Innovation and digital technology

Contribution to the UN SDGs

Nornickel extensively relies on innovative solutions such as artificial intelligence and machine learning at all stages of its production process, from exploration to smelting, while fostering an overall culture of innovative transformation and digital literacy among its employees. The use of technology streamlines operating processes while also making production safer both for employees and the environment.

However, technological innovation at Nornickel is not only about research, development and rollout of promising technologies and solutions but also about building the Company’s proprietary R&D platform and research centres, shaping internal policies and fostering a culture of high-tech developments.

Nornickel is also progressing initiatives to manufacture production-critical components for its core operations as part of embedding computer modelling and 3D printing into its processes. For this purpose, the Company has set up a platform featuring available scanning, design, modelling, and prototyping technologies which already enable Nornickel to efficiently jump-start component manufacturing. The Company has used 3D printing to reproduce the full cycle of manufacturing pilot components. These solutions enable the Company to significantly expand its capacity to manufacture in-house more items required by its enterprises.

Nornickel’s uniform approach to managing its intellectual property greatly contributes to driving its innovative growth and building a competitive portfolio of R&D assets.

The Company’s coordination centre responsible for managing its intellectual property registers exclusive patent rights and copyrights both in Russia and abroad.

As at 1 January 2023, the Company owned the intellectual property rights in the following items registered in Russia:

  • 18 inventions
  • Four utility models
  • Four software applications
  • 18 trademarks

Moreover, the invention patent for the method for continuously converting nickel-containing copper sulphide materials, which underlay the continuous conversion project at Copper Plant, has been registered in the USA, Kazakhstan, China, Canada, Finland, Sweden, and Chile.

Technology Breakthrough 2.0

Since 2015, Nornickel has been running its Technology Breakthrough programme, focused on building an automated operational control system and improving labour productivity and safety, including by integrating advanced information support and automation tools into its production processes.

In 2019, all previous results from the Technology Breakthrough programme were analysed to transform it into the Technology Breakthrough 2.0 project portfolio, with its initiatives more focused on ensuring operational continuity, securing technological independence and achieving operational safety and environmental goals.

Automation of the Glubokaya mine (Skalisty Mine)

Human presence in the mine needs to be minimised given its challenging mining conditions (mining depth over 2 km, temperature of +46 °C, high pressure).

Offsetting the projected decline in the automation level, which was maintained at 50% instead of a drop from 80% to 20% expected by now.

Confirmed automation of five core processes:

  • Crushing
  • Skip hoisting
  • Rock conveyor delivery
  • Drainage
  • Ventilation

Backfilling can be automated by 70%: this requires manual installation of backfill bulkheads and adjustments to shutoff gates and switches at branched workings.

Five areas do not currently lend themselves to autonomous or remote control and require human presence:

  • Drilling and blasting
  • Supporting
  • Rock haul by self-propelled diesel equipment
  • Rock pressure control
  • Mine surveying

Further development of a domestic geological and mining information system is ongoing. Once adopted by the Company, the product has proved highly effective, enabling Nornickel to update its mineral resource base and streamline its mining plans.

Further improvements are continuously made to simulation modelling, dispatch and mining management systems, with an emphasis on verifying and tracking production targets, boosting the equipment utilisation rate, and so on.

The Company has made further progress on its ambitious project to minimise human presence in deep mines. Currently, Nornickel is exploring the concept of autonomous and automated mining processes at the Glubokaya mine (part of the Skalisty Mine) leveraging forward-looking technical solutions that can minimise human presence in underground workings.

During 2022, the Company improved the quality of its finished products by:

  • changing the topology of the circuit for zinc recovery from leaching solutions
  • changing the topology of cobalt and lead recovery circuits
  • adopting abrasive material with a reduced content of impurities
  • improving the performance of the extraction cascade within the zinc recovery process (from 43 m³/h to 53–55 m³/h)
  • improving raffinate precipitation after zinc recovery
  • improving the performance of the circuit for raffinate neutralisation after zinc recovery.

These improvements have reduced the content of copper, iron and lead impurities in Nornikel’s nickel cathodes by 9% year-on-year for copper, 12% year-on-year for iron and by over 30% year-on-year for lead.

Industrial safety technology

Video analytics

To improve safety culture at its operations, Nornickel is actively adopting solutions that use AI-enabled video analytics.

