"It is planned to form an investment consortium of leading Chinese companies in the sector and financial institutions," Metalloinvest said in a statement.
Valery Kazikayev, chairman of Metalloinvest's affiliate BGK, the holder of the Udokan license, noted the importance of the organization of project funding and attracting shareholders' capital and long-term loans.
"Under the agreement, HOPU Investments plans to purchase a minority stake in the project before the end of this year," Kazikayev noted.
Udokan is Russia's largest and the world’s third largest copper field, estimated to contain 26.7 million tons of metal. The license to develop the field belongs to an affiliate of Metalloinvest. Usmanov has a 60% stake in Metalloinvest, Russia's largest iron ore producer.
Under the terms of the license, production in Udokan had to began in 2014 (processing of 12 million tons of ore a year) while full capacity (36 million tons of ore a year) was expected in 2016. However due to complex geological specifics, Metalloinvest repeatedly postponed the development timeframe. The precise dates of the beginning of project implementation depend on the availability of external infrastructure.
In April 2014, Minister of Natural Resources Sergei Donksoi told ITAR-TASS that the Russian government had approved the new postponement of the beginning of cooper ore production to 2020, while reaching full capacity (36 million tons of ore) was postponed to 2024.
The project's payback period on the condition of state support and the construction of external energy and transport infrastructure is estimated at 15 years.