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producers to cut their export prices in a manner similar to Russian crude oil sales on the world market. The discounts on Russian bituminous (black) coal relative to bituminous coal produced elsewhere hit record levels in spring and summer.
As of August 10, EU sanctions also ban the provision of financial services and insurance to vessels that transport Russian coal, regardless of destination. The move has caused a major upheaval in the maritime insurance industry and could well impact Russian coal exports overall. Nearly all Russian coal going to Asia must travel by ship. Media reports suggest that the maritime insurance ban has halted exports almost entirely in recent weeks.
Coal exports only have a marginal significance to the Russian economy as a whole, but they are critical at the local level. The rise in Russian coal production has been driven by exports. In recent years, about 60% of Russia’s coal output has been exported. Production is concentrated in Western Siberia, particularly the Kemerovo oblast. Coal production is dominated by a few large energy and coal companies. The roughly 30 monogorods (single-industry towns) that produce coal are largely sustained by their earnings from coal exports.
Norilsk intends to increase individuals’ share in charter capital to 25% within 10 years, RBC states, citing CEO Potanin. CEO noted that the mechanism will include providing employees with Norilsk Nickel shares in digital form and making company’s shares more accessible to individuals via a digital mechanism that would allow purchasing a part of the stock. The issuer of such a program could be either a non-profit organization or a subsidiary that manages the stake, Potanin added. Meanwhile, the program will include lock-up periods for employees so that people could not immediately get rid of these assets.
The deal on the merger between Norilsk and UC Rusal is suspended – CEO Potanin pointed out in the interview with RBC. Vladimir Potanin stated that this issue is not on the agenda at this stage, though the idea might be relevant in future, when it would be possible to negotiate with UC Rusal’s management. Also, the shareholder agreement between the two companies is coming to end this year and would not be prolonged, Potanin concluded.
UC Rusal to invest Rb30bn in creating technological valley – Interfax. The aluminum smelter signed an agreement with Khakassia Republic on creating technological valley with Rb30bn (c$493mn) investments. As a result, Sayanal’s capacity is seen expanding and new facilities are to be created, namely 36kt cold-rolled aluminum tape and 55kt aluminum foil plants. The mentioned CapEx implies c30% of UC Rusal’s M2M EBITDA, while potential increase in aluminium output might add c2-3% per year – moderately positive for the company’s operations.
157 RUSSIA Country Report October 2022 www.intellinews.com