The Company’s proprietary solution to monitor the use of personal protective equipment by operational staff was further improved in 2022. New safety incident detection models were, detecting open fire, etc.). The solution was integrated with personnel tracking and face recognition modules to monitor compliance with safety rules.

In particular, the Company is planning to leverage video analytics to detect four out of the six safety violations with the highest risk of injury listed in Nornickel’s golden rules:

  • Working at height without a safety harness
  • Moving loads with people under a suspended load or dangerously close to the load
  • Employees staying near unfenced rotating (moving) machinery or equipment components
  • Transferring people in vehicles not designed for these purposes

In 2022, the Norilsk Division launched pilot tests of a video analytics system at its industrial facilities. As part of this project, server infrastructure was deployed and mock violations of industrial safety rules were staged for a quality test of machine learning algorithms.

Plans for 2023 include looking into the potential use of computer vision at construction sites to monitor compliance with industrial safety rules by contractors. Nornickel also plans to continue pilot testing and implementation of other solutions based on video analytics (assessment of discharge turbidity, identification of cathode grades on the cutting line, monitoring for oversized ore pieces, etc.) at the production facilities of the Norilsk Division, following which the accuracy of the algorithms and their impacts will be assessed.

In 2022, Nornickel teamed up with the Federal Environmental, Industrial and Nuclear Supervision Service of Russia (Rostechnadzor) to set up an experiment to deploy a remote industrial safety compliance monitoring system. The system was piloted at Kola MMC and provided continuous risk-based supervision, monitored compliance with the requirements for operating conditions and the actual status of industrial safety at hazardous production facilities, analysed the current situation at hazardous production facilities predicted potential adverse events, and transmitted information to automated information system of Rostechnadzor.

Emergency monitoring

The Company has stood up an information and diagnostic system in its Norilsk Division to detect and prevent negative trends and emergencies. A large-scale building and structure monitoring system has been created to consolidate data on the condition of soil, bearing elements of buildings, satellite monitoring data, and data from predictive models. The resulting insights inform the Company’s proactive initiatives to prevent climate change impact. In 2022, the project won gold at the ComNews Awards and silver at the MineDigital competition held as part of the 18th MINEX Russia Mining & Exploration Forum.

Green technology and ESG

Environmental monitoring

Environmental monitoring of water bodies is part of StikhiyaEco, the corporate environmental protection and monitoring system.

Tools for environmental monitoring of water bodies enable online tracking of changes in metrics over time to prepare mitigation measures

Environmental monitoring

  • Monitor the environment by aspect: air, climate, water, soils, tailings
  • and waste, biodiversity, emergency preparedness

Related projects:

  • Project to install an automated control system covering emission sources at Nadezhda Metallurgical Plant
  • Digital Plant (Nadezhda Metallurgical Plant): digital mock up. Environmental monitoring. Prototype
  • Development of a predictive emission monitoring system (PEMS)
  • Implementation of an environmental tracking system (ETS)
  • Smart City: piloting an air quality monitoring system in Norilsk
  • Air quality monitoring in Monchegorsk, Nikel and Zapolyarny

Data visualisation panels (dashboards)

  • Operational data by aspect: air, climate, water, soils, tailings and waste, biodiversity, incidents
  • Environmental performance by aspect

Data records

  • Registers and records of facilities with negative environmental impacts
  • Registers and archives of permits and licences
  • Registers of waste storage facilities
  • Data sheets of metering and other equipment

Environmental planning and management

  • Predict above limit levels of environmental impacts
  • Submit data to supervisory bodies

Report generation

  • Operational and statistical reports on environmental performance
  • Paid use of natural resources (calculate environmental fees, environmental tax, water use fees)

Tracking environmental indicators

  • Sulphur emissions
  • Carbon footprint
  • Oil spills
  • Remediation of legacy pollution
  • Clean-ups and other activities

The Company is implementing automation projects in ecology / environmental protection.

For example, an environmental water drone has been successfully piloted to speed up the tracking of performance against targets over time.

Tools for environmental monitoring of water bodies enable online tracking of changes in metrics over time to prepare mitigation measures

Environmental monitoring of water bodies is part of StikhiyaEco, the corporate environmental protection and monitoring system.

