US waives sanctions on Russian owner of Aughinish Alumina

Ireland had argued that sanctions would adversely affect global aluminium markets

The Aughinish Alumina Refinery on the Shannon Estuary near Foynes Co Limerick.

The Aughinish Alumina Refinery on the Shannon Estuary near Foynes Co Limerick.

 

The US Treasury has waived sanctions on Rusal, the Russian energy giant which owns Aughinish Alumina in Limerick, in a move that has been welcomed by the Irish Government.

The Treasury Department announced on Sunday that it is removing restrictions on Rusal, EN+ Group Plc and EuroSibEnergo JSC.

The development, which had been expected, follows the failure of an effort by Democrats to veto the move in Congress 10 days ago. The Trump administration’s decision to exempt three companies controlled by Russian oligarch Oleg Deripaska had faced fierce resistance among Democrats, who are concerned about the administration’s ties with Russia.

But Ireland and other EU countries argued that the sanctions would adversely affect the European and hence global aluminium markets, as well as impact the Aughinish plant, the largest alumina plant in Europe.

In the statement on Sunday, the US Treasury said that the three companies in question had “agreed to unprecedented transparency for Treasury into their operations by undertaking extensive, ongoing auditing, certification, and reporting requirements”.

Mr Deripaska’s stake in the company has been reduced to below 50 per cent as part of the agreement, while all sanctions on Mr Deripaska as an individual remain in force.

Tánaiste and Minister for Foreign Affairs Simon Coveney welcomed the development.

‘Unacceptable actions’

“As I have made clear before, the Government has always fully understood the rationale behind these US sanctions,” he said. “We share the view that unacceptable actions by the Russian regime, and those connected to it, should not go unpunished. At the same time, we have been determined that legitimate measures taken by the US authorities do not cause inadvertent damage to Irish companies like Aughinish Alumina.”

Minister for Business, Enterprise and Innovation, Heather Humphreys, said the development was positive news for the company, which is one of the biggest direct and indirect employers in the Shannon estuary area.

“The confirmation today that Aughinish Alumina is no longer directly impacted by the US sanctions imposed in April 2018 is positive news for the company, its hard-working employees and the Mid-West region as a whole,” she said. “The firm can now focus again instead on its core business and future growth.”

The Irish embassy in Washington has been working extensively behind the scenes with other EU countries and the EU mission in Washington to convince the Treasury and Congress to lift the sanctions on Rusal.

Ireland’s Ambassador to the United States, Dan Mulhall, said: “I am delighted that the threat to the 700 jobs at Aughinish has been lifted. This is the culmination of nine months of effort on the part of the Embassy in conjunction with and under the direction of the Tánaiste and many colleagues in Dublin.”

Though the sanctions were introduced in April 2018, in December the White House announced that the three companies controlled by Deripaska would be lifted.

While Congress threatened to veto the move, a resolution opposing the measure failed to pass in the Senate in a vote on January 16th.

Though 11 Republicans broke ranks with the Trump administration and voted with Democrats on the matter, only 57 senators voted in favour of the resolution. The resolution needed 60 votes to pass.