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Revision as of 23:47, 24 March 2021 editSasha-int (talk | contribs)165 edits Made factual updates, included recent references to credible sources, checked facts and figures, verified links.Tags: Reverted Visual edit← Previous edit Revision as of 02:38, 25 March 2021 edit undoSasha-int (talk | contribs)165 edits Made factual updates as of March 2021, ensuring accuracy and cross-checked, referencing to credible media reports, refreshed links. Edited and cleaned up to bring in line with Misplaced Pages standards to make it tidy and readable.Tags: Reverted Visual editNext edit →
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| location_country = ] | location_country = ]
| area_served = Worldwide | area_served = Worldwide
| key_people = *Vladimir Rashevsky (]) | key_people = *Samir Brikho (])
*Vladimir Rashevsky (])
*Kuzma Marchuk (]) *Kuzma Marchuk (])
| industry = ] | industry = ]
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| homepage = {{URL|www.eurochemgroup.com}} | homepage = {{URL|www.eurochemgroup.com}}
}} }}
'''EuroChem''' ({{lang-ru|ЕвроХим}}) is a global producer of commodity and specialty fertilizers. It is one of the world’s three largest fertilizer manufacturers with its own capacity in all three primary nutrients – nitrogen, phosphates and potash<ref>{{Cite web|title=Fitch Affirms Eurochem at 'BB'; Outlook Stable|url=https://www.fitchratings.com/research/corporate-finance/fitch-affirms-eurochem-at-bb-outlook-stable-25-10-2019|url-status=live|access-date=2021-03-24|website=Fitch Ratings}}</ref><ref name=":0">{{Cite web|title=EuroChem Group AG - Company Profile and News|url=https://www.bloomberg.com/profile/company/1210954D:SW|access-date=2021-03-24|website=Bloomberg.com|language=en}}</ref>. It is the fourth largest fertilizer producer globally by revenue<ref name=":1">{{Cite web|title=Reports and results - EuroChem Group|url=https://www.eurochemgroup.com/investors/reports-results/,%20https://www.eurochemgroup.com/investors/reports-results/|access-date=2021-03-24|website=www.eurochemgroup.com|language=en-US}}</ref><ref>{{Cite web|title=Fertilizer Market Investment Analysis {{!}} Yara, Mosaic, PotashCorp, Eurochem – Cabell Standard|url=https://www.cabellstandard.com/uncategorized/180566/fertilizer-market-investment-analysis-yara-mosaic-potashcorp-eurochem/|access-date=2021-03-24|language=en-US}}</ref>. '''EuroChem''' ({{lang-ru|ЕвроХим}}) is a global producer of commodity and specialty fertilizers. It is one of the world’s three largest fertilizer manufacturers with its own capacity in all three primary nutrients – nitrogen, phosphates and potash<ref name=":4">{{Cite web|title=Fitch Affirms Eurochem at 'BB'; Outlook Stable|url=https://www.fitchratings.com/research/corporate-finance/fitch-affirms-eurochem-at-bb-outlook-stable-25-10-2019|url-status=live|access-date=2021-03-24|website=Fitch Ratings}}</ref><ref name=":0">{{Cite web|title=EuroChem Group AG - Company Profile and News|url=https://www.bloomberg.com/profile/company/1210954D:SW|access-date=2021-03-24|website=Bloomberg.com|language=en}}</ref>. It is the fourth largest fertilizer producer globally by revenue<ref name=":1">{{Cite web|title=Reports and results - EuroChem Group|url=https://www.eurochemgroup.com/investors/reports-results/,%20https://www.eurochemgroup.com/investors/reports-results/|access-date=2021-03-24|website=www.eurochemgroup.com|language=en-US}}</ref><ref>{{Cite web|title=Fertilizer Market Investment Analysis {{!}} Yara, Mosaic, PotashCorp, Eurochem – Cabell Standard|url=https://www.cabellstandard.com/uncategorized/180566/fertilizer-market-investment-analysis-yara-mosaic-potashcorp-eurochem/|access-date=2021-03-24|language=en-US}}</ref>.