Another tech-enabled initiative within our ESG agenda was the development of a prototype of an environmental monitoring system at Nadezhda Metallurgical Plant based on a digital twin. The pilot will be the first step towards creating an integrated information and analytics platform relying on a uniform methodology for calculating environmental (air, water and soil) impacts. The system will be capable of interpreting and verifying the data obtained, generating forecasts and reports as well as performing mathematical and simulation modelling of environmental processes.

An automated pollutant emissions monitoring system has been piloted at Copper Plant. The pilot solution will allow Nornickel to evaluate the potential for using Russian equipment, taking into account the Company’s process and production profiles.

In 2023, Nornickel will also start developing a mathematical model of industrial emissions, with the relevant software suite expected to become an alternative to expensive and complicated instrumentation to monitor emissions. The development of this information system has been supported by an industrial competence centre. Going forward, this product is also planned to be offered to third-party industrial enterprises. As part of the engagement with industrial competence centres, amendments are also being made to the existing regulatory framework.

Completed activities
  • Tested an environmental water drone
  • Analysed the correctness of collected data
  • Exploring potential data transmission to a digital plant to build a prototype
Mine water treatment

Mine water treatment

A pilot test project was launched in 2022 to treat mine waters at the Komsomolsky Mine. The pilot also included parallel operation of several mine water treatment plants using reverse osmosis and electrodialysis to bring water quality to the standards required by Russian laws. Conducting tests in this format helps us understand which technology performs better given the biochemical profile of mine waters at the Komsomolsky Mine.

A pilot test plan has been approved, with the pilot slated for completion in 2023. The pilot’s results will inform the preparations for the Komsomolsky Mine development project and help make the optimal decision when selecting the best mine water treatment technology.

High-tech materials

Metals produced by Nornickel are currently central to high-tech manufacturing. In 2022, the Company produced its first physical samples of innovative high-tech materials (powders, alloys, catalysts) which can potentially boost its product margins several times over. New palladium-containing catalytic products (hydrogen separation and purification membranes) offers the potential to expand palladium sales and build value chains from palladium production to vehicle fuel batteries. Pilot tests are ongoing as part of an experimental battery unit.

The Kola Division continues exploring technical and design solutions for the manufacturing of new types of saleable products: premium quality nickel cathodes for electroplating and superalloys, as well as rondelles.

Modified sulphur

The Company has tested an innovative technology for producing modified sulphur, which could become a promising feedstock for the construction industry. Work is underway to produce pilot samples of asphalt featuring modified sulphur instead of BND 100/130 grade bitumen. Asphalt pilot samples have been produced to confirm that the asphalt concrete mixtures meet the requirements for operation in the Far North, with the production of a pilot batch of sulphur-extended asphalt and sulphur concrete being set up at the asphalt concrete plant in Norilsk. The project’s potential throughput capacity is 30 ktpa of sulphur. Up to 20 ktpa of modified sulphur are planned to be additionally used in the production of reinforced concrete products to beautify the city.

Gangue mineralisation

The Company is exploring the ability of waste from concentration of polymetallic ores to absorb CO2 from the atmosphere. Gangue mineralisation is a natural process, but no prior research has been conducted into using gangue from ore concentration to reduce carbon footprint. Solutions involving artificial waste mineralisation are being developed in parallel. Accelerated mineralisation is being tested as part of the pilot project. The new technology may also find application at Nornickel’s assets.

Tech-enabled construction

Construction management platform

Nornickel is testing a platform that provides a common data environment based on a Building Information Model (BIM) to connect all construction process stakeholders and drive end-to-end digitalisation of capital construction projects throughout their life cycles. The platform ensures comprehensive monitoring of construction project timelines and budgets. Competitive pilot tests were conducted in 2022 on capital construction projects of various types (social infrastructure and residential facilities) at all stages of their life cycles. The Company tested the functionalities of products offered by different vendors. In 2023, the Company is planning to digitise construction monitoring and test additional features of vendor products via pilot projects.

The platform’s value proposition
  1. Process acceleration through:
    • end-to-end digitisation of the construction process
    • access for all stakeholders to a single source of truth for data
  2. Addressing potential errors by

    preventing conflicts and using BIM models

  3. Timely identification of variances in the construction process through

    specialist services embedded into the process

Laser scanning based analytics

The tool increases the speed and accuracy of detecting deviations in construction and installation.

STEP 1. The customer collects data using LIDAR and transmits the information to the vendor’s cloud-based platform.

