Lipetsk Oblast
Peter the Great ordered Lipetsk's iron foundry in 1702—NLMK now produces 21% of Russian steel, but 2024 drone attacks and EU slab sanctions test whether 737 billion rubles in revenue can survive 2025's eastward pivot.
Lipetsk Oblast exists because iron ore deposits attracted Peter the Great's attention in 1702, when he ordered construction of an iron foundry to supply his modernizing military. Three centuries later, the same geological inheritance powers Novolipetsk Steel (NLMK), which produces 21% of Russia's crude steel—more than any competitor—from a manufacturing complex covering 27 square kilometers.
The industrial foundation deepened through Soviet planning. In 1931, Novolipetsk Iron and Steel began construction on the site of the imperial-era mine. When German forces threatened in 1941, workers dismantled the blast furnace and power plant entirely, evacuating equipment to Chelyabinsk in the Urals. Reconstruction after liberation made the plant a technological leader: in 1957, Lipetsk became the first facility in the world to adopt 100% continuous casting, a process innovation that would reshape global steelmaking.
The transformation came through privatization. When Novolipetsk became a joint-stock company in 1992, it distributed shares to employees; by 1998, Vladimir Lisin had consolidated control and remains chairman today. Under his leadership, NLMK grew into Russia's fourth-largest steel company, exporting more than half its output—primarily flat steel products, electrical steels, and specialty coated materials—to global markets.
Present-day Lipetsk demonstrates the contradictions of sanction-era industrialization. In 2024, NLMK reported 737.51 billion rubles in revenue, up 5.5% from the previous year. Trade with BRICS countries grew 114% in the first nine months. But EU sanctions now target slab exports, and in mid-2024 Ukrainian drone attacks struck an air separation unit. The January 2025 tax increase from 20% to 25% will compress margins further.
By 2026, Lipetsk Oblast will test whether Russia's largest steel producer can redirect exports eastward fast enough to replace lost European markets. The same iron ore that drew Peter the Great now draws sanctions—proof that strategic resources create strategic vulnerabilities across three centuries of Russian industrialization.