Norilsk Nickel Disagrees With Methodology Used for Calculating Fuel Spill Damages

MOSCOW, July 8, 2020 /PRNewswire/ -- Nornickel, the world's largest producer of palladium and high-grade nickel and a major producer of platinum and copper, disputes the methodology used for calculating environmental damage caused by the diesel fuel spill near Norilsk on May 29th, as put forward by the Federal Service for Supervision of Natural Resources Management (Rosprirodnadzor). At the same time, Nornickel reiterates its strong commitment to fully cover the cost of remediation of the environmental impact of this accident. Today, the company sent a letter to that effect to Rosprirodnadzor.

According to the company, the calculations of damages caused to water bodies and soil made by the Yenisei Interregional Department of Rosprirodnadzor are based on principles that led to distortion of the results and need to be adjusted.

In particular, the maximum coefficient of 5 was applied in this calculation, which assumes that no measures аre taken to eliminate the negative impact of a pollution on a water body (the Kdl coefficient). Meanwhile, according to the prevailing legal practice, such a coefficient is punitive in nature and is applied only in cases of gross negligence, when no pollution mitigation efforts after accidents have been undertaken at all, or over a long periods of time. Considering the Company's immediate response and launch of the clean-up effort of the diesel spill, applying the maximum punitive Kdl coefficient cannot be justified.

Moreover, within the existing judicial practice, the maximum Kdl coefficient applies to cases of pollution of water bodies with pollutants that are soluble. Diesel fuel, if leaked to a water body, does not fall under the category of soluble pollutants, because it remains collectable from the water surface.

In the Company's opinion, the volume of oil sub-products spilled to the water bodies and soil has been also determined incorrectly, since the estimate was made before collection of oil sub-products in this area was completed. Meanwhile, a significant part of the fuel spill has been neutralized by the sorbents applied.

The Company maintains its strong commitment to fully cover the cost of remediation of the environmental impact of the fuel spill accident in line with the requirements of current legislation. Furthermore, Nornickel stands ready not only to remediate the environmental impact, but also to completely restore the ecosystem of the impacted area in close cooperation with Rosprirodnadzor and other government agencies.

The Company has organized regular monitoring of the environment in the impacted area in order to receive objective measurement of the pollution levels and the effectiveness of clean-up efforts. Recent water tests by Rosprirodnadzor confirm that measurable pollution levels have decreased and the level of pollutants' is normal according to the maximum permissible concentration (MPC) scale.  Nornickel has already launched land recultivation program.

About MMC "Norilsk Nickel," "Nornickel" or the "Company."

MMC Norilsk Nickel is a diversified mining and metallurgical company, world's largest producer of palladium, high-grade nickel and a major producer of platinum and copper; it also produces cobalt, rhodium, silver, gold, iridium, ruthenium, selenium, tellurium, sulphur and other products. Nornickel shares are listed on the Moscow and Saint Petersburg Stock Exchanges; ADRs are traded over the counter in the U.S. and on the London, Berlin and Frankfurt Stock Exchanges.

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SOURCE MMC Norilsk Nickel