STEP 2. Information is processed and compared by machine vision and AI-based tools against the BIM project parameters and work schedule.

STEP 3. An analytical report is prepared regarding the quality (compliance with geometric parameters) and work progress.

The solution helps improve work quality and accelerate timelines while tracking and visualising construction progress as well as improving communication between project stakeholders.

In 2022, the first pilot phase was completed under a project to construct a church complex of the Russian Orthodox Church in Norilsk, with the pilot construction of a residential building launched as part of the Norilsk renovation programme. In 2023, Nornickel is planning to roll out the technology in residential construction as well as at the Company’s industrial facilities to confirm its economic and non-financial impacts across different types of projects and different construction stages.

UAV-enabled monitoring

UAV-enabled analytics is used to build a regularly updated 3D model of the construction project, enabling better monitoring of progress on groundworks and improving communication between project stakeholders.

In 2022, a pilot was launched to validate the value proposition of the software for UAV data analysis conducted as part of groundworks for the surface backfilling preparation complex at the Mayak Mine.

Unmanned aerial vehicle
Technology in operations

Concentration optimisation

A pre-feasibility study was conducted, and the potential technical impact was calculated in 2022 for the introduction of an intelligent automated process control system for disseminated ore flotation to improve operational performance of Norilsk Concentrator. In 2023, the Company is planning to create a prototype of this assistant system, first in an automated version and then in an automatic version, with the system to be eventually rolled out if the study results are validated.

A prototype assistant using statistical data was developed in 2022 for the copper flotation circuit of Norilsk Concentrator. The system currently runs in an automated mode across normal operating modes of the production process. The assistant’s algorithms for emergency operation are also being described and prepared for testing for the subsequent automatic operation and rollout of the system. In parallel with the prototyping of these assistants on the copper and disseminated ore circuits, Norilsk Concentrator, in particular its flotation line, is being retrofitted with sensors and process data collection equipment to boost the assistants’ performance and step up the overall performance and process effectiveness.

Industrial tests of a pilot pneumatic flotation cell were also carried out at Norilsk Concentrator. Data were obtained to support the case for retrofitting of scavenging facilities at Norilsk Concentrator using impellerless pneumatic flotation cells.

Among other things, Nornickel is planning to draft an operating procedure in 2023 for the processing of disseminated and cuprous ores at Norilsk Concentrator’s upgrade project (NOF-2) based on a relevant ore dressability study. The resulting operating procedure will be used to design NOF-2.

Since 2019, a number of projects have been ongoing across Talnakh Concentrator’s value chain to digitise production processes for increased productivity and improved recovery of precious metals. These projects include process cruise control systems for process engineers as well as machine vision sensors used across the process stages. A digital granulometer has already come online, and a nickel flotation optimisation system and a low-nickel pyrrhotite flotation optimisation system were successfully piloted. Going forward, Nornickel plans to scale up these optimisation systems to the entire flotation capacity and test the flotation froth control systems in real time.

Converting optimisation

A converting monitoring system is planned to be developed in order to boost the recovery of non-ferrous metals from converter matte. The experiment will involve determining the correlation between iron content of converter matte and the colour of the converter’s off-gas flame using optical analysis tools. This will help increase the average iron content in converter matte and boost the recovery of non-ferrous metals such as nickel, cobalt and copper leveraging iron’s shielding properties during matte converting. The system will operate remotely in real time. Material balance calculations carried out by Gipronickel Institute corroborate the potential impact from its adoption. Initially, the system will learn how to determine iron content by analysing the off-gas flame spectrum. When the target state is reached, the system will be able to prompt the operator about the optimal time to complete the converting based on the composition of off-gases as determined by an analysis of their flame spectrum.

In 1H 2023, Nornickel is planning to create a prototype for one converter of Nadezhda Metallurgical Plant. If proven effective, the solution will be rolled out to the plant’s other converters, and its use in the converter operations of Copper Plant will also be considered.

Hydrocyclone control optimisation

The development of an assistant system to optimise hydrocyclone control at the Trans-Baikal Division’s concentrator was launched in 2022. Hydrocyclone control is essentially about stabilising a set pressure by controlling the pump operation rate, about keeping density within a set range by controlling the water flow rate in the sump subject to relevant restrictions, and about adjusting the feed density by opening/closing cyclones when the sump level limits are reached. Optimising hydrocyclone operating modes will stabilise the proportion of the material meeting target parameters and, consequently, boost copper recovery into copper concentrate.

