Norilsk Nickel finance squeeze comes to Kola Peninsula
CEO of mining and metallurgy giant Norilsk Nickel, Vladimir Strzhalkovskii, has ordered a stop in all new financial obligations. The company might now have to start firing workers and cut investments, among them in projects in the Kola Peninsula.
According to newspaper Vedomosti, Mr. Strzhalkovskii on 20 October signed a decree on the complete stop in all new financial obligations, including the acquisition of new equipment to the company’s departments and units. Only services and material essential for production are excepted from the decision. At the same time, the company is stepping up efforts to make clients return debts.
Norilsk Nickel is also about to revise its investment programme, which could hit several of the company’s plans for the Kola Peninsula, among them the further development of the “Severny glubokii” mine in the Pechenganickel unit.
In addition, Norilsk Nickel might have to fire employees. A moratorium on the hiring of new workers has already taken effect, and Mr Strzhalkovskii calls on the “optimization of staff”, Vedomosti writes. Also spending on all new social projects has been put on halt.
The crisis is aggravated by the major drop in nickel prices. Over the last few months, the price on nickel has plummeted from more than 50,000 USD per ton to about 12,000 USD.
Norilsk Nickel is the world’s biggest producer of nickel. It is also a major producer of cupper, platinum and several other metals. The company has main production facilities in Norilsk, Western Siberia. Also the Kola Peninsula is a key area for the company.
