President’s Letter

Dear colleagues,

Vladimir Potanin

Climate change is a global problem and one of the greatest challenges that humankind has ever faced. Its impact is already visible around the globe: from the equator to polar latitudes. Talking about the Arctic, which is home to the key production assets of Nornickel, the temperature rise here is several times as fast as across the planet on average.

Climate agenda remains one of our sustainability priorities. We have ambitious goals to mitigate our climate impact while also adjusting our operations to climate changes that are already taking place and that are projected in the future.

With our production chains and infrastructure located in the Arctic, we put an emphasis on analysing risks related to permafrost thawing. We focus on analysing ongoing climate changes and developing relevant adaptation measures to maintain business continuity and enhance occupational safety. The ongoing initiatives include an automated monitoring system for the foundations of buildings and structures we are rolling out in the Norilsk Industrial District to monitor changes in soil temperature at foundations and deformation behaviour in them. In 2021–2022, we installed over 1,200 sensors at 165 facilities covered by the project, commissioned an information and diagnostics system, and set up a control unit. Our assessment shows that until 2028, physical risks related to climate change will be mitigated by activities targeting improvements in the reliability of production assets and infrastructure.

OPEX and CAPEX associated with climate change-related activities stood at RUB 8.9 bn in 2022, helping deliver considerable savings in energy and resource efficiency of our operations. In 2022, we also increased the share of renewable sources in our energy mix to 51% (from 47% in 2021).

Global transition to low-carbon economy is creating market opportunities for our portfolio of green metals. As renewable energy construction is ongoing and electric vehicles and hydrogen economy are gaining momentum, we already see greater demand for our metals. Nornickel invests considerable efforts in decarbonising the global economy, and we expect the demand for our products to steadily rise, which will contribute to our sustainable and well-balanced growth.

With climate change seen as a global issue, we seek to expand our partnerships with stakeholders and look for collaborative solutions. On an ongoing basis, Nornickel liaises with the academic community to enhance in-house expertise and conduct joint research. In 2022, supported by the Russian Academy of Sciences, we engaged in climate change scenario modelling for territories across our footprint, and developed our own global economy and climate change scenarios until 2050 to assess risks and opportunities.

I appreciate the dedication of all our employees and their commitment to the efforts that are currently underway and that I hope continue going forward.

President and Chairman of MMC Norilsk Nickel Management Board
Vladimir Potanin