The Company has developed a pump hydrocyclone control concept, evaluated the potential impact from the solution’s implementation using historical data and drafted a prototyping plan. By mid-2023, Nornickel is planning to test the model, make preliminary impact estimates and prototype the solution in real-life industrial settings.

Milling optimisation

In 2021, a diagnostic was run on Bystrinsky GOK, resulting in a decision to apply optimisation algorithms to boost the milling circuit’s performance. The key hypothesis behind the project was that a digital assistant would boost the autogenous mill’s throughput. As part of Step 1, Company specialists analysed historical data and developed a control algorithm for the autogenous mill to confirm this hypothesis. Once the hypothesis was verified using the site’s historical data, it was decided to prototype with real data. The test results have confirmed the key hypothesis, with the solution boosting the mill’s throughput. Preparations are underway for a review by the investment committee, which will decide on whether to allocate funds for the project. The Company’s objective for 1H 2023 is to start moving the solution to the commercial launch stage.

In order to improve the semi-autogenous mill’s throughput, an AI-based assistant was developed, adjusted and tested at Talnakh Concentrator in 2022. The tests have confirmed that the system is applicable and delivers a performance impact. Plans for 2023 include testing a feeder control system for the semi-autogenous mill in automatic mode and moving the finished assistant prototype to fully automatic operation. The mill is also expected to be retrofitted with sound sensors to ensure more accurate modelling and build the mill’s DEM model. These improvements will enable more data feeds from in-mill processes while unlocking control of the milling process and extending the mill liner lifetime.Discrete element method.

Monitoring tailings storage facilities and flue-gas stacks

Starting from 2022, Talnakh Concentrator and Nadezhda Metallurgical Plant have been testing a platform to analyse UAV data. As part of this initiative, pilots were conducted to monitor the operation of Talnakh Concentrator’s tailings storage facility and flue-gas stacks of Nadezhda Metallurgical Plant.

The tests at the tailings storage facility included:

  • monitoring changes in the condition of dams and hydraulic structures over time
  • visualising the liquid tailings inflow distribution
  • estimating the area covered by solid tailings.

The tests at flue-gas stacks included:

  • detecting cracks in the protective layer of concrete
  • evaluating the condition of service platforms, ladders, stack tips, and signal lights
  • evaluating the condition of stack’s metal structures and portals.

The tests have confirmed the product’s functionality and provided preliminary estimates of its economic and non-financial impacts. Going forward, the Company is planning to launch a second testing phase to confirm the product’s value proposition in harsher winter conditions. Moreover, the second phase will involve testing the technology on new types of the Company’s assets (power lines and pipelines) and completing the calculations of economic and non-financial impacts from the technology rollout across all facilities.

Lowering magnesium content in concentrate

The initiative to lower magnesium content in concentrate run at the Kola Division is important to the Company since higher magnesium content translates to a potentially lower price of finished products. The project bets on automated on-stream analysis of gangue sample mineral composition to improve separation of magnesium-bearing minerals from ore and enable predictive adjustments to the concentration process. A comprehensive characterisation of minerals and their phases in all ores mined by the Kola Division was conducted in 2022 using advanced 3D microscopy and digital core analysis methods. Recommendations were drafted for a range of laboratory studies to streamline existing concentration processes, planned to be completed in 1H 2023. The laboratory studies will support subsequent pilot tests to trial the highest-potential solution for improving the sulphide concentrate production process.

Producing high-grade nickel cathodes

An initiative was launched to produce higher grade nickel cathodes by reducing the impact of zinc-emitting sources. The initiative will identify key zinc emission sources and provide recommendations on reducing and stabilising their impact on the quality of nickel cathodes.

LIDAR scanner

The Company has adopted mobile LIDAR scanners to survey mining operations across all of its mines.

LIDAR scanning is the most effective method of sourcing digital models for underground workings and the ground surface. It performs high-precision surveys of mine workings in motion in minutes, with 3D visualisation taking place in real time. An accurate high-res digital model of the scanned location is obtained through instant processing of laser beam reflections. A scanning range of up to 200 m can be achieved underground, at a rate of 300 thousand measurements per second.