It is headquartered in ], ]<ref name=":0" />. EuroChem has manufacturing, logistic and distributing facilities in Russia, Belgium, Lithuania, Brazil, China, Kazakhstan, Estonia, Germany and the USA. According to its Annual Report, in 2019, EuroChem made more than 100 products, which are sold in more than 100 countries<ref name=":1" />. EuroChem has over 27,000 employees worldwide<ref name=":2">{{Cite web|date=2021-02-09|title=FY 2020 IFRS RESULTS - EuroChem Group|url=https://www.eurochemgroup.com/media-announcements/fy-2020-ifrs-results/,%20https://www.eurochemgroup.com/media-announcements/fy-2020-ifrs-results/|access-date=2021-03-24|website=www.eurochemgroup.com|language=en-US}}</ref>. It is headquartered in ], ]<ref name=":0" />. EuroChem has manufacturing, logistic and distributing facilities in Russia, Belgium, Lithuania, Brazil, China, Kazakhstan, Estonia, Germany and the USA. According to its Annual Report, in 2019, EuroChem made more than 100 products, which are sold in more than 100 countries<ref name=":1" />. EuroChem has over 27,000 employees worldwide<ref name=":2">{{Cite web|date=2021-02-09|title=FY 2020 IFRS RESULTS - EuroChem Group|url=https://www.eurochemgroup.com/media-announcements/fy-2020-ifrs-results/,%20https://www.eurochemgroup.com/media-announcements/fy-2020-ifrs-results/|access-date=2021-03-24|website=www.eurochemgroup.com|language=en-US}}</ref>.
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The company's production facilities are located in Russia, ], ] and China. It has mining activities in ], ], Russia, ], ], Russia, ], ], Russia, and ], ].<ref name=":3">{{Cite web|title=Global operations - EuroChem Group|url=https://www.eurochemgroup.com/about-us/global-operations/,%20https://www.eurochemgroup.com/about-us/global-operations/|access-date=2021-03-24|website=www.eurochemgroup.com|language=en-US}}</ref> The company's production facilities are located in Russia, ], ] and China. It has mining activities in ], ], Russia, ], ], Russia, ], ], Russia, and ], ].<ref name=":3">{{Cite web|title=Global operations - EuroChem Group|url=https://www.eurochemgroup.com/about-us/global-operations/,%20https://www.eurochemgroup.com/about-us/global-operations/|access-date=2021-03-24|website=www.eurochemgroup.com|language=en-US}}</ref>


According to the company, it is one of the world’s leading producers of nitrogen, phosphate, potash and complex fertilizers. In 2020, EuroChem had sales revenues of US$6,2bn, of which nitrogen US$1.9bn, phosphate US$2.4bn and potash US$0.6bn<ref name=":2" />. According to the company, it is one of the world’s top-5 leading producers of nitrogen, phosphate, potash and complex fertilizers<ref name=":5">{{Cite news|date=2019-09-03|title=EuroChem CEO Ostbo Sees Growth From Core Market, Not Specialties|language=en|work=Bloomberg.com|url=https://www.bloomberg.com/news/articles/2019-09-03/eurochem-ceo-ostbo-sees-growth-from-core-market-not-specialties|access-date=2021-03-25}}</ref>. In 2020, EuroChem had sales revenues of US$6,2bn, of which nitrogen US$1.9bn, phosphate US$2.4bn and potash US$0.6bn<ref name=":2" />.


== Assets == == Assets ==
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* EuroChem-Usolskiy Potash Complex - Verkhnekamskoe Deposit, Perm region (potash) * EuroChem-Usolskiy Potash Complex - Verkhnekamskoe Deposit, Perm region (potash)


⚫ '''''Sales &'' ''Distribution'''''
'''OTHER:'''

⚫ ''Sales &'' ''Distribution''
* Owned and independent sales distribution network across five world regions: Europe, Russia & CIS, North America, Latin America and Asia. * Owned and independent sales distribution network across five world regions: Europe, Russia & CIS, North America, Latin America and Asia.

''Logistics''
* Port, rail, sea freight


==Ownership== ==Ownership==
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==Business== ==Business==


=== Acquisitions === === Milestones ===
According to S&P Global Market Intelligence (formerly SNL Financial), when EuroChem was founded 20 years ago, "the company was not much more than a pair of Soviet-era nitrogen plants and a dust bowl phosphate mine facing closure" but it was quickly transformed into Russia's biggest fertilizer producer and one of the world's largest largest high-tech fertilizer manufacturers.<ref name=":6">{{Cite web|date=2015-05-05|title=EuroChem’s expansion into mining could double company size, boost it to top 5 potash player - EuroChem Group|url=https://www.eurochemgroup.com/eurochems-expansion-into-mining-could-double-company-size-boost-it-to-top-5-potash-player/,%20https://www.eurochemgroup.com/eurochems-expansion-into-mining-could-double-company-size-boost-it-to-top-5-potash-player/|access-date=2021-03-25|website=www.eurochemgroup.com|language=en-US}}</ref>


One of EuroChem’s key enterprises, Novomoskovsky Azot, became the largest urea plant in Europe, where production of granulated urea began for the first time in Russia. In addition to existing facilities, new modern manufacturing facilities were built in Nevinnomyssk (including the first melamine production plant in Russia) and Kovdor (including an apatite and shtaffelite ores processing complex).
====Murmansk Commercial Sea Port====
On 24 April 2013 EuroChem finalised the acquisition of a 47.67% interest in the share capital of OJSC "Murmansk Commercial Seaport" represented by 53,943 voting shares for {{Russian ruble|link=Russian ruble}}3,113,859,000. The Group made a prepayment of {{Russian ruble|link=Russian ruble}}2,522,755,000 for the acquisition of a 38.62% interest representing 43,703 voting shares in December 2012 and in April 2013 additionally acquired a 9.05%, interest representing 10,240 voting shares, for {{Russian ruble|link=Russian ruble}}591,104,000.<ref>{{cite web|url=http://www.eurochem.ru/wp-content/uploads/2013/05/EuroChem_FS_3M_2013_EN.pdf/|publisher=Eurochem.ru|title=EuroChem Consolidated IFRS Accounts for the 3 months ended 31 March 2013|accessdate=2014-02-22|archive-url=https://web.archive.org/web/20140421105411/http://www.eurochem.ru/wp-content/uploads/2013/05/EuroChem_FS_3M_2013_EN.pdf|archive-date=21 April 2014|url-status=dead|df=dmy-all}}</ref> Russian Financial Control Monitor on 26 April 2013 quoted EuroChem's CEO who commented on the transaction and said that "the price is comparable to recent privatisation deals of similar assets and the purchase was made in the open market".


