By John Helmer in Moscow

Norway and UK probe Hydro’s aluminium operations with BVI cutout companies.

The High Court in London is considering a trial this year of claims to one of the largest missing aluminium smelter fortunes in the world. The missing money, estimated to be as high as $500 million per year, is disappearing from the Tajikistan Aluminium Plant (TadAZ Talco), whose principal trading partner is Hydro Aluminium, the state-controlled Norwegian aluminium producer.

The details of the UK court litigation, initiated by the smelter and its owner, the Tajik government, are accumulating in confidential records of preliminary and procedural hearings, which continue this month. The trial later in the year will expose the evidence publicly, and it is likely that Hydro will be summonsed to testify, not least of all because of admissions Hydro has publicly made to Mineweb that it has reassigned contracts signed a year ago with the smelter to a Caribbean cutout company with the same name as the smelter, Talco Management Limited (TML). “The arrangements” with the latter, Hydro spokesman Halvor Molland told Mineweb this week, “are an integral part of our settlement agreement with the Talco smelter.”
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by John Helmer - Friday, January 11th, 2008
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By John Helmer in Moscow

Another Xmas mystery at Oxus – CEO leaves, unlocks value.

The idea that Santa Claus brings presents to those who deserve them comes from the original St. Nicholas, a bishop of the Byzantine era. He was famous for his gifts to the poor, in particular presenting the three miserable daughters of a pious Christian in the diocese with dowries, so that they would not have to become prostitutes. Names and addresses aren’t given.

The deal also made Nicholas the patron saint of those who specialize in giving with one hand, and taking with the other – pawnbrokers.

The Christmas mysteries at Oxus Gold, the London-listed junior, have been chronicled by Mineweb as the share price collapsed in November on no news, and then hesitated with two announcements from hedge fund, RAB Capital Special Situations, that it was buying Oxus shares (November 26), then selling them (December 10). Accompanying RABcap’s moves, the management of Oxus has been assuring the market that all is stable.
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by John Helmer - Wednesday, December 26th, 2007
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Many things can make a person greater than he or she really is, except for time.

Time activates the bacteria that strip the flesh off the bones, until only a forensic pathologist can detect the tiny signs of individuality; and even they add up to nothing more than a catalogue of pain and death.

Time unravels the outcomes of all endeavours. The maddest passions, the wildest exploits, the most ruthless ambitions, the most victorious strategy – all lose their genius in time.

I was brought up on the reverse. I read, and was accordingly certain, that mankind produced heroes whose deeds outlived themselves. Even small deaths, the ones we as schoolboys used to stand at attention to remember twice or three times every year, defied time. The evidence of that was surely that we were standing there saluting, wasn’t it?
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by John Helmer - Saturday, December 22nd, 2007
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By John Helmer in Moscow

Despite several rebuffs this year already, and problems faced by other non-Russian putative investors into the country’s steel sector, ArcelorMittal tries to set up new steel mill near Moscow.

For the great Anglo-Indian families — I mean, wealthy Indians who live in London — it is galling to observe the contrast between the ease with which they draw passports and titles from the British government; and the difficulty they encounter arranging a cup of tea with the President of Russia.

But then it oughtn’t to be so difficult for the Mittals or the Hindujas to appreciate the traditional Russian maxim — never stand between a dog and a tree.
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by John Helmer - Friday, December 21st, 2007
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By John Helmer in Moscow

Russian PGM sales controller complains market reaction isn’t cricket.

A one-line decree, issued by Russian Prime Minister Victor Zubkov, has stumped Russia’s platinum producer, Norilsk Nickel; the state agency for export sales of platinum, Almazjuvelirexport; and the government body in charge of issuing export licences, the Ministry for Economic Development and Trade.

Whether Zubkov was warned to anticipate the market impact or not, international spot trading in platinum has driven the metal price up 6% this week to a record high approaching $1,520/ounce.
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by John Helmer - Wednesday, December 19th, 2007
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By John Helmer in Moscow

London market plays Scrooge as RAB sells Oxus Gold for 100% premium.

The streets of all the Christian cities of the world are filled at this time of year with buskers singing carols, holding out hands or buckets to receive offerings of money for the less fortunate in this world.