LIDAR scanning systems allow Nornickel to conduct more than 1.5 thousand surveys per year, covering over 40 km of mine workings. Most importantly, these scanners ensure more accurate geometric measurement of underground workings, including stopes. This level of accuracy helps mine managers to make faster and better decisions on how to proceed with their mining operations.

Research and development

R&D is a major driver behind the implementation of the Company’s strategic priorities. The Company’s key strategic priorities include driving fundamental improvements in environmental protection, developing and implementing projects to upgrade existing and construct new production facilities so as to increase output and supply of key metals to the global market as well as maintaining the Company’s financial stability as its major investment projects are brought online. Gipronickel Institute, which is part of the Group, is Nornickel’s core R&D platform. It is one of Russia’s largest research and design centres for mining, concentration and metallurgy.

Digital projects

Technological advancements are the most essential tool used to improve Nornickel’s business processes and workplace safety. Despite the geopolitical risks and external challenges of 2022, the Company continued its digital projects while taking steps to maintain business continuity.

The strategy previously adopted by Nornickel and its proactive management decisions helped the Company achieve strong IT stability amid unprecedented uncertainty and external pressure.

Technological independence

Gaining technological independence has become a new priority focus area in the Company’s IT strategy. Nornickel’s information systems have been isolated in advance, with additional equipment and spare parts purchased. An evaluation of the Company’s IT landscape for technological independence has demonstrated that 18% of its systems (barring the process control system, PCS) use imported software, while one third of these systems require additional measures, including renewal. The remaining systems can be operated without running any material risks for several years. The Company has developed criteria for ranking IT projects by impact of relevant restrictions. Key considerations include availability of Russian alternatives, in-house development capabilities, available purchased licenses, availability of updates, and technical support.

In 2022, the Company put a huge effort into securing technological independence in industrial automation. Imported process control systems make up 92% at the Company while 21% requires renewal in the nearest future. To reduce exposure to imported equipment, the Company has run a detailed analysis of alternative Russian-made equipment items and data collection and operational control systems, approving four primary Russian manufacturers of controllers and preparing scheduled PCS upgrade programmes for each of its divisions. A targeted programme has been developed and put in place to train Nornickel specialists in the new equipment. Dedicated testing laboratories and an expert centre are being set up to test solutions.

ICC Metallurgy will develop proprietary alternatives for critical mining tools, including a geological and mining information system, a mining planning system and an underground dispatch system ICC Ecology will create a digital twin to simulate industrial emissions leveraging PCS data.

Pursuing projects announced by Nornickel is a task of industry-wide significance that requires appropriate corporate procedures and implementation approaches; therefore, a separate legal entity, Norsoft, was established to ensure product development. The establishment of a dedicated legal entity focused on ICC projects was prompted by the need to apply a flexible product-based approach, streamline efforts to develop industry-specific solutions, ensure transparent management of project implementation and financing, register and exercise intellectual property rights, and conduct follow-up monitoring. Major companies in the Russian mining, metallurgical and chemical industries have shown interest in the products under development.

In 2022, Nornickel launched a new strategy to promote the uniformity of measurements, which includes an initiative aimed at import substitution and stronger technological independence. When searching for Russian alternatives, we selected over 360 manufacturers across 119 principal groups of measurement instruments. Their production capacities and the quality of their products meet the Company’s requirements. In particular, an alternative Russian-made nuclear density gauge, PR-1K, produced by ROSATOM was selected and tested in a real-life operational environment at the Medvezhy Ruchey site. The successful testing prompted the decision to run in-depth durability tests to build experience and test operational performance.

In addition, a Russian-made automated system for streamlining the work of metrological services (NERPA software) was piloted in 2022 with a view to building a single information environment to combine measurement standards, measurement instruments, testing equipment, and reference standards.

In order to improve digital literacy among employees who operate existing software and to reduce the risks associated with the adoption of new information systems and tools, the Company has successfully launched an educational ecosystem to meet current needs and promptly deliver training. In 2022, Nornickel’s in-house experts trained over 12 thousand employees in various software applications while almost 20 thousand employees were involved in digital literacy initiatives.

