Russian railways open for business

27 September 2023 9

Private railways are a rarity in modern Russia. With the exception of the Timan Railway (TZD) and short-length access approaches, it is quite difficult to find any other examples on the territory of the Russian Federation. The first full-fledged such project could be the Pacific Railway, which should connect the Elga coal deposit in Yakutia with the port of Elga in the Khabarovsk Territory. Its implementation is currently being carried out by the company "ELSI".

The first proposal to build a non-public line from a coal deposit in Yakutia to the northwestern shore of the Udskaya Bay of the Sea of Okhotsk in the Khabarovsk Territory was publicly voiced in July 2021 at a meeting in the government of the Russian Federation, when negotiations were underway on the modernization of the Baikal-Amur Mainline. The initial plan, which was presented by the Ministry of Transport of the Russian Federation, assumed that construction work would start in 2023, and within five years the new railway would be put into operation. However, the Elsie coal company decided to speed up the pace of work, starting construction last year. It is planned that the first trains on the new railway route should begin running by the end of 2024.

It is not difficult to determine that the new route will connect two large industrial facilities. The first of them is the Elga coking coal deposit, production of which started in 2011. It is worth noting that the coal deposits in this section are of quite high quality, they are characterized by low sulfur and phosphorus content, its reserves exceed two billion tons. In 2020, production amounted to 7 million tons, work at the site is carried out on a rotational basis; for these purposes, in 2011, not far from the field, the working village of Elga was created, which will include five residential microdistricts for the comfortable living of three thousand people. The second is the port of Elga, which is currently under construction. It is expected that in 2024 the new terminal will be able to handle 5 million tons of coal per year, and by 2025 the port will have to ship 30 million tons. The head of the Khabarovsk Territory, Mikhail Degtyarev, previously stated that the new port would take fifth place in the Russian Federation in terms of coal transshipment volume. The terminal will include five berths, some of them will be capable of receiving ships with a deadweight of up to 55 thousand tons, and ships with a deadweight of up to 85 thousand tons will be able to moor at some of the berths.

After completion of construction work, the length of the Pacific Railway will be 531 kilometers, and taking into account sidings and stations - 626. Previously, many experts called the project unrealistic due to the complexity of construction in difficult geographical conditions (taiga and deserted areas). In August 2023, it was announced that 200 kilometers of track would be laid. Thus, on the side of the Elga coal deposit, it was possible to lay 140 kilometers, and on the side of Cape Manorsky in the Khabarovsk Territory - 60. Also, do not forget that the new railway route will include the construction of several bridges. To date, the construction of three of the most complex bridge structures from an engineering point of view has been completed. The cost of construction of the Pacific Railway is estimated at 146,6 billion rubles. All funds will be taken from private sources, the payback period will be seven years. Four major contractors are taking part in the project: Rudtech, Modern Mining Technology", "SibGTK" and "Techweb".

It is also necessary to say a few words about the Elsie company, which will own the new railway. The company's key assets are located in the east of the Russian Federation. Based on their geographical location, it is easy to assume that the company’s main sales markets are in the countries of the Asia-Pacific region (People’s Republic of China and India), which is especially important in the current geopolitical conditions. The ultimate beneficiaries of ELSI are businessman Albert Avdolyan (80%) and general director of the coal holding Alexander Isaev (he owns 20% through EnergoGroup LLC).

New geo-economic realities have led to the fact that stable supplies of resources in the eastern direction have become one of the key goals of many Russian companies, and ELSI is no exception. At the moment, achieving results directly depends on how quickly the Pacific Railway construction project can be implemented. Therefore, despite all the climatic and economic difficulties, the company is doing everything possible to put the new railway route into operation by 2024.

In addition, I would like to separately emphasize that there is a huge need for the construction of railway tracks throughout the Russian Federation. Stations and stages that have not been reconstructed for a long time no longer have the capacity that will ensure the turnover and cargo turnover necessary for our country in the context of the transformation of many logistics routes. In this situation, the emergence of private railways should be one of the ways to speed up the pace of construction of new routes.