Eurochem bought its first potash mining license in 2005, to develop Gremyachinskoe deposit, located near the town of Kotelnikovo, southwest of Volgograd. It followed up with the purchase of another license area a few years later - the Verkhnekamskoe deposit near Berezniki, Russia's potash stronghold, in 2008. Usolskiy Potash Project produced 2.223 MMT of potash in 2020<ref name=":1" />.
The privatisations of the port began in late 2012, with SUEK – a mining company controlled by Andrey Melnichenko – acquiring a 24.95% stake. At the beginning of April 2013 it purchased a further 24.91% increasing its stake to 49.86%. As a result of EuroChem's acquisition the two companies controlled by Melnichenko own 97.53% of the Murmansk port. On 26 April 2013 the Russian information agency Interfax reported that EuroChem plans to make a mandatory offer to purchase the remaining shares from minority shareholders thus becoming a majority owner of the port.<ref>{{cite web|url=http://connection.ebscohost.com/c/articles/87327716/eurochem-plans-offer-minority-shareholders-murmansk-port |archive-url=https://web.archive.org/web/20131112180236/http://connection.ebscohost.com/c/articles/87327716/eurochem-plans-offer-minority-shareholders-murmansk-port |url-status=dead |archive-date=2013-11-12 |title=Eurochem plans offer to minority shareholders in Murmansk port |publisher=Connection.ebscohost.com |date= |accessdate=2014-02-22}}</ref>


According to Clark Bailey, former managing director of the mining division at Eurochem, the company's philosophy for growth was "vertical integration — from the original mineral, to transportation, all the way to the guy who uses it on the field," as well as "to go upstream and to be self-sufficient in all the raw materials".<ref name=":6" />
====EuroChem Agro (K+S Nitrogen)====
In July 2012, EuroChem completed the acquisition of K+S Nitrogen, a company marketing nitrogenous fertilizers with a focus on major customers in agriculture and special crops such as fruits, vegetables and grapes. In addition to the fertilizers produced by EuroChem Antwerpen and delivered by BASF, K+S Nitrogen also marketed the goods of other European fertilizer producers. K+S Nitrogen was subsequently renamed EuroChem Agro and is based in Mannheim, Germany.<ref>{{Cite web |url=http://www.k-plus-s.com/en/news/presseinformationen/2012/presse-120702.html/ |title=Archived copy |access-date=11 December 2013 |archive-url=https://web.archive.org/web/20160419135028/http://www.k-plus-s.com/en/news/presseinformationen/2012/presse-120702.html |archive-date=19 April 2016 |url-status=dead }}</ref>


In Kazakhstan, the company started mining phosphate rock from its Kok-Jon mine in the southeast of the country. Eurochem bought out the Kazakh government's stake in Sary-Tas, a Soviet-era fertilizer plant near Karatau, in the south of the country. The plant had been mothballed since the 1990s, but Eurochem modernized the facilities and built new plants to produce cheap fertilizer for sale in China, India, central Asia and Russia. The company also produces iron ore from its Kovdorsky mine near Murmansk, which is "byproduct", with the majority of the output bought by Chinese buyers<ref name=":6" />.
====EuroChem Antwerpen (BASF fertiliser assets)====
] sold its fertilizers activities in ], Belgium, to EuroChem on March 31, 2012.<ref>{{cite web |url=http://www.eurochem.ru/2012/04/eurochem-completes-acquisition-of-basfs-fertilizer-assets/ |title=Press releases Archives - EuroChem |publisher=Eurochem.ru |accessdate=2014-02-22 |archive-url=https://web.archive.org/web/20120822010339/http://www.eurochem.ru/2012/04/eurochem-completes-acquisition-of-basfs-fertilizer-assets/ |archive-date=22 August 2012 |url-status=dead |df=dmy-all }}</ref>


