Ukraine's largest manganese ore producer struggles amid energy shortages

Pokrovsky GOK (PGOK), Ukraine's leading manganese ore producer, faces significant challenges in restarting its operations due to ongoing issues with power supply, according to company's official release. The company, which halted manganese ore mining since November, 2023, continues to grapple with a shortage of electricity and the soaring costs associated with industrial energy consumption, resulting in an indefinite halt in production.

PGOK's chief power engineer, Pavel Litun, expressed pessimism regarding the prospects of resuming operations, citing the persistent energy crisis plaguing the region. Scheduled electricity restrictions have been imposed on the company for over a month, exacerbating its operational woes. Litun attributed the situation to a critical shortfall in electricity generation and the deteriorating technical condition of transmission equipment within the grid infrastructure.

Despite the shutdown of its primary production facilities, PGOK still consumes approximately 2 million kW of electricity, primarily to sustain essential operations such as drainage systems and security posts. In an effort to mitigate the impact of the energy shortage, the company has resorted to providing services to external organisations and selling recovered scrap metal from decommissioned equipment.

PGOK has also explored alternative energy solutions to alleviate its dependence on the strained power grid. Litun revealed plans to invest in additional generators and initiate the construction of solar farms, recognising the potential of solar energy as a viable long-term solution. While wind power proves inefficient for the region's latitudes, the company aims to commission a 1 MW solar farm by September, drawing inspiration from successful implementations by other businesses.

The challenges faced by PGOK echo throughout the Ukrainian manganese industry, with Marganetsky GOK (MGOK), the country's second-largest manganese producer, also suspending ore mining and processing operations. Compounded by the idling of Ukraine's ferro alloy plants, which are major consumers of manganese ore, the industry faces a period of uncertainty and stagnation.

The ongoing energy crisis underscores the urgent need for investment in modernising Ukraine's energy infrastructure and exploring sustainable energy alternatives. Until tangible solutions are implemented, manganese producers like PGOK and MGOK are likely to continue grappling with operational constraints, posing challenges to the broader industrial landscape in Ukraine.