Strengthening trade relations
The Canada Eurasia Russia Business Association aims to serve business in and support trade between Canada, Eurasia and Russia
1 of 2Lou Naumovski, who is with Kinross Gold Corporation, spoke at the recent CERBA conference in Toronto. — Photo courtesy CERBA
2 of 2A panel discussion was held during the 2013 CERBA conference at the PDAC convention in Toronto. — Photo courtesy CERBA
Founded in 1993, Kinross Gold Corporation has quickly grown to become one of the world's leading gold-mining companies. Kinross is active in mine-site, brownfield and greenfield initiatives across four continents and in nine countries—the United States, Canada, Mexico, Ecuador, Brazil, Chile, Mauritania, Ghana and Russia. In North America specifically, Kinross is focused on mine-site and near-mine exploration in and around its Fort Knox Mine in Alaska, the Round Mountain Mine in Nevada and the Kettle River-Buckhorn Mine in Washington—as well as development and grassroots exploration in Canada and Mexico.
Mining & Exploration recently spoke with Lou Naumovski, vice-president and general director in the Moscow Representative Office of Kinross Gold Corporation. We asked Naumovski about mining relations between Canada and Russia and about the Canada Eurasia Russia Business Association (CERBA) event that took place in March at the Prospectors & Developers Association of Canada (PDAC) convention in Toronto; the PDAC conference is the world’s leading convention for people, companies and organizations in or connected with mineral exploration.
The CERBA event has been held for 13 years in a row and has grown from a roundtable with few participants held sometime during the PDAC convention into a two-day event within the official programming of PDAC that attracts some 200 people. It is a joint effort of several Canadian government agencies (including DFAIT, NRCan, EDC and AANDC) and CERBA's private-sector members.
Can you give us a brief overview of CERBA?
The Canada Eurasia Russia Business Association has a mandate to serve business in Canada, Eurasia and Russia by enhancing and supporting trade, investment and good relations between these countries. CERBA is a not-for-profit organization with a network of over 180 corporations. To meet the dynamic needs of our growing membership, we operate through seven chapters—in Moscow, Toronto, Montreal, Ottawa, Calgary, Vancouver and Almaty (Kazakhstan).
As an association, CERBA provides an extensive network of contacts in the private and public sectors, with frequent events, informative seminars on pertinent topics in the Eurasian market, a biannual business summit, a quarterly printed newsletter, committees of the Canada-Russia Business Council (CRBC), and annual trade missions. Additionally, CERBA provides market intelligence, advocates with the Canadian and Eurasian government on key issues, and manages active sector-based committees to promote partnerships between CERBA members and their counterparts in Eurasia.
What is the association doing to strengthen the relationship between Canada and Russia in particular with regards to mining?
By conducting such events as the PDAC conference or a technical mining conference held around the Association for Mineral Exploration British Columbia (AME BC) Roundup in Vancouver, CERBA is providing the governments and private sectors of the participating countries' forums (the chance) to openly share views and get the latest and authoritative information directly from the relevant sources.
At the annual conference in Toronto—home to the majority of the Canadian investment community—we are catering to several audience types. For Canadian mature and junior miners who are working (or) planning to work in Russian and Eurasian markets, we are bringing content that provides clear and critical assessment of what sorts of economic, political and other factors define the natural resources industry in the region. The forum also provides access to policy and decision-makers representing these countries and an opportunity to share the industry experiences. For Canadian suppliers and service providers, besides the general market intelligence information, we are gathering potential private/public-sector customers in a single room. When it comes to foreign delegates looking for potential partners, investors, and suppliers, this is a highly appropriate place and time to be able to communicate their needs and find solutions for their projects.
We are also making sure our members are encouraged to actively participate in the bilateral dialogues by including them in the work, for instance, of the Canada-Russia Mining Working Group, which is an integral part of the Intergovernmental Economic Commission, at which both sides can address issues relevant to the mining sector in both countries.
What benefits does the Canadian mining industry earn through this partnership?
There is still unfortunately a lot of inaccurate or insufficient information concerning foreign investment in the mining sectors of Russia and the countries of Eurasia. Many people in the global mining industry, for example, still believe that foreign investment in Russian mining is either completely forbidden or restricted to only minority shares in exploration or producing assets. This is untrue, and over the past four years at the CERBA conference, we have provided detailed information about the actual regulations and also first-hand reports from companies such as Kinross and other junior miners that are successfully exploring or even producing precious metals in particular in Russia, such as Kinross.
Canadian mining equipment and services companies also get an opportunity to learn about the various companies and their current and future projects for which Canadian goods and services will be required.
Can you tell me about the recent trade mission to Russia?
In June 2012, Ed Fast, minister of international trade and minister for the Asia-Pacific Gateway, led a trade mission to Russia on which he was accompanied by nearly 30 Canadian companies in the fields of mining, construction and building products, and aerospace.
While I cannot speak for those members on the Fast mission from the mining industry, the companies that I met with on the mission and subsequently seem to have been enthused and excited about their prospects on the Russian market. A number of these firms that had not previously been to Russia have now returned several times to pursue sales leads, and those that had already made some inroads into the market have been pursuing new leads that they established during the mission.
What is the importance of having the CERBA Russia & Eurasia Mining Conference?
CERBA’s mining conference promotes the collaboration between Canadian, Russian and Eurasian business leaders and decision-makers. It is a truly unique event for those interested in doing business in today’s dynamic and growing natural resources markets in Russia and other mineral-producing regions of Eurasia. These markets are increasingly attractive for Canadian and international business and investors. We are observing many interesting new dialogues, long-term relationships and productive business partnerships take off as a result of this business gathering.
What did you speak on at the conference?
As moderator of the first panel, I tried to provide a contrast between the negative perceptions of the potential for foreign investment in Russian mining with the reality of Kinross’s success in investing in Russia since 1995.
In my own presentation later in the conference, I described how from our initial investment in the Kubaka Mine in the Magadan region—out of which we managed to produce more than 80 tonnes of gold—through to our high-grade Kupol Mine—that went into production in May of 2008, and which has already surpassed three million ounces of gold-equivalent production—and through to our Dvoinoye Mine that will be commissioned by the end of 2013, Kinross has enjoyed success in Russia.
Regrettably, our example is unique in the Russian market, and we have consistently tried to explain that our success is due to persistence, to the establishment of durable partnerships in the country, to our effective engagement of stakeholders at all levels of government and society in the regions in which we work and at the federal level in Russia, and to delivering on our promises to be an effective, efficient and responsible operator.
