Deputy Head of Sverdlovsk Region Government Alexander Petrov said that the new investor may take on the project if the current proprietor decides to stop any further financing, Ural Business Consulting reports.
The plant, which is currently under construction, will produce magnesium metal and precipitated silica with a nanodimensional structure. Russian Magnesium management announced that construction is expected to reach completion in 2014. The project is being built on a budget of $506 million of investments with the first extension costing a total of $190 million.
The Swiss company Minmet Financing Company S.A. stopped financing the project in November 2011 due to financial troubles, according to Petrov, Russian Magnesium’s primary shareholder, Ural Business Consulting reports.
“As the funding stopped, the company faces some debts now,” Petrov said, Ural Business Consulting reports. “These amount to about 60m RUR [$1.9 million]: this is arrears in wages, unpaid taxes, and – the lion’s share – payments for the project already designed by Uralgipromez.”
Petrov added that the Sverdlovsk region government was informed that Minmet Financing Company S.A. handed over its shareholding to Mark Lisnyansky’s Solimag. Minmet owned 50 percent plus four shares in Russian Magnesium.
“In case Solimag refuses to finance the project further, we are considering a number of other investment options,” the Sverdlovsk region vice premier said, Ural Business Consulting reports. “For one, Uralgipromez and its proprietor AFK Corporation say they are prepared to go on with this project.”