According to Bloomberg, "the acquisition of a BASF SE plant in Antwerp by EuroChem for 830 million euros ($930 million) brought in new technologies" for the company. ] sold its fertilizers activities in ], Belgium, to EuroChem on March 31, 2012.<ref>{{cite web|title=Press releases Archives - EuroChem|url=http://www.eurochem.ru/2012/04/eurochem-completes-acquisition-of-basfs-fertilizer-assets/|url-status=dead|archive-url=https://web.archive.org/web/20120822010339/http://www.eurochem.ru/2012/04/eurochem-completes-acquisition-of-basfs-fertilizer-assets/|archive-date=22 August 2012|accessdate=2014-02-22|publisher=Eurochem.ru|df=dmy-all}}</ref> In July 2012, EuroChem completed the acquisition of K+S Nitrogen, a company marketing nitrogenous fertilizers with a focus on major customers in agriculture and special crops such as fruits, vegetables and grapes<ref>{{Cite web|date=2016-04-19|title=K+S Group - EuroChem Completes Acquisition of K+S Nitrogen|url=https://web.archive.org/web/20160419135028/http://www.k-plus-s.com/en/news/presseinformationen/2012/presse-120702.html|access-date=2021-03-25|website=web.archive.org}}</ref>.
====Severneft-Urengoy====
On 19 January 2012 EuroChem acquired Severneft-Urengoy, an oil and gas operator with exploration licenses for gas fields in the Yamalo-Nenets Autonomous District in the North of Russia for US$403 million. The acquisition is part of the company's back integration strategy to meet raw material requirements with its own supply. At full capacity, Severneft-Urengoy could produce enough natural gas to meet close to a quarter of EuroChem's annual requirements. Natural gas is the primary raw material used to produce ammonia, the main building-block for nitrogen-based fertilisers.,<ref>{{cite web|last=Khrennikov |first=Ilya |url=https://www.bloomberg.com/news/2012-01-20/eurochem-acquires-russian-gas-producer-severneft-urengoy-for-212-million.html |title=EuroChem Buys Russian Gas Producer for $403 Million |publisher=Bloomberg |date=2012-01-20 |accessdate=2014-02-22}}</ref><ref name="eurochem.ru">{{cite web |url=http://www.eurochem.ru/news/investor-news/#/single-news/eurochem-acquires-natural-gas-operator/ |title=Investor news Archives - EuroChem |publisher=Eurochem.ru |accessdate=2014-02-22 |archive-url=https://web.archive.org/web/20140228054634/http://www.eurochem.ru/news/investor-news/#/single-news/eurochem-acquires-natural-gas-operator/ |archive-date=28 February 2014 |url-status=dead |df=dmy-all }}</ref>


⚫ In 2013, EuroChem established a joint venture with ] fertiliser producer Migao in order to increase its presence in ], producing ] and chloride-free complex fertilizers<ref>{{Cite web|url=https://www.ft.com/content/c9b9066f-3386-3975-8310-c4a60b097fba|title=Eurochem: looking to China with Migao|last=|first=|date=|website=Financial Times|language=en-GB|access-date=2019-09-25}}</ref><ref>{{Cite news|url=https://uk.reuters.com/article/russia-eurochem-migao-idUKL6N0FZ0OB20130729|title=Russia's Eurochem plans joint venture with China's Migao|date=2013-07-29|work=Reuters|access-date=2019-09-25|language=en}}</ref><ref>{{Cite web|url=https://investorintel.com/sectors/agribusiness-mmj/agbusiness-mmj-news/eurochem-migao-establish-joint-venture-china/|title=EuroChem and Migao Establish Joint Venture in China|date=2013-11-28|website=InvestorIntel|language=en|access-date=2019-09-25}}</ref>.
====Karbamid 2====
In March 2008 EuroChem purchased a carbamide production unit, Karbamid 2, from Azotara Pancevo for €32.5 million. The plant was subsequently disassembled and shipped to Russia. The €32.5 million proceeds from the sale of the fertiliser plant are reported to have gone missing. Azotara-Pancevo's former management is currently under investigation for fraud and mismanagement in relation to the company's privatisation and sale of Karbamid 2 to EuroChem. Charges of organised criminal activity have been lodged against the consortium's management and various allegations of fraud are being investigated. An international arrest warrant has also been issued for the Lithuanian Chief Financial Officer who signed off Karbamid 2's sale.<ref>{{cite web|url=http://www.blic.rs/Vesti/Hronika/297603/Interpol-traga-za-Litvancem |title=Blic Online &#124; Interpol traga za Litvancem |publisher=Blic.rs |date= |accessdate=2014-02-22}}</ref>


⚫ EuroChem’s US$1 billion ammonia plant, EuroChem Northwest, in Kingisepp, Russia, launched in June 2019, has a production capacity of 1 million tonnes (1MMT) per year, ensuring EuroChem’s full self-sufficiency in ammonia. The company approved the construction of EuroChem Northwest 2, a new 1.1 MMT ammonia and 1.4 MMT urea plant, on an adjacent site in Kingisepp, Russia<ref name=":1" /><ref>{{Cite web|url=https://www.worldfertilizer.com/project-news/01102019/eurochem-and-maire-tecnimont-sign-memorandum-of-intent-for-potential-new-urea-and-ammonia-plant/|title=EuroChem and Maire Tecnimont sign memorandum of intent for potential new urea and ammonia plant|date=2019-10-01|website=World Fertilizer|language=en|access-date=2019-10-31}}</ref>.
====OJSC Sary-Tas====
In November 2008 EuroChem acquired 56.33% of the Kazakh owned share capital of OJSC Sary-Tas in Zhambyl region (southern Kazakhstan). The phosphorite pellets production plant ceased production in 1993. EuroChem says it is building a new plant on the site investing over US$2.5 billion.<ref>{{cite web|url=http://www.eurochem.ru/wp-content/uploads/2013/02/SR2008.pdf |title=Social Responsibility Atlas 2008 |publisher=Eurochem.ru |accessdate=2014-02-22}}</ref> Andrey Melnichenko has asked the Kazakh government to provide cheap gas for the project.<ref>{{cite web|url=http://www.inright.ru/articles/nation/20111109/id_683|language=ru|title=Андрей Мельниченко. Прибыль на людях|trans-title=Profit on People|first1=Andrey|last1=Melnichenko|date=2011-11-09|access-date=2017-04-18|website=inright.ru}}</ref>


