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Russian metal company fined $2.1 billion for Arctic spill

Image Credit: SCANPIX/AFP

The metal company, Norilsk Nickel (Nornickel) was fined $2.1 billion (148 billion rubles) for the environmental damage it caused, after a diesel fuel spill into two rivers in Siberia. The Russian’s environmental watchdog, Rosprirodnadzor, said in a statement,

‘Including damage caused to water bodies as a result of pollution in the amount of 147,046,011,000 rubles and soils in the amount of 738,616,500 rubles.’ The watchdog also urged the company to repair the damage it caused to the Artic waterways.

The massive fuel spill occurred on May 29th when, when around 21,000 tons of the diesel fuel spilled from an ageing tank. It ended up in Ambarnaya and Dadylkan rivers and subsoil near the city of Norilsk in Siberia. The fuel tank collapsed at the Norilsk -Taimyr Energy Company’s Thermal Power Plant number 3. This power plant is a subsidiary of Nornickel and it is one of the largest exporters of natural resources in Russia. It is owned by the richest man in Russia, Vladimir Potanin.

Nornickel claimed that the accident occurred due to thawing permafrost which weakened the foundations of the fuel tank. The company is disputing the amount of the claim, and also the way they calculated the fine that must be paid. Nornickel in a statement said, ‘The company confirms its commitment to eliminate the consequences of the accident at its own expense.’

The Russian natural resources and environment minister, Dmitry Kobylkin, said, ‘Environmental damage and dealing with the consequences of a disaster are two incompatible concepts,’ He added, ‘And if a company is willing to prove its innocence in court, it has that right.’

Greenpeace compared this incident to the 1989 Exxon Valdez oil spill that occurred in Prince William Sound, Alaska. The group agreed with the size of the fine.

Analysts at Aton claim that the size of the fine is unprecedented in Russia. They claim that the size of the fine will help the Russian government state budget as its economy took a hit due to the coronavirus crisis (Russia’s economy shrank 12% in April). Also, the huge fine will send a message to other companies that under investment will not be acceptable.

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