By John Helmer in Moscow

Russia’s Evraz group cannot sell its Highveld assets but appears that it might be buying more Russian vanadium.

The Evraz group, Russia’s largest steelmaker, has twice tried to corner the global market in ferroalloys, once in manganese, and once in vanadium.

It has failed at both, obliged by stronger forces than it anticipated to withdraw entirely from the manganese game; and to withdraw for a pause in its vanadium attack.

Since July of 2006, Evraz’s South African acquisition, Highveld Steel & Vanadium, has been a test case of the European Commission’s (EC) will to regulate a Russian metals group in its global market reach. In the hope of changing vanadium’s losing streak, Evraz has been requesting extensions of time from the EC in Brussels, in the hope that the vanadium price will stop sliding, and lift the selling price of the Highveld assets, which the EC ordered sold off a year ago, and which Evraz has so far declined to do.

In addition to stopping the clock to buy more time against the metal price curve, Evraz appears now to have pulled a curtain over a fresh Russian vanadium acquisition, challenging the EC’s will to blow its whistle in the dark.
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by John Helmer - Tuesday, January 29th, 2008
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By John Helmer in Moscow

Part-2 investigation of the Russian gold assets backing OTC traded gold shares – ABV Gold, Aurus, and Golden Share

Alexei Ivanovich, the hero of Fyodor Dostoevsky’s novel, The Gambler, played roulette – desperately, but more fortunately than Dostoevsky himself. In Pyotr Tchaikovsky’s opera, Queen of Spades, the heroine played the card game faro – fatally. In the time when Boris Yeltsin was Russia’s president, a 19th century form of gambling returned to become a popular obsession across the countryside. The organizers were called napyorstochniki — literally, “thimblers”. For in Russia, the classic shell game has been played, not with walnut shells, but with three thimbles.

The pea is the same. Now you see it to bet on; now you don’t – and you have lost your money. Watch carefully, for in this tale, under the nimble fingers of the napyorstochniki will go a stock of 40 to 80 tonnes of gold, mineable from a tailings pile, and worth from $1.1 billion to $2.3 billion, only to disappear, as if they never were. Then the gold reappears, this time in a remote hard-rock location of northeastern Siberia, now worth almost $4 billion – only to prove unfindable, as soon as the thimbles are upturned.
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by John Helmer - Thursday, January 24th, 2008
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By John Helmer in Moscow

Through the Nabucco pipeline project, Bulgaria decides to reap the benefit of Europe’s energy demand.

The fat lady has finally sung — the operatically named Nabucco gas pipeline project, intended to carry Central Asian gas to European markets, avoiding Russia, appears to have been knocked out by an agreement between Bulgaria, Russia, and Italy’s ENI.

Negotiated on Thursday and Friday in Sofia, the Bulgarian capital, by President Vladimir Putin and Bulgarian President Georgi Parvanov, the deal means that “Bulgaria has become a key link in the European energy chain,” Putin announced. Parvanov said: “Bulgaria has always suffered from its strategic location, and the time has comer to reap the South Stream, a new 900-km gas pipeline to be supplied by Gazprom, Russia’s natural gas producer, is to be built under Black Sea, and make land on the Bulgarian coast. From there, the pipeline will fork, delivering gas estimated at 30 billion cubic metres per annum southwards to Italy and Greece, and northwestwards to Hungary, Czech Republic, and Austria.

Austria and Turkey have previously proposed an alternative pipeline, route and feedstock, backed by Washington and Burssels. It is unclear why a gas export pipeline, intended to run from Turkmenistan and Kazakhstan on the eastern shore of the Caspian Sea, across the seabed, and then through several Caucasus and Balkan states, to Vienna, should be named after Nabucco, the Verdi opera of 1842.
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by John Helmer - Tuesday, January 22nd, 2008
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By John Helmer in Moscow

ABV Gold cannot substantiate its market claims to a multi-billion dollar gold and silver property in Russia.

In the folk history of the Russian trades, it was always said that a tailor lacks trousers, and the shoemaker lacks shoes. A Canadian from Montreal, promoting a penny gold mining stock registered on the U.S. Over-the-Counter market (ABVG:US) is writing a new chapter. This is the one about the gold miner without a goldmine.