==Environment==
=== Joint ventures ===
⚫ In July 2013, EuroChem announced plans to establish a joint venture with ] fertiliser producer Migao in order to increase its presence in ].<ref>{{Cite news|url=https://uk.reuters.com/article/russia-eurochem-migao-idUKL6N0FZ0OB20130729|title=Russia's Eurochem plans joint venture with China's Migao|date=2013-07-29|work=Reuters|access-date=2019-09-25|language=en}}</ref> The joint venture was established in November that year and was expected to produce 60,000 tonnes of ] and up to 200,000 tonnes of chloride-free complex fertilizers.<ref>{{Cite web|url=https://investorintel.com/sectors/agribusiness-mmj/agbusiness-mmj-news/eurochem-migao-establish-joint-venture-china/|title=EuroChem and Migao Establish Joint Venture in China|date=2013-11-28|website=InvestorIntel|language=en|access-date=2019-09-25}}</ref> The 50:50 joint venture also planned to launch new production units in 2014.<ref>{{Cite web|url=https://www.ft.com/content/c9b9066f-3386-3975-8310-c4a60b097fba|title=Eurochem: looking to China with Migao|last=|first=|date=|website=Financial Times|language=en-GB|access-date=2019-09-25}}</ref>


=== Technology ===
⚫ In October 2019, EuroChem signed a memorandum of intent with ] for a potential new urea and ammonia production facility in ]. Maire Tecnimont is undertaking "preliminary engineering and site surveying work" in order to ascertain the project's viability.<ref>{{Cite web|url=https://www.worldfertilizer.com/project-news/01102019/eurochem-and-maire-tecnimont-sign-memorandum-of-intent-for-potential-new-urea-and-ammonia-plant/|title=EuroChem and Maire Tecnimont sign memorandum of intent for potential new urea and ammonia plant|date=2019-10-01|website=World Fertilizer|language=en|access-date=2019-10-31}}</ref>
According to Bloomberg, the company has closed water or steam recycling at its facilities. It uses a technology which limits the water vapour release and enables byproduct heat to warm its fertilizers.<ref name=":5" />


According to the company, Eurochem produces specialty fertilisers that allow slow release of nutrients into crops which limits adverse environmental impact. Its enhanced-efficiency fertilisers (EEFs) reduce nitrogen leaching into soil, decrease greenhouse gas (GHG) and hazardous emissions (nitrous oxide, ammonia) into the air and water upon application<ref>{{Cite web|date=2019-01-15|title=Fertiliser Focus, January/February 2019 edition - EuroChem Group|url=https://www.eurochemgroup.com/fertiliser-focus-january-february-2019-edition/,%20https://www.eurochemgroup.com/fertiliser-focus-january-february-2019-edition/|access-date=2021-03-25|website=www.eurochemgroup.com|language=en-US}}</ref>.
== Reorganisation ==
On 5 December 2012 Prime News reported that EuroChem planned to set up another unit outside of Russia, acting as the guarantor of the company's ] and which could later operate the company's potash and gas projects. Referred to as "Topco" (i.e. top holding company) it would own at least 70% of EuroChem's debt and thus become a core unit in the corporate structure of the group.<ref>{{cite web|url=http://www.1prime.biz/news/_Russias_EuroChem_to_set_up_new_core_unit_abroad/0/%7BCAAA900F-903A-4F5B-B451-3515D69C100A%7D.uif |title=Russia's EuroChem to set up new core unit abroad - All News - PRIME Business News Agency - All News Politics Economy Business Wire Financial Wire Oil Gas Chemical Industry Power Industry Metals Mining Pulp Paper Agro Commodities Transport Automobile Construction Real Estate Telecommunications Engineering Hi-Tech Consumer Goods Retail Calendar Our Features Interviews Opinions Press Releases |publisher=1prime.biz |date= |accessdate=2014-02-22}}</ref>


Its fertilizer, Entec 26, was recognized by a carbon exchange foundation in Switzerland, marking the first time the contribution of advanced fertilizers to reducing agricultural emissions was acknowledged<ref>{{Cite web|title=Climate Investment Programs with First Climate Switzerland|url=https://www.firstclimate.com/en/climate-investment-programs/|access-date=2021-03-25|website=First Climate|language=en-US}}</ref>.
On 3 October 2014, EuroChem Group AG was established, a new holding company for the Group. The new holding company is a wholly owned subsidiary of EuroChem Group SE (Cyprus) and based in Zug, Switzerland. The new EuroChem Group AG Board of Directors was formed in April 2015.<ref>{{Cite web|url=https://www.eurochemgroup.com/media-announcements/eurochem-group-ag-forms-board-of-directors-after-corporate-reorganisation/|title=EuroChem Group AG forms Board of Directors after corporate reorganisation|date=2015-04-24|website=EuroChem Group|language=en-US|access-date=2019-09-25}}</ref>


