Eastern Russia - Chukotka Autonomous Okrug (Territory)

Okrug Area: 7,215,000 sq. km (including northern territories)
Population: 50,500 approximate in 2006
Capital city:  Anadyr
Governor, Head of Government: Roman Arkadievich Abramovich

History

The first people came to the Chukotka territory thousands of years ago, during the Stone Age period. They were primitive hunters who came from the Southern parts of Central and East Asia. In those days, the tundra of North-East Asia and Alaska were connected to each other by means of a natural land bridge called Beringia, which was covered with woods, grazing herds of mammoths, woolly rhinoceros, bison and reindeer.

In the early 1940s, after the German invasion into the Soviet Union, tin mining began at the Valkumey Mine, and by the end of 1941, the first few tonnes of tin were extracted.  During the war, Chukotka was the major supplier of tin necessary for the military complex and when the war ended, the importance of the tin industry became even greater as the destroyed country needed to be rebuilt. At that time, mine workers were made up of mostly prisoners, and the mineral resource industry had become the basis for the Chukotka economy. 

The Chukotka Autonomous Region is located in the most north-eastern area of Russia, located on the Chukotka peninsula and part of the adjoining mainland.  In 1953 the Magadan Region (Oblast), including Chukotka National Okrug was established. Thirty-nine years later, on June 17, 1992, Chukotka separated from the Magadan Region to become one of Russia’s 89 regions and has held the status of an independent subject of the Russian Federation since then.

Economy

Chukotka's economy is concentrated on natural resource extraction and harvesting. The production of both agricultural and finished goods is limited to a level necessary to satisfy local needs. Chukotka's economy relies mainly on the export of coal, gold, silver, platinum, tin and tungsten concentrates, scrap metal, fish, caviar, leather products (raw and finished), hormone and enzyme extracts, sea mammal fat, furs, and souvenirs.  Essentially, gold mining is the key source of revenue for Chukotka.

Gold Mining

Chukotka has some of the most promising gold deposits in Russia. Although Chukotka’s gold-mining industry still remains undeveloped, it has attractive opportunities for investment.

Gold mining has always been one of the traditional and leading industrial sectors in Chukotka. It began in 1958 and was centered in Bilibinsky, Smidtovsky, and the Chaunsky districts.  During the late Soviet Era (1960-1990), about 700 tonnes (21.77 million ounces) of gold were recovered and from 1991 to 2002 gold output ranged from 6.1 to 9.1 tonnes (190,000-285,000 oz) gold.  Additionally, the region is highly prospective for both tin and tungsten, although after the collapse of the Soviet system, only the gold industry remained in production.
 
The region has 463 gold deposits.  Many lode deposits contain reserves classified under the Russian system as ‘C-1’ or ‘C-2’, which are equivalent to ‘proven’ and ‘indicated’ reserves in western nomenclature respectively.   Among the placer deposits, 340 utilized open-cut extraction methods; 90 are underground; 24 utilized hydraulic technologies; and 3 have been mined with floating, bucketline-stacker dredges.
 
The growth of the Russian gold-mining industry after the financial crisis of 1998 didn’t affect Chukotka enterprises, due mainly to the region’s remoteness. The main prospect for the region now is a consolidation of small enterprises into bigger ones and the exploration of gold ore deposits.  This strategy began to work a few years ago and has been developing very effectively.

The most important mineral development in Chukotka, since the Soviet Era, is the Kupol project, about 200 km southeast of Bilibino.  Gold-silver mineralization was recognized at the Kupol zone in 1995 by the Russian State-sponsored Anyusk Geological Expedition.  In 2002, Canadian-based Bema Gold Corporation (Bema) acquired the Kupol project and through exploration has defined a probable reserve of 4.45 million ounces of gold and 54 million ounces of silver and an inferred resource of 1.7 million ounce of gold and 22 million ounces of silver.

Infrastructure

Bilibinskaya nuclear power plant, Chaunskaya thermal power plant and Ekvekinotskaya hydroelectric power plant produce abundant amounts of energy. Regional centers are equipped with relatively high-capacity diesel and turbine (including atomic-power driven) power generating stations, and smaller settlements are equipped with diesel generators. There is one major electricity grid in Chukotka (LEP-110) linking Pevek, Bilibino and Zelenyi Mys, and several local grids.

In the early 1990s, most freight was moved by air or sea, and the percentage of freight moved overland comprised only about 10 percent of total freight transport. However, due to the short maritime navigation season (necessitating a high level of logistical coordination) and the tremendous growth in airfreight costs associated with the economic transition, the most common means of freight transport became overland after the post-Soviet economic collapse.

Chukotka possesses over 5,000 kilometres of road, of which almost half were built over the past ten years. Of this total, only 1,200 kilometres are surfaced (gravel); the remaining portion consists of winter roads. The priorities for improvement in the road network presently lay with the construction of a hard-surface all-weather road linking Egvekinot, Pevek and Bilibino, and in conjunction an expanded network of winter roads feeding into this improved stretch. Over the long term, this project is viewed as the most important step in the direction of the construction of the Eastern Chukotka Highway.

The sole means of year-round transport in Chukotka is by air. This is the only reliable means of traveling between settlements on the territory in all seasons and virtually the only form of passenger transport to and from Chukotka from other regions of Russia. During Chukotka's autumn season, when the tundra becomes unsuitable for any form of overland travel, air transport is particularly vital. Priorities for improving regional air transport includes the upgrading of Chukotka's two major airports in Pevek and Anadyr (both of which are federal airports and can handle large airplanes) and the upgrading of regional airports supporting intra-regional air routes.