heavily to develop an expertise here and to spread the knowledge throughout the industry. The sooner we do it, the better. In the future, we want to be able to consult other companies throughout the world on the production of, say, uranium. There are also a lot of segments based around the extracting industry, such as machinery, equipment, education and analysis, and chemical laboratories. With the expansion of the mining industry, these segments will grow as well.

© The Business Year – March 2012

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