Wednesday 22 August 2018

US hints Aughanish could escape sanctions

Aughinish Alumina refinery on the Shannon estuary
Aughinish Alumina refinery on the Shannon estuary
Donal O'Donovan

Donal O'Donovan

Shares in Aughanish Alumina's Russian-controlled owner Rusal jumped in Hong Kong yesterday and aluminium prices fell after the US administration softened its position on sanctions against the Russian metals giant.

The US sanctions, announced earlier this month, will prevent most major Western businesses doing business with Rusal and have cast a major doubt over 450 jobs at the huge Aughanish plant in Co Limerick.

However, the US Treasury on Monday discussed a path for lifting the sanctions on Rusal - saying it would provide relief if Russian billionaire Oleg Deripaska gives up control of the world's biggest aluminium producer.

Rusal has been caught up in the sanctions because of its ties to Oleg Deripaska, who in turn is linked by the US to Russian president Vladimir Putin.

Authorities in the US also extended the deadline for third-party companies to wind down dealings with Rusal by almost five months.

That will make life easier; for example, allowing more time to shift banking arrangements of logistics contracts.

Shares in the Russian producer jumped as much as 26pc in pre-market trading Tuesday morning in Hong Kong to HK$1.92 after surging 18pc in Moscow on Monday. Aluminium on the London Metal Exchange dropped 1.8pc to $2,254.50 (€1,844.19) a metric ton after tumbling 7.1pc yesterday, the most in almost eight years.

Authorities here, including Taoiseach Leo Varadkar's office, have said they are monitoring the Aughanish situation, and the plant continues to operate.

(Additional reporting Bloomberg)

Irish Independent

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