US to remove sanctions from Rusal including Aughinish Alumina plant in Limerick

The US Treasury announced on Wednesday, December 19, about its intention to remove sanctions against Oleg Deripaska-owned Rusal, which is the parent company of the Aughinish Alumina plant in Limerick.

The Irish foreign ministry said in a statement that the Aughinish Alumina plant would be free from the threat of sanctions following a 30-day Congressional review period. The facility churns out a third of Europe’s alumina.

The deadline for complying with the sanctions extended several times before, and now it is until January 21, 2019.

The United States had declared earlier that the sanctions could be removed against Rusal if Russian billionaire Oleg Deripaska relinquished control of the company. So, the three Deripaska companies - Rusal, En+ and power firm EuroSibEnergo - have agreed to restructure to reduce Deripaska’s stakes.

The Treasury said in a statement on Wednesday, “These companies have committed to significantly diminish Deripaska’s ownership and sever his control.”

The deal agreed with the Office of Foreign Assets Control (OFAC) in the United States will prevent Deripaska from obtaining cash or receiving future dividends from the companies. His stake in En+ will fall from 70 percent to 44.95 percent.

The Irish government, which lobbied heavily in Washington for the removal of sanctions to protect 600 jobs at the Aughinish alumina plant, said the move was “a very welcome return” on those efforts.

Workers’ representatives also welcomed the US Treasury’s announcement. Ray Mitchell, an industrial organiser with Siptu, said the move was “good news for the protection of jobs” in Limerick.

“The fate of the workers at the Aughinish Alumina plant was always uppermost in our minds,” he added. “Hopefully the factory can keep going now at full production.”

However, Rusal was not immediately available for making a comment on this move. The London Metal Exchange, on the other hand, expressed its intention to lift suspension on Rusal if the US removes its sanctions.

As part of the OFAC agreement, half of En+’s restructured board of directors will be U.S. or UK nationals and Rusal’s current board chairman will step down. En+ will create a board of 12 directors, with eight directors independent of Deripaska, in 30 days.

Rusal in a press release said that the company welcome OFAC decision and would continue to do everything necessary to return the company to the regular working conditions.