According to a posting on the ABV Gold website, on September 24, the company “closes acquisition of a 70% interest in a producing gold mine in Russia.” The link from this announcement leads to www.pinksheets.com, where there is no record of the transaction, the value, the price, or the “producing gold mine.”

A few days later, on October 14, Dan Ryan, the President and Chief Executive of ABV Gold, posted an “open letter to shareholders”, responding, he conceded, “to repeated queries about the status of our company, in particular, requests for more data concerning our gold mine holdings in Russia.”
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by John Helmer - Friday, January 18th, 2008
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By John Helmer in Moscow

State-owned maritime fleet leader Sovcomflot is making a last-ditch bid to reap value for its bonus-holders before the Russian presidential election on March 2. But the lack of time isn’t the only catch.

Sovcomflot ‘s bid to buy out minority shareholders of Novorossiysk Shipping Company (Novoship) has been rejected by Moscow investment bankers and brokers as too low. The Sovcomflot offer was issued on January 10, with a $3.34 price tag per voting share. This was initially estimated as a 12% premium on a previous floating average, and was reportedly advised by Sovcomflot advisor, Morgan Stanley. But the premium has already shrunk to 5% on current market valuations.

“We do not recommend that Novoship’s minority shareholders accept Sovcomflot’s offer because the offer price is lower than our fair value,” reports Moscow-based Finam Investment Company. Its advisory to investors said they should retain their shares in the expectation of a much higher market value and share price, if and when a proposed IPO is launched by Sovcomflot. Finam says it values Novoship shares at $3.61 — 8% more than the current offer.
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by John Helmer - Thursday, January 17th, 2008
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By John Helmer in Moscow

Russian regulator Oleg Mitvol wins battle for tougher federal mine licensing.

Little children trying to sleep in the bungalows of the British colonial territories in India were once entranced by the tale of Little Black Sambo, whose story was first published by Helen Bannerman in 1899. Pursued by four tigers, Sambo must save himself, which he does by giving up his green parasol, his brand-new red jacket, blue short-pants, and purple curly-toed shoes. Still ravenous, the tigers chase around the tree in which Sambo is perched, until they turn into ghee butter. Sambo then climbs down, and goes home, where he slaps the ghee on to 169 pancakes he devours for his supper.

In the federal regulation of the Russian mining sector, Oleg Mitvol has just proved that he can turn his predatory superior, Sergei Sai, into something edible for supper.

Last week, Sai announced he had resigned his post as chief of Rosprirodnadzor, the licence inspectorate and environment regulator. According to Sai, in remarks reported by a Russian news agency, “We lost control. For example, the head of the [regulator] does not appoint his own deputies. Instead of being able to issue an ordinary reprimand to the head of a regional department, I have to write a letter to the minister to initiate an administrative investigation.”
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by John Helmer - Wednesday, January 16th, 2008
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By John Helmer in Moscow

Achilles heel uncovered by US court in Russian aluminium champion

In seventy-four closely argued pages, US attorneys have this week applied to the US Court of Appeals for the 2nd Circuit (New York) to reverse a series of lower court judgements, and order trial of charges that Victor Vekselberg and his associates stole crude oil and Russian oilfield licences worth several hundred million dollars from Norex Petroleum Limited, owned by a Canadian named Alex Rotzang.

If the appeals bench of judges agrees, the outcome directly threatens defendant Vekselberg, the second shareholder of United Company Rusal, one of the world’s largest aluminium producers, with US visa and tax sanctions. A ruling for Rotzang by the US court would also trigger UK prohibitions on Vekselberg continuing to serve as a member and chairman of Rusal’s board of directors.

But even before the US court rules, the relatively unnoticed 6-year litigation exposing Vekselberg’s business past, already casts a shadow over the attempts both Vekselberg and his shareholding partner in Rusal, Oleg Deripaska, are making to list their company internationally, either through a London Stock Exchange initial public offering (IPO); or through a takeover and reverse listing with Norilsk Nickel.
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by John Helmer - Monday, January 14th, 2008
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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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