‘The project on the industrial development of the northern parts of the Urals (known as The Industrial Urals-The Polar Urals) is the grandest territory development project since the Soviet times; it could actually yield some very impressive economic and political returns. The implementation of this project, though, is associated with a number of certain difficulties,’ Finam’s Konstantin Romanov said to UrBC.

Mr. Romanov believes one of the problems facing the project coordinators is the need to look for some private investors who would contribute at least 25% of the total sum to the project.

‘Potential investors are normally quite reserved in terms of both assessing the potential of this project and actually taking part in it. This probably has to do with things like the unpredictability of the exploration process and lack of verified data on the actual amount of undiscovered resources within the given area. Most of the deposits located in the northern parts of the Urals pertain to the undiscovered resources category, which means the theoretical data we have on the profitability of this project have not been practically confirmed as of yet. And this, in its turn, means we cannot come up with any figures as to the economic expediency of this project. It’s true that a number of companies (Gazprom, to name just one), fully support this project, but this is happening because they can directly benefit from it from the very beginning. As for many other potential investors, the return on investments they might or might not get is, in fact, something one needs to question,’ Mr. Romanov observes.

He also comments on the expenses one needs to bear now and on the future pay-off:

‘It goes without saying that the project needs some thorough further elaboration, with all the figures on the profitability of constructing the transport links. Otherwise, we might end up with a second BAM (Baikal-Amur Mainline) that actually turned into an unused thoroughfare. What should be discussed is how to most efficiently use the allocated finances in order to avoid the mistakes of the Soviet times. In my view, the implementation of the project should only begin after all the data on its profitability have been verified. If this never happens, not only will this cost us all a lot of money, but it will also distort the region’s fragile biological equilibrium that will be extremely hard to restore,’ Mr. Romanov warns.

Kommersant Ural’s press center hosted a debate devoted to the possible doubts raised by the future of the project on August 29, 2007. Some representatives of the Ural Branch of the Russian Academy of Sciences and a number of other experts spoke very bitterly about both the project coordinators and the project itself.