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 KAZAKHSTAN International Business Magazine №1, 2012
 Space Altitudes of a Titanic Giant
Space Altitudes of a Titanic Giant

The Ust-Kamenogorsk titanium and magnesium plant (UKTMP) can be called by right the proud of the mining and metallurgy sector of independent Kazakhstan. The share of output by the UKTMP in the world’s titanium production is 14 %. The enterprise provides more than 17 % of the demand for this metal by the international aerospace sector. 

At the beginning of a long path

The glorious history of the Ust-Kamenogorsk titanium and magnesium plant counts for more than 45 years. Built with the application of up-to-date research and technical developments and also experience of other advanced enterprises in the USSR, the plant was put into operation on March 27, 1965. The place for its construction was selected not by chance. In the first place, Ust-Kamenogorsk was a large mining and metallurgy center that could provide the UKTMP with highly-skilled specialists working in non-ferrous metallurgy. The second thing is that the cascade of the hydroelectric power stations at the Irtysh River provided the plant with cheap electric power. In 1969 the UKTMP reached the design capacity, and later in 1971 the expansion and modernization of it started. The plant was designed and then was operating in close interaction with the other Soviet enterprises. Carnallite produced at the Bereznikovsky titanium and magnesium plant was used as a raw material for the magnesium production. The UKTMP was provided with titanium slag owing to supplies from the Zaporozhsky and Bereznikovsky plants. The greater part of the high-quality titanium sponge was processed at the Upper Saldinsky metallurgical plant in Ural. In connection with the lack of own titanium and magnesium raw material, the UKTMP was operating in more difficult conditions than other enterprises in Russia and Ukraine. With the development of the titanium sponge producing facilities, the plant became experiencing a lack of titanium slag and had to adapt its technologies for various types of the raw material – rutile and titanium slag from Australia, Africa and America. This allowed accumulating extensive experience in processing of various titanium-bearing raw materials and to create a flexible process flowsheet.

The year 1989 recorded the peak of output by the UKTMP throughout the history of the plant operation. This was a milestone, the peak of production, simultaneously a starting point of the modern history of the plant.

Time for changes

In 1990 the plant was run by Bagdat Shayakhmetov. Perhaps the most difficult and most important role fell on his share. The year 1991 was the time when the economic and production relations between the Soviet enterprises began destroying. To remove the UKTMP as a competitor from the titanium and magnesium market, supplies of carnallite and titanic slag from Russia and Ukraine were completely ceased in 1993, while the usual customers stopped buying titanium sponge, since the market was oversupplied with the titanium products reserves kept in the warehouses produced by the former military and industrial complex of the former USSR.

A dilemma emerged to die or seek for the ways of recovery in the new conditions. Bagdat Shayakhmetov, who came to the plant while a boy and grew in his career from a worker to the head of the plant, did not consider any other option, except for struggle. 

For this, they had to resolve a big number of important and urgent tasks – to re-equip the process line, taking into consideration the lack of titanium and magnesium raw material, to search for a new market for selling of products, and to carry out certification of the titanium sponge for the new consumers, the Western companies.

In many respects, the destiny of the strategic sector depended on decisions taken at the governmental level. Thus, the plant director proposed to develop a program of the sector development. This initiative had been supported by the Head of the State Nursultan Nazarbayev and Government of the Republic of Kazakhstan, and already in 1992 Kazakhstan was the first among the CIS countries who developed a national program of extensive development of the titanium and magnesium industry. The program provided for the setting up by the UKTMP of its own raw material base, processing of raw material into titanic slag, increase in the capacity of the metallurgical equipment, certification of production as per the international standards, producing products with a higher added value in the value chain, involving the production of titanium slag, titanium ingots and titanium alloy, also of end products with a high added value.

With such strategic program in action, the enterprise was provided an opportunity to build up a vector of future activities. During the most complicated period, when plants and factories were closing throughout all Kazakhstan because of breakup of former relations, the plant began constructing a new shop for concentrate smelting. The project looked fantastic. Isn’t it strange to build the shop with no raw material available for it; moreover, this raw material had first to be explored, produced and delivered? At that time the republic counted only on the domestic ore reserves.

With that purpose the geological reserves of three mines located in the Aktobe Oblast, Kostanai Oblast and East Kazakhstan Oblast were explored and approved. In 2000, an ore mining enterprise Satpaevsk Titanium Mines Ltd with participation of UKTMP JSC was set up in the Kokpektinsky rayon, East Kazakhstan Oblast. The enterprise was named after the patriarch of the domestic geology, Academician K. I. Satpayev. Following the pit mining and launch into production of the industrial unit, the plant produced an ilmenite concentrate for the first time in the history of Kazakhstan. In 2000–2002, together with geologist from Japan extra geological prospecting was carried out. This allowed increasing the explored reserved by 50 per cent.

Finally, the raw material issue was closed in 2000 with the putting into operation of an ilmenite concentrate producing shop. Its launch into operation took place in the presence of President of Kazakhstan Nursultan Nazarbayev. For the first time in the history of the republic titanium slag was received, the raw material for production of titanium sponge and pigment titanium dioxide.

In parallel with ensuring the raw material independence of Kazakhstan, the search of new markets for selling of products was in progress. Only very high quality of titanium sponge could provide the access of this product to the external markets. The plant had to develop many technological processes on its own, since no one was going to share the experience and developments. When the UKTMP entered the global market with its titanium sponge, the quality of the product was found meeting the international standards. This became the main pass for international certification.

