VolgaKaliy press statement

Moscow, October 5, 2012 – EuroChem, Russia’s largest mineral fertilizer producer, announced today that its subsidiary, EuroChem-VolgaKaliy LLC, filed an USD 800 million claim against Shaft Sinkers (Pty) Ltd., a 100% subsidiary of Shaft Sinkers Holding plc, a London listed company, with the Swiss Chambers of Commerce in Zurich and the International Chamber of Commerce in Paris.

The claim seeks compensation for the costs and substantial lost profits incurred by EuroChem-VolgaKaliy due to the delay in commencing potash production as a result of Shaft Sinkers’ failure to complete the construction of the cage shaft at the Gremyachinskoe deposit, one of two Greenfield potash projects currently being developed by EuroChem in Russia.

Shaft Sinkers was chosen as the contractor to develop the cage shaft of the Gremyachinskoe deposit but subsequently proved unable to fulfill its contractual obligations. Shaft Sinkers’ grouting technology entirely failed, causing in excess of USD 161 million in direct costs and a delay to the project’s completion date which was subsequently revised to 2015.

About EuroChem:
EuroChem is a leading global agrochemical company, producing primarily nitrogen and phosphate fertilizers, as well as certain organic synthesis products and iron ore. The Group is vertically integrated with activities spanning from mining and natural gas extraction to production, logistics, and distribution. EuroChem is currently developing two sizeable potash deposits in Russia with the Gremyachinskoe (4.6 mtpa) and Verkhnekamskoe (3.4 mtpa) greenfield projects. Please visit www.eurochem.ru for further information.

For more information please contact:

Olivier Harvey
Head of Investor Relations
Phone: +7 (495) 795 2527 ext. 1519
Fax: +7 (495) 960 2293
E-mail: ir@eurochem.ru

Vladimir Torin
Head of Public Relations
Phone: +7 (495) 795 2527 ext. 1440
Fax: +7 (495) 960 2293
E-mail: pr@eurochem.ru

FTI Consulting
Moscow: Oleg Leonov
Phone: +7 (495) 795 0623
E-mail: oleg.leonov@fticonsulting.com

London: Larisa Millings
Phone: +7 (0)20 7269 7153
E-mail: larissa.millings@fticonsulting.com

Share this post
All announcements