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Russia's Environmental Watchdog Wants Oligarch-Controlled Norilsk To Foot $2 Billion Spill Bill

The cleanup operation following the massive fuel spill outside Norilsk on June 10.
The cleanup operation following the massive fuel spill outside Norilsk on June 10.

Russia's state environmental watchdog said metals producer Norilsk Nickel should foot the estimated $2 billion bill for damages caused by a massive fuel spill at the company’s operations in the Arctic.

Rosprirodnadzor said it had sent a request for "voluntary compensation" to a subsidiary of Norilsk Nickel, putting the damage to Arctic subsoil and water resources at 147.8 billion rubles ($2.06 billion).

A Norilsk Nickel spokeswoman said the company had not yet received the papers from Rosprirodnadzor. Nornickel has promised to pay the costs of the cleanup, which it estimated at 10 billion rubles ($140 million).

Norilsk Nickel, the world’s largest producer of nickel and palladium, is controlled by Russia's richest man, Vladimir Potanin, whose fortune is estimated by Forbes at $23.5 billion.

Rusal, a company founded by powerful billionaire Oleg Deripaska, owns 25 percent of Norilsk. The fine could impact the company’s ability to meet its high dividend expectations, much of which flows to Potanin and Rusal.

In what has been described as the worst environmental disaster to impact the Arctic, more than 21,000 tons of diesel fuel spilled into the soil, two rivers, and a downstream lake on May 29 after a storage tank at a Norilsk Nickel-operated power plant collapsed or sank due to what the company said was the thawing permafrost soil.

Greenpeace has compared the incident to the devastating 1989 Exxon Valdez oil spill off Alaska and estimated the environmental damages at around $1.4 billion.

Two plant managers and two top engineers have been arrested on suspicion of violating environmental-protection rules while the mayor of Norilsk and a government inspector have been charged with negligence.

Norilsk Nickel has since said it plans to boost its cooperation with Russian and foreign researchers focused on the Arctic ecology and permafrost zones to find solutions and improve the industrial safety in the region.

With reporting by Reuters, dpa, and Interfax
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