Digital financial assets

In 2022, Nornickel placed a pilot issue of digital financial assets (DFAs) on Atomyze, an open asset and process digitisation platform. The DFAs issued by the Company were dubbed New Money Market (NMM) and are set to become a promising financial product in short-term trade finance and highly liquid and reliable investments. These assets serve as Nornickel’s unconditional financial obligation to repay the funds to the investor (DFA holder) in such amount and on such date as determined by the offering documents. The NMM digital financial assets combine the advantages of traditional paper-based financial products such as factoring instruments and short-term bonds. As such, the DFAs represent Nornickel’s pure credit risk and rank among the best debt assets in Russia in terms of quality and reliability.

With this pilot project, Nornickel seeks to test the platform functionality and operating specifics when issuing and transacting in DFAs. If successful, the pilot project opens up broad prospects for scaling up the circulation of NMM DFAs and expanding the range of digital financial assets through new platform solutions and products for other needs of issuers and investors.

IT infrastructure continuity

In 2022, Nornickel teamed up with Russian infrastructure solutions market participants to carry out an ambitious testing programme for import-independent IT equipment for compliance with existing corporate standards and information security requirements as well as for compatibility with the current IT landscape.

Nornickel has launched a large-scale initiative to pilot and phase in a multifunctional Linux-based infrastructure solution into its corporate environment. The transition to Linux infrastructure will imply a particular emphasis on corporate business processes and users.

A programme to build backup computing capacity in key corporate data centres has been completed. This move will reduce the potential negative impact on the continuity of IT services caused by the shortages of equipment and components following the withdrawal of foreign manufacturers from the Russian market.

The Company continues to implement data centre development projects. The construction of a new data centre in Moscow in cooperation with IXcellerate was completed in 2022, and functional systems to support IT equipment were put into operation. Land plots for the construction of new data centres in Monchegorsk and Norilsk have been found and selected.

The Company has launched a new wave of the programme to upgrade service facilities that are critical for its production systems. Based on lessons learned, the relevant corporate standard has been updated with requirements for the creation and operation of the relevant class of physical infrastructure.

The Data Lake platform

Technology-wise, mining production of base metals is one of the most challenging industries. The journey from ore mining to selling the finished product involves collecting terabytes of data that must be processed to boost plant productivity and make work more comfortable. To collect and process big data across production sites and embed best practices, the Company has put in place a project to create a Data Lake digital platform. The Data Lake is essentially a technologically advanced platform that leverages big data, artificial intelligence and machine learning to address business tasks.

In 2022, infrastructures to launch several business initiatives leveraging artificial intelligence and machine learning (including a containerisation platform) were developed based on the Data Lake. For example, a prototype was launched for a prediction algorithm to control the dissolution and filtration processes in the nickel tankhouse at Kola MMC (on one of the four dissolution units). The system is comprised of machine-learning models that receive input data using several dozens of data tags in near real time and display resulting insights on dashboards across dedicated screens in the control room. The prototype’s early results were evaluated in the first quarter of 2023. Going forward, we plan to roll out a series of solutions leveraging machine learning to the other three dissolution units.

At the same time, as part of the programme to gain technological independence, we initiated migration of the data platform from foreign to Russian-made software. To date, three of the four project phases have been completed. We expect that new Russian-made software will be used to support the platform development strategy, in particular, to design the Data Lake’s geo-distributed infrastructure.

In addition, a dedicated platform is being set up to develop solutions leveraging machine learning. The platform helps address tasks such as data discovery, model development and launch of applications leveraging machine learning and runs on a high-performance cluster.

Developing communications networks

The Company continues its programme to develop service data networks. In 2022, the construction of a high-performance service network at the production sites of the Polar Division was completed; similar projects were initiated at Kola MMC and NTEC. To implement unmanned mine and remote equipment control technologies, communications networks must meet tough bandwidth and data speed requirements. With this in mind, the Company partnered with a number of Russian manufacturers of telecommunications equipment to initiate in 2022 the development of a switch with enhanced performance to be subsequently used in mines. By mid-2023, we expect to complete testing of selected developments. Delivering both enhanced performance and stronger security is a challenging task for developer teams; once implemented, this solution will not only cover the existing needs but also accommodate future growth in data traffic from production automation.

High-speed internet in the Norilsk Industrial District

Given that mobile and fixed-line connectivity remains a key prerequisite for high quality of life in the modern world while driving the growth of digital services, Nornickel launched the construction of a 956-km Novy Urengoy–Norilsk fibre-optic line back in 2017.