EuroChem cooperated with Coca-Cola and other beverage companies at its nitrogen plants capturing CO2 produced each year and processing it using state-of-the-art purification technology to supply for production of carbonated drinks.<ref name=":5" /><ref>{{Cite web|title=EuroChem to Begin Food-Grade Carbon Dioxide Production in Russia for Coca-Cola Systems|url=https://www.chemmarket.info/en/news/view/36435/|access-date=2021-03-25|website=www.chemmarket.info}}</ref>
==HSE Issues==
===Chemical spillage===
In 2010 EuroChem began constructing a bulk port terminal in ] in the south of Russia. The local environmental organisations accused EuroChem of federal law violation since the construction was taking place in a residential zone. In March 2010, there were reports of a spillage of chemicals at EuroChem's Tuapse terminal while EuroChem was testing the loading of chemical fertilizers onto a tanker. The spillage was later blamed by ecologists for the death of four dolphins at Sochi. Local residents reported a substantial deterioration of air quality claiming that this resulted from the emission at the EuroChem terminal. The local resident's concerns soon led to protests in May 2010 of around 3,000 people against EuroChem.<ref>{{cite web|url=http://www.novayagazeta.ru/news/1911.html |title=Туапсе. Массовое отравление горожан вызвало волну протеста против компании "ЕвроХим" - Новости - Новая Газета |publisher=Novayagazeta.ru |date=2010-05-18 |accessdate=2014-02-22}}</ref> EuroChem denied the company bore any responsibility for the alleged deterioration of air quality in the city.<ref>{{cite web |url=http://gazeta.tuapse.ru/?subaction=showfull&id=1270114500&archive=&cnshow=news&start_from=&ucat= |title=Новости |publisher=Gazeta.tuapse.ru |accessdate=2014-02-22 |archive-url=https://archive.today/20131115164820/http://gazeta.tuapse.ru/?subaction=showfull&id=1270114500&archive=&cnshow=news&start_from=&ucat= |archive-date=15 November 2013 |url-status=dead |df=dmy-all }}</ref> In spite of the denials, EuroChem CEO Dmitri Sterzhnev admitted at a press conference following the protests, that during the test drive of the terminal, the company had in fact violated administrative law and had paid a fine as a result. In June 2011 information about the protests reached Medvedev, who was president at the time and he personally ordered to postpone the launch of Eurochem's terminal in Tuapse.<ref>{{cite web|url=http://sochi-24.ru/politika/dmitrij-medvedev-otlozhil-zapusk-himterminala-v-tuapse.2011625.34409.html |title=дЛХРПХИ лЕДБЕДЕБ НРКНФХК ГЮОСЯЙ УХЛРЕПЛХМЮКЮ Б рСЮОЯЕ — янвх 24 |publisher=Sochi-24.ru |date= |accessdate=2014-02-22}}</ref>


⚫ === The Baltic Sea ===
A series of lawsuits was brought by environmental organizations as well as by local residents in district and regional courts. Ultimately the Krasnodar regional court, supported by an expert from the regional unit of Rospotrebnadzor, the state environmental watchdog, ruled in August 2011 that the construction was lawful.<ref>{{cite web|url=http://tbt-tuapse.ru/docs/17/ |title=Судебные решения |publisher=Tbt-tuapse.ru |date= |accessdate=2014-02-22}}</ref> The construction of the terminal has now been completed and the port is operating.<ref>{{cite web|author= |url=http://kuban.mk.ru/article/2011/08/03/611273-strasti-po-terminalu.html |title=Страсти по терминалу - МК на Кубани (Краснодар) МК |publisher=Kuban.mk.ru |date=1907-07-07 |accessdate=2014-02-22}}</ref>
EuroChem’s US$1 billion ammonia plant, EuroChem Northwest, in Kingisepp, Russia, officially launched in June 2019, was built on a brownfield site and features a closed water recycling system to prevent water discharge into the Baltic Sea. It uses 75% of waste water from EuroChem’s Phosphorit phosphate plant nearby<ref>{{Cite web|date=2019-06-07|title=EuroChem opens new $1bn ammonia plant in Kingisepp, Russia - EuroChem Group|url=https://www.eurochemgroup.com/media-announcements/eurochem-opens-new-1bn-ammonia-plant-in-kingisepp-russia/,%20https://www.eurochemgroup.com/media-announcements/eurochem-opens-new-1bn-ammonia-plant-in-kingisepp-russia/|access-date=2021-03-25|website=www.eurochemgroup.com|language=en-US}}</ref>.