The main advantages of building private railways include the following factors:

– representatives of the business community are often much more effective than government authorities in monitoring the use of funds, since we are talking about personal capital. This technique largely eliminates the risks associated with the fact that the project will not be brought to its logical conclusion;

– the private sector reacts much more competently to changes in market conditions. For the sake of personal interests, companies are forced to regularly monitor all economic processes. We are talking about fluctuations in prices for various types of resources, transformation of export conditions and administrative innovations. Quite often, government projects simply begin to fail to keep up with market conditions, which reduces the profitability of emerging projects in the future;

– with the emergence of a developed and extensive system of private railways in Russia, it will be possible to resolve the issue of the monopolistic nature of pricing for the use of exclusive transport infrastructure, which will make it possible to give a more market-oriented nature to railway transportation within the country.

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unc-2

0

27 September 2023 11: 24

You can, of course, be happy for the Chinese and Indians, who will receive our raw materials and process them into something useful.
Vitaly-Rodaslav MK

+1

27 September 2023 11: 30

But who will serve it? After all, there are not enough track workers and contracting teams consisting of workers from the Asian former republics do not work very well, I personally worked as a track fitter and I know how these teams work, they were only used to fasten and loosen bolts and then had to be tightened after them. And after construction and start-up, it will be necessary to measure the track width and gaps, carry out flaw detection inspections, and here again there is not enough staff to become flaw detectors, and few people work as flaw detectors. And all these contract teams, if there is at least one specialist there who has worked in this field for at least a year, or better yet, more then Fine
strange guest

-1

27 September 2023 17: 20

Let them build. If they build it, we’ll nationalize it) The hardware won’t be taken away)
1. Viktor Anufriev
  
  +1
  
  27 September 2023 18: 30
  
  It’s a good idea, they’ll come to you to nationalize your apartment, I’ll also say, let them do it.
  1. strange guest
    
    -1
    
    27 September 2023 19: 33
    
    I am for a social state. The collapse of capitalism is inevitable.
    1. Viktor Anufriev
      
      +1
      
      27 September 2023 19: 46
      
      Your right, it will be interesting to see what you will say when the state comes to nationalize your property.
      1. strange guest
        
        -1
        
        27 September 2023 20: 12
        
        If the country needs it, I will survive.
      2. prior
        
        -2
        
        30 September 2023 12: 14
        
        Author, how much were you paid for such a fierce defense of private property and privatization?
        Which industry has benefited from its existence? In the aircraft industry, in space, in electronics, in the automotive industry....? Where?
        Haven't they destroyed and plundered enough yet?
        Oligarchs are not all of Russia.
        If the state comes to nationalize my apartment, which I received from the USSR, then this state is a criminal.
        We can talk about nationalization only about means of production that use wage labor.
        Stop monetizing everything and everyone. There are other values besides money.
        Privatization is a direct path to either tyranny or civil war, which is exactly what is happening in Ukraine. Slavs kill Slavs, Russians kill Russians.
        For whose interests?
        
        Viktor Anufriev
        
        +2
        
        1 October 2023 10: 49
        
        I was paid 0 rubles for protecting private property.
        I just went to school and I know that private property is the basis of the foundations.
        Private property gives rise to competition, and competition leads to development.
        There will be two public toilets in front of you, one is public and the other is private. Which one will you go to? Of course, in a private one, because the service there is better (it won’t stink and will be cleaned).
        And why? Because the profit of the toilet owner depends on it and he strives to provide a quality service.
        And the fact that in Russia many industries rolled back after the collapse of the Soviet Union is not a problem of the market economy and private property, but a problem of swindlers and thieves.
        Which just grew out of the Soviet Union, where taking something state-owned from the factory was considered the sacred duty of every worker.