MOSCOW, (Reuters) – Russia warned Guinea yesterday that relations could be damaged by a court ruling to strip UC RUSAL of the large alumina refinery it acquired three years ago in the West African country.
UC RUSAL, controlled by Russian billionaire Oleg Deripaska, also staked its claim to Guinea’s biggest industrial project. The world’s largest aluminium producer issued a statement to say the Friguia refinery was its “legitimate property”.
A court in Guinea, the world’s biggest exporter of aluminium raw material bauxite, cancelled the sale in 2006 of the Friguia refinery to UC RUSAL, the latest development in a dispute between the new government and foreign miners.
“Guinean authorities have made an attempt to expropriate UC RUSAL’s property in court,” the Russian Foreign Ministry said in a strongly worded statement.
The ministry said it hoped Guinea would take responsibility for the “possible consequences of such actions for the general climate of traditionally constructive Russian-Guinean relations, as well as for the social-economic situation in the country”. The government in Guinea, which also sits on rich iron ore and gold reserves, took power in a military coup in December. It has set up a committee to audit UC RUSAL and two other foreign miners, including AngloGold Ashanti.
Mines Minister Mahmoud Thiam said in May that figures seen by the government indicated Friguia was sold at around $20 million, far below independent valuations of $250 million.