The Helsinki-based John Nurminen Foundation, a Finnish foundation specialized in Baltic Sea protection, has been working with EuroChem on the Baltic Sea ecology since 2012<ref>{{Cite web|date=2019-05-29|title=EuroChem Clean Water Program - EuroChem Group|url=https://www.eurochemgroup.com/sustainability-story/reducing-water-use-and-effluent-discharges/,%20https://www.eurochemgroup.com/sustainability-story/reducing-water-use-and-effluent-discharges/|access-date=2021-03-25|website=www.eurochemgroup.com|language=en-US}}</ref><ref>{{Cite web|date=2018-05-23|title=Good results of the John Nurminen Foundation’s project in Russia: Effective cleaning of wastewater in the city of Kingisepp reduces phosphorus emissions to the Gulf of Finland by about 13 tonnes|url=https://johnnurmisensaatio.fi/en/good-results-of-the-john-nurminen-foundations-project-in-russia-effective-cleaning-of-wastewater-in-the-city-of-kingisepp-reduces-phosphorus-emissions-to-the-gulf-of-finland-by-about-13-tonnes/|access-date=2021-03-25|website=John Nurmisen Säätiö|language=en-US}}</ref>.
⚫ ===Baltic Sea===
According to preliminary Finnish research there is a ] leak in the ] in the volume of 1,000 tonnes annually. It may be from the ] waste piles of the EuroChem factory near ], although EuroChem has denied this.<ref>{{cite web|author=Vesa Sundqvist |url=http://yle.fi/uutiset/kotimaa/2012/03/venalaisyhtio_kiistaa_fosforipaastot_suomenlahteen_3314312.html |title=Venäläisyhtiö kiistää fosforipäästöt Suomenlahteen &#124; Yle Uutiset |publisher=yle.fi |date= |accessdate=2014-02-22}}</ref> In April 2012, Russian officials arrested environmental expert Seppo Knuuttila, who had been working on behalf of the ] and ]. He was interrogated for a total of fourteen hours by the officials, who demanded to have his computer at customs. Mr. Knuuttila was examining ] phosphate content, as agreed.<ref>{{cite web|author=Annamari Iranto |url=http://yle.fi/uutiset/kotimaa/2012/03/suomalaiset_paasevat_mittaamaan_eurochemin_fosforipaastoja_3330057.html |title=Suomalaiset pääsevät mittaamaan EuroChemin fosforipäästöjä &#124; Yle Uutiset |publisher=yle.fi |date= |accessdate=2014-02-22}}</ref><ref name=ylevenaja>{{cite web|url=http://yle.fi/uutiset/kotimaa/2012/04/venalaisviranomaiset_pidattivat_syken_tutkijan_pietarissa_3403942.html |title=Venäläisviranomaiset pidättivät Syken tutkijan &#124; Yle Uutiset |publisher=yle.fi |date= |accessdate=2014-02-22}}</ref>


⚫ ==Financing==
The findings of an investigation by HELCOM, the international ecological association, found Phosphorit in all likelihood responsible for the pollution. Specifically HELCOM accused EuroChem of improperly monitoring phosphorus runoff from its Phosphorit facility, an issue that was also discussed in the Finnish press in January 2012. The Finnish-Russia cooperation on reducing phosphorus in the Baltic Sea is ongoing indicating the ecological problem is still present.
⚫ In April 2013 the Russian newspaper Vedomosti reported that EuroChem was looking to take a loan of US$700 million to finance its current development projects.<ref>{{cite web|url=http://www.vedomosti.ru/newspaper/article/429161/milliard_dlya_evrohima |title=ВЕДОМОСТИ - Миллиард для "Еврохима" |publisher=Vedomosti.ru |date= |accessdate=2014-02-22}}</ref> In August 2013, EuroChem announced that it has signed a new debut US$1,3 billion unsecured loan facility on a club basis. The proceeds were used to pay down the outstanding amount under EuroChem's 2011 US$1.3 billion pre-export facility.<ref>{{cite web |url=http://www.eurochem.ru/news/press-releases/#/single-news/eurochem-secures-debut-unsecured-us1300000000-facility/ |title=Press releases Archives - EuroChem |publisher=Eurochem.ru |accessdate=2014-02-22 |archive-url=https://web.archive.org/web/20131105133513/http://www.eurochem.ru/news/press-releases/#/single-news/eurochem-secures-debut-unsecured-us1300000000-facility/ |archive-date=5 November 2013 |url-status=dead }}</ref>


S&P Global Market Intelligence (formerly SNL Financial) reported in 2015 that "the company has managed to tap investors in recent years, including a US$750 million project finance facility, a US$1.3 billion syndicated loan and a US$750 million Eurobond issue". According to Olivier Harvey, head of investor relations at the company, "despite the whopping US$7 billion price tag for both potash projects, much of the outlay can be funded over time by Eurochem's free cash flows", while "the devaluation of the Russian ruble was delivering huge cost savings to the company's CapEx program."<ref name=":6" />
The Helsinki-based John Nurminen Foundation, a Finnish foundation specialized in Baltic Sea protection, has been working with EuroChem on the Baltic Sea phosphorus monitoring and reduction program.


According to Fitch, in 2016, Eurochem "signed an agreement for a perpetual shareholder loan of up to USD1 billion" noting that its "diversification into all three nutrients (nitrogen, phosphate and potash), vertical integration and strong cost position support a business profile commensurate with an investment grade rating" and that its scale "is on a par with that of large fertiliser peers" such as ] et al.<ref name=":4" />.
In June 2012, EuroChem and the John Nurminen Foundation agreed to jointly appoint an independent organization to assess the effectiveness and sustainability of the surface water run-off treatment system which was constructed at the Phosphorit factory in March 2012. The system was constructed to purify phosphorus containing surface water run-off, originating in the area adjacent to the factory. In July 2013, the John Nurminen Foundation and EuroChem jointly appointed Atkins, a design, engineering and project management consultancies, to assess a surface run-off treatment system near the Phosphorit fertilizer facility and to conduct monitoring of the Luga River. Atkins will also monitor phosphorus concentrations in the Luga River upstream and downstream of the factory for one year, and calculate river phosphorus loads to the Baltic Sea.<ref>{{cite web |url=http://www.puhdasitameri.fi/en/uutiset/eurochem-and-the-john-nurminen-foundation-select-atkins-to-carry-out-independent-audit-on-surface-run-off-treatment-in-luga-river-in-kingisepp-russia |title=EuroChem and the John Nurminen Foundation select Atkins to carry out independent audit on surface run-off treatment in Luga River in Kingisepp, Russia |publisher=Puhdasitameri.fi |date=2013-07-30 |accessdate=2014-02-22 |archive-url=https://archive.today/20131211091059/http://www.puhdasitameri.fi/en/uutiset/eurochem-and-the-john-nurminen-foundation-select-atkins-to-carry-out-independent-audit-on-surface-run-off-treatment-in-luga-river-in-kingisepp-russia |archive-date=11 December 2013 |url-status=dead |df=dmy-all }}</ref>