It must have been in this spirit that on December 10, Oxus Gold, the London-listed junior gold miner, announced that its principal shareholder, RAB Special Situations (Master) Fund, has granted Zeromax GmbH, its second largest shareholder, an option to buy up to 52.254 million of Oxus shares. RAB proposed to sell at 80 pence per share until December 18, with the possibility of extending the offer to January 31, 2008. On the day, RAB made this offer, the market price of Oxus shares was 40 pence. Thus, it seems the seasonal charity was on the Zeromax side, and it was RAB doing the busking — for a premium of 100%.
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by John Helmer - Tuesday, December 18th, 2007
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By John Helmer in Moscow

The casebook of the great modern neurologist, Oliver Sacks, contains the extraordinary case of Dr Tony Cicoria, who was struck by a bolt of lightning, and left for the rest of his life with an insatiable desire for classical music. Uncontrollably, he heard a piano playing in his head, and would try to write it down. This was difficult, because he had paid little attention to music for most of his life, and had forgotten how to notate it.

The usual brain scans have all been tried, but noone, not even Dr. Sacks, knows how the near-fatal bolt of electricity has caused such an inspiration.

About the recently disclosed sale, purchase and loan agreement between Mikhail Prokhorov, part-owner of Norilsk Nickel, and Oleg Deripaska, controlling shareholder of United Company Rusal, something like the mysterious bolt of electricity must have struck, because of the strange and unprecedented inspiration that has followed.
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by John Helmer - Monday, December 17th, 2007
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By John Helmer in Moscow

Ivanov tries a second board meeting to push through mine licence and share transfer.

In Russian villages, they say the law is like a sleigh. A clever man can steer it either way. If the villagers knew about share emissions, their suspicion would be the same.

On December 18, the board of directors of Polyus Gold is scheduled to consider a proposal for a share emission, which is being steered by Mikhail Prokhorov, at the moment the controlling shareholder of Polyus, and his chief executive, Evgeny Ivanov. They are proposing the board agree to a share emission by Polyus subsidiary, Polyus Exploration (Russian name, PolyusGeologoRazvedka, PGR) that would do two things – dilute the stake of Prokhorov’s rival, Vladimir Potanin, in the new company; and transfer gold exploration and mining licences, plus mine company shares, from the parent company to the affiliate, in order to pay for the vesting.
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by John Helmer - Friday, December 14th, 2007
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By John Helmer in Moscow

The war over Norilsk Nickel’s shares to trigger owners’ battle on Friday.

“Let the man who seeks revenge,” the old Chinese proverb warns, “remember to dig two graves.”

For months now, Russia’s most valuable mining asset, Norilsk Nickel, has been the object of a bitter personal war between the two men, who took the asset from the state a decade ago – Vladimir Potanin and Mikhail Prokhorov. Norilsk Nickel has a current market value of $52.2 billion; its share price on the Moscow exchange is currently $274. But the value is under pressure from the war, and on Friday this week in Moscow, they will stage a new battle. The occasion is an extraordinary general shareholders’ meeting, called to vote on the 11-month old plan to create a new company, Energopolyus. Prokhorov has said he will vote his 28% stake in the company to prevent the spinoff of non-core electricity assets into Energopolyus, which was agreed by Prokhorov and Potanin last February.

The fight over the division of the assets Potanin and Prokhorov have co-owned for more than a decade has turned vengeful — and Prokhorov has started digging graves. A banker close to him has told Mineweb Prokhorov isn’t so much opposed to the spinoff, as determined to throw a spoiler in the transaction, creating uncertainty and confusion for the bankers being asked to lend on either side of the split between Potanin and Prokhorov.
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by John Helmer - Wednesday, December 12th, 2007
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By John Helmer in Moscow

Putin’s endorsement of Medvedev, and vice versa, leaves mining policy issues up in the air.

President Vladimir Putin did his best to make the selection of Dmitry Medvedev, 42, his former chief of staff and St. Petersburg lawyer, as natural an endorsement as he could of the capabilities of a man he’s worked with for 17 years. But Prime Minister Victor Zubkov went one better. He revealed the power politics behind the selection.

Putin stage-managed the announcement in Monday’s meeting with Boris Gryzlov, the outgoing parliament speaker and leader of the dominant incoming party, United Russia. It was the classic Russian line: the tsar is the father of the people. According to Gryzlov, “we believe that [Medvedev] is the most socially oriented candidate and has demonstrated his abilities well in leading the national projects and the demographic program. “Putin declared: “We have worked closely through all of these years, and I completely and fully support this choice.” This was the classic Bolshevik refrain – loyalty to unanimity, unanimity of the loyal. Victor Ilyukhin, a senior Communist Party figure, responded with the classic statement of the left opposition, identifying Medvedev as without party principle, ideology or conviction: “Medvedev is insecure, weak. Putin can have full control of him.”
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by John Helmer - Wednesday, December 12th, 2007
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