The project seeks to cover the Company’s production-driven demand for high-speed connectivity and improve the quality of life in the Norilsk Industrial District by offering broadband internet access, enhancing the quality of services, including public ones, and expanding the range of communications services.

High-speed data services are available in the Norilsk Industrial District as well as in communities along the fibre-optic line route since 2017. An in-house maintenance service has been set up to service the communications line, comprising a call centre, a single network management centre and highly skilled field teams experienced in working in a similar environment and set up with specialist equipment and a fleet of custom-built all-terrain vehicles.

For more reliable operation, the capacity of the existing backup communications line across the Yenisei River was expanded from 1 to 40 Gbps and stabilised. The new line will both expand the total radio bandwidth and reduce the impact of weather conditions on data speed.

Work is ongoing on backing up the existing communications line between Novy Urengoy and Norilsk. The project is carried out by an approximately 200-strong construction and installation team set up specifically for this purpose, with a dedicated fleet of construction equipment. These efforts, including measures to enhance the line’s reliability, have ensured an SLAService Level Agreement. of at least 97%, with emergency recovery within 72 hours.

To improve connectivity given the growing demand for data services from the Norilsk Industrial District’s residents, the Company has expanded the backhaul network’s bandwidth from 40 to 200 Gbps, enabling an increase of up to 85 Gbps for data traffic passing through client communications channels, while the Company’s own traffic requires less than 1% of this capacity.

City Online

City Online is a project aimed to improve the quality of life of people living in small and medium-sized towns in the Far North and the Far East by providing infrastructure and digital services in various areas of life and making habitual services more accessible in remote areas.

In line with advanced trends, the City Online business model offers integrated solutions and promotes digital social services combined into ecosystems/platforms.

Its key solution comprises an integration platform and a range of integrated B2C, B2B and B2G services selected from existing market products based on a needs analysis of cities. The platform is an entry-level product and a key element in the Company’s positioning in the Smart City market.

The platform is available bothonline and as a mobile app in five cities: Norilsk, Dudinka, Monchegorsk, Murmansk, and Krasnoyarsk. The number of registered users exceeds 180 thousand, with almost 1.5 million unique visitors. The mobile app has been installed about 55 thousand times. The platform enjoys positive user feedback as shown by surveys and regular Net Promoter Score assessments.

The web and mobile versions of the platform currently offer 28 and 16 services, respectively. The most popular services are GO.Media, Playbill, Broadcasts (available only in the web version), Map, and Transport.

Services that support seamless interaction of municipal employees with each other and with local residents within a shared information space will be further enhanced. More effective city management decisions will be enabled by leveraging real data, including through infrastructure products represented by hardware and software solutions for the automation of municipal infrastructure.

Examples of infrastructure services implemented as part of City Online include an air quality monitoring programme and a predictive environmental assessment model covering Norilsk, Monchegorsk, Nikel, and Zapolyarny and seeking to improve the urban environment and the quality of life as well as a mobile-based school education system introduced in the Murmansk Region in 2022, offering improved and socially inclusive education and minimising the impact of weather-related school cancellations.

Enhancing corporate business processes

Key focus areas of Nornickel’s digitalisation efforts include the continued automation and development of core processes within the corporate ERPEnterprise Resource Planning. It is a business process management software solution that is used to integrate and manage finance, supply chains, operations, trading, reporting, production, and human resources. template.

Currently, all key financially significant Group enterprises are already included into the unified business template and relevant automation systems such as the supplier relationship management (SRM) system and warehouse logistics management system, with the groundwork laid to further increase the maturity of related business processes and improve their operational efficiency.

The corporate template covers over 50% of the Company’s core business processes, with the centralised platform encompassing 37 enterprises engaged in different areas (core and auxiliary operations, sales, supply and logistics, construction, energy, services, and project management). The system supports business functions and interaction for more than 15 thousand users while ensuring integration with 40 related automation systems that make part of the corporate architecture.

To ensure independence from imported ERP solutions, the Company works on migrating to a composite ERP architecture.

Warehouse operations are improved via projects that automate warehouse logistics management. As part of these efforts, Nornickel has launched a specialist system at the warehouses of Kola MMC and the Polar Division, which can be rolled out to other corporate assets, while its functionality related to cargo management at ports and logistics within divisions can also be expanded.