Industrial products

2014 Operating Results,
‘000 t

  Acron Dorogobuzh Hongri Acron Total output Commercial products, total YOY Sales
Output
Organic compounds 4011941%195
Methanol 83 – – 83 12 -42% 12
Formalin 144 – – 144 9 11% 9
Urea-formaldehyde resins (UFR) 174 – – 174 174 6% 174
Non-organic compounds 80880820%782
Low-density and technical-grade AN 217 14 – 230 230 1% 208
Calcium carbonate 373 10 – 383 383 52% 383
Liquid carbon dioxide 22 31 – 53 53 -6% 52
Argon 7 – – 7 7 1% 7
Hydrochloric acid – – 136 136 136 5% 132

Acron (Veliky Novgorod)

The Acron facility primarily uses methanol and formalin for further processing and production of urea-formaldehyde resins (UFRs): 86% and 94% of total output, respectively.

In the reporting year, Acron produced 83,000 t of methanol, up 6% year-on-year. Output was in line with in-house and customer demand.

Output of UFRs and formalin was up 10,000 t (6%) and 14,000 t (10%) year-on-year. The Acron facility in Veliky Novgorod developed a fo rmula to produce melamine-based UFRs (2% to 30% melamine), and their production increased year-on-year.

UFRs are used in the wood-processing and furniture industries to produce chipboard and medium and high density fibreboards. The resin market is highly competitive and consumers demand ongoing improvements to product quality and toxic emissions. Acron strives to compete more effectively in this sector and is developing new resin formulas. Sales of melamine-based resins were up in 2014 (9,500 t, against 7,300 t in 2013) for producing chipboard in formaldehyde emissions class 1/2Е-1. Test shipments of resins and formalin in tank containers were conducted. Formaldehyde and urea-formaldehyde concentrate production units reached 100% capacity.

Overall output of non-organic compounds (low-density and technical-grade ammonium nitrate, liquid carbon dioxide, argon and calcium carbonate) increased 23%, mainly due to strong demand for calcium carbonate (sales were up 49%). Output of the remaining non-organic compounds was down 2%.

Dorogobuzh

Output of low density prilled ammonium nitrate was up 700% to 14,000 t in the reporting year. Due to increased demand, calcium carbonate output was up 650% to 10,000 t. Output of liquid carbon dioxide was down 18% (31,000 t against 38,000 t in 2013) because of a scheduled overhaul of ammonia unit.

Hongri Acron

In the reporting year, hydrochloric acid sales were up 5% to 136,000 t. This slight increase was triggered by demand.

Apatite-nepheline Ore Integrated Processing

Acron Group is implementing two innovative projects: development of pilot facilities for nepheline concentrate processing and extraction of rare earth elements from apatite concentrate.

Nepheline-10 Project

Acron (Veliky Novgorod) developed an acid-based technology for nepheline concentrate processing to produce a range of products for the construction, chemical and metals industries.

In 2014, Acron continued construction and assembly at the site where it is building a 10,000-tpa pilot facility for nepheline concentrate processing. Total project investments are estimated at USD 35 mn, and the end of construction is scheduled for 2015.

Rare Earth Elements Project

Acron (Veliky Novgorod) developed a technology for extracting rare earth element concentrate from the apatite concentrate processing workflow to obtain five products: lanthanum, cerium, neodymium, light and heavy REE concentrates.

Since 2011, a pilot unit used to fine-tune the technology has been in operation at Acron’s site. In 2014, the Company completed construction of a 200-tpa production line (measured in terms of lanthanide oxides). In December 2014, carbonates of lanthanum and cerium were produced under a comprehensive testing programme. Completion of a comprehensive testing programme for all processing stages and confirmation of the design target for production performance and product quality is scheduled for the first half of 2015. The project’s total CAPEX is estimated at USD 45 mn.

This project was included in the Rare and Rare Earth Elements sub-programme of a national government programme entitled Industrial Development and Competitive Growth.

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