‘Norilsk Nickel’ challenges $2 billion damage assessment for Arctic fuel spill

Industrial giant Norilsk Nickel is disputing the official assessment of the environmental damage caused by the massive diesel fuel spill at one of its subsidiaries in the Russian Arctic. 

Russia’s regulatory agency for natural resources, Rosprirodnadzor, assessed the damage at 148 billion rubles (approximately $2 billion) and sent claims to the Norilsk-Taimyr Energy Company (the Norilsk Nickel subsidiary responsible for the accident), demanding voluntary compensation for damages to the local environment.

In a statement, the company claimed that the damages calculated by Rosprirodnadzor’s Yenisei Interregional Department “are based on principles that led to the distortion of the results and need to be adjusted.”

At the same time, Norilsk Nickel’s statement underscores the company’s readiness to pay full compensation for the environmental damage the spill has caused, “in accordance with the requirements of the existing legislation.”

Nornickel expresses its readiness not only to eliminate the consequences [of the spill], but also to completely restore the ecosystem of the area [around] the accident, in close cooperation with Rosprirodnadzor, and other state bodies and organizations.

At the end of May, a large-scale fuel spill at another Nornickel subsidiary caused massive environmental damage in the Russian Arctic. Approximately 21,000 tons of diesel fuel leaked out of a damaged reservoir at the Norilsk-Taimyr Energy Company’s Thermal Power Plant No. 3 in Norilsk, spreading into nearby rivers and the surrounding soil. The accident in Norilsk is the second largest fuel spill in Russia’s history, after the 94,000 ton oil spill that took place in the country’s northern Komi Republic in 1994.

Norilsk Nickel’s net profit for 2019 was $6 billion, meaning Rosprirodnadzor is asking for the equivalent of a third of the company’s profits as compensation for the spill. After Norilsk Nickel released its statement disputing the damage assessment, the company’s shares rose 2.2 percent on the Moscow Stock Exchange, RBK reports.