The plant passed through the first stage of international certification by international consumers in 1994–1995. At that time, aerospace companies conducted more than a dozen of audit inspections, confirming with their certificates that they were satisfied with the product quality control system at the UKTMP. In 2000 the plant was issued a certificate of compliance ISO 9002, while in 2002 a certificate of compliance with the American aerospace standard AS 9100. In 2003 the quality management system at the plant was confirmed for its compliance with the requirements of new standards versions АS 9100:2001 and ISO 9001:2000.

The consumers of production of the UKTMP were Pratt & Whitney, General Electric, Snecma, Timet, Allvac and other respectable international companies. The plant turned into a largest integrated producer of high grade titanium for the aerospace industry. In this prestigious and most prospective from the economic point of view segment of the titanium market the UKTMP is meeting competition with Japanese producers today, whose achievements in this field are beyond doubts.

Environmental issues, involving the application of the advanced developments and technologies, were always a special focus of the top management of the plant while carrying out the production and corporate governance. In a 45 year history of the plant the design capacity of the UKTMP have increased three times, while the emissions have reduced by 3.2 times. This, in many respects, becomes possible due to extra investments in the environmental action plan.

The first large environmental facilities were put into and accepted for operation at the end of the eighties of the last century. These are a water recycling station, new slag storage pit, units that purify ventilation gases from dust and various chemical impurities. In 2004 the plant passed through certification of the environmental management system for its compliance with ISO 14001 and OHSAS 18001. Today, the UKTMP is introducing into operation new environmental protection facilities so that to reduce to the minimum damage caused to the environment as a result of carrying out a full cycle of processing of the products.

New horizons

During the time of the plant operation in the market condition about 15 types of titanium sponge intended for different purposes were launched into production, while the UKTMP became a brand name that was with dignity representing Kazakhstan in the external markets. Along with that, future prospects of development are seen in the titanium products with a higher added value, since the UKTMP set before itself a new global goal, which outlined the next step of development of the domestic titanium and magnesium industry. This is a project of developing a product line with a higher added value, which will allow deviating from the raw material orientation of the sector to production of titanium ingots and titanium alloy. The UKTMP did not close the project even in the years of recent economic recession. The skill of thinking strategically added to the general progress of the plant: the toр management clearly understood that by contributing to the improvement of production in the condition of economic recession, the UKTMP would quicker achieve progress after the end of the recession. Moreover, this breakthrough project was part of the republican Industrialization Program, while at the beginning of September 2010 in the presence of President of the country a new plant with production capacity of 11 thousand tons of titanium ingots of double melting a year was put into operation. This event predetermined a further trend in development of the domestic titanium industry. The plant faces new possibilities of cooperation with European and American enterprises engaged in processing of titanium ingots into finished products.

The first fruit in implementation of this potential was the setting up of a joint venture with French firm Aubert and Duval, the largest world’s supplier of steel products. The new joint venture, named UKAD, launched the construction of a plant for production of bars, forgings and other products for the aerospace industry – and this is the last, fifth value-added level in the value chain! On June 24, 2011 in Paris at the Le Bourget air show, UKAD JV and the EADS Group of Companies, the latter involves the world-known brands Airbus, Astrium, Cassidian and Eurocopter, entered into a long-term agreement for supply of titanium semi-finished products for forging parts and fasteners under the programs implemented by EADS, including for production of Airbus aircrafts. The agreement is aimed to set up a fully integrated system of titanium supplies between Aubert and Duval, EADS and UKTMP. With this system set up, UKAD JV will be processing titanium ingots manufactured at UKTMP in semis, while the Aubert and Duval Company will be in charge for production of forged parts that are needed for production of aircraft components. In addition, EADS and UKTMP agreed to sign a new agreement that will ensure the supply of titanium raw material to UKAD, and also to other suppliers of EADS until 2022.

The final chord in the creation of industrial-related integrated chain UKTMP – UKAD – Aubert and Duval, enabling to compete with world leaders in the titanium industry, was the launch of the UKAD JV’s plant in commercial operation in Les Ansiz in September 2011 during the official visit of President of Kazakhstan Nursultan Nazarbayev to France.

Cooperation between UKTMP and Asian partners is in active development phase. In August 2010 an agreement was reached with South Korea's POSCO to establish a joint venture to produce titanium slabs with their subsequent processing into titanium sheets and tubes. On October 18, 2011 in Ust-Kamenogorsk POSUK Titanium JV held an official ceremony, devoted to commencement of construction of a new plant. The value of the project is some $50M, and the launch of the plant into commercial operation is scheduled for late 2013.

So, today we can say that the strategic task of creation of a fully integrated production – from ore to finished products with a high added value is met. This means that the UKTMP implements into practice the objectives set by the President and government of the Republic of Kazakhstan with regard to industrial and innovative development of the economy of sovereign Kazakhstan.

On December 21 of 2010, the Ust-Kamenogorsk Titanium and Magnesium Plant was given a special award from the Head of the state in nomination “Industrial Breakthrough” at the Altyn Sapa competition. This award became a remarkable completion of the many-year program Titan that was developed and implemented under supervision of Nursultan Nazarbayev. The example of the UKTMP Director Bagdat Shayakhmetov and many thousand personnel of the plant which contributed into overall success of the plant evidences that the goal of the Kazakhstan-2030 Strategy to be among top 50 most developed states in the world is quite achievable, if every person adds his/her knowledge, will and labor in overall progress.

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