Russian watchdog files $2 billion lawsuit against Nornickel for fuel spill damage

The environmental watchdog, Rosprirodnadzor, has sparred with the company over the cost of damages from the spill.

By Reuters - September 10, 2020
The logo of Russia’s miner Norilsk Nickel (Nornickel) is seen on a board at the St. Petersburg International Economic Forum 2017 (SPIEF 2017) in St. Petersburg, Russia, June 1, 2017. (Sergei Karpukhin / Reuters File Photo)

MOSCOW — Russia’s environment watchdog said on Thursday that it had filed a lawsuit against a power business owned by mining giant Norilsk Nickel to claim 148 billion roubles ($1.96 billion) for environmental damage caused by a fuel leak in the Arctic earlier this year.

The spill occurred on May 29 after a fuel tank lost pressure and released 21,000 tonnes of diesel into rivers and subsoil near the city of Norilsk in Siberia. Greenpeace has compared the incident to the 1989 Exxon Valdez oil spill off Alaska.

The watchdog had previously asked Nornickel to pay this sum voluntarily. Nornickel argued with it over the sum but set aside $2 billion in reserves, which caused a slump in its first-half net profit.

Nornickel did not reply to a Reuters request for comment on Thursday.

Some analysts have said that the amount is not critical to the financial stability of the $41-billion mining giant but it could prompt it to increase debt and reduce dividends.

Nornickel shares were down 1.2 percent in Moscow on Thursday, underperforming the benchmark index, which was broadly stable.

Reporting by Anastasia Lyrchikova and Polina Devitt.