⚫ In February 2017, ] revealed that EuroChem was not planning an IPO in the next few years as the company "has sufficient funds to independently finance its investment program<ref>{{Cite web|title=Melnichenko sees to point in IPO for EuroChem, SUEK yet|url=https://interfax.com/newsroom/top-stories/28967/|access-date=2021-03-24|website=interfax.com}}</ref>".
After having become concerned about the condition of the Baltic Sea in 2004, the Board of the John Nurminen Foundation consulted leading experts on the marine environment to find out if the Foundation could play a concrete role in protecting the Baltic Sea. According to the experts, the fastest and most cost-efficient method of improving the condition of the Baltic Sea would be to intervene in the operation of wastewater treatment plants located in its catchment area by intensifying their phosphorus removal. The three largest wastewater treatment plants in St. Petersburg were chosen as the first target. By making their phosphorus removal more effective, the Gulf of Finland's phosphorus load usable for algae can be reduced by almost 27%. According to the Finnish Environment Institute, this is the quickest and most cost-effective way to improve the open sea condition of the Gulf of Finland, when comparing all possible water protection measures in Finland and Russia. The measure will visibly reduce the algae growth in the Gulf of Finland after just a few years, provided that the other surrounding circumstances do not change considerably.<ref>{{cite web |url=http://www.puhdasitameri.fi/en/eutrophication-69 |title=Eutrophication |publisher=Puhdasitameri.fi |accessdate=2014-02-22 |archive-url=https://web.archive.org/web/20130411044810/http://www.puhdasitameri.fi/en/eutrophication-69 |archive-date=11 April 2013 |url-status=dead |df=dmy-all }}</ref>


In June 2018, Moody's assessed that it "positively notes that EuroChem has a contractual loan agreement with its majority shareholder, which allows it to attract up to $1 billion of a perpetual zero-interest loan to support its liquidity." It noted that, according to its rationale, EuroChem's strengths included: (1) the company's strong business profile, underpinned by its large scale of operations, diversified product mix, and established positions in the global and regional fertilizer markets; (2) sustainable cost competitiveness, which supports relatively high margins, additionally helped by the weakness of the rouble; (3) potential for deleveraging; and (4) proved access to long-term external funding, including a shareholder loan facility, which support liquidity<ref>{{Cite web|date=2018-06-13|title=Moody's assigns a Ba2 Corporate Family Rating to EuroChem; outlook stable|url=https://www.moodys.com/research/Moodys-assigns-a-Ba2-Corporate-Family-Rating-to-EuroChem-outlook--PR_385028|url-status=live|access-date=2021-03-25|website=Moody's}}</ref>.
===Worker fatalities===
In May 2009 a warehouse for mineral fertilizer at the Tuapse Buker Terminal partially collapsed killing two contractors present. An investigation into the accident was launched by regional authorities.<ref>{{cite web|url=http://www.interfax-russia.ru/south/news.asp?id=103958&sec=1672 |title=Новости - Юг и Северный Кавказ |publisher=interfax-russia.ru |date=2014-01-30 |accessdate=2014-02-22}}</ref>

===Fires===
In July 2012, two fires took place at the EuroChem's Nevinnomysski Azot, which is based in the Stavropol region in South-West Russia and primarily produces nitrogen-based fertilizers. According to Russian media no toxic emissions or injuries emanated from the fires.<ref>RIA Novosti, 3 August 2012</ref>


==Litigation== ==Litigation==


===Shaft sinkers=== ===Shaft Sinkers===
In 2012, Eurochem filed suit against Shaft Sinkers, the London-listed South African mining engineering company that had been contracted to construct the shafts at the EuroChem-VolgaKaliy potash site. Soon after starting work on the cage shaft, things started to go wrong; the grouting technology that Shaft Sinkers used failed, and the shaft later suffered water inflow. According to EuroChem's Clark Bailey, the failure and the flooding of the shaft that led to the lawsuit delayed completion at Volgakaliy project by more than two years<ref name=":6" />.
Following the early termination of a shaft construction contract,<ref>{{cite web|url=http://www.shaftsinkersgroup.com/Update%20on%20Eurochem%20Contract.aspx/ |accessdate=11 December 2013 |url-status=dead |archiveurl=https://web.archive.org/web/20120423015236/http://www.shaftsinkersgroup.com/Update%20on%20Eurochem%20Contract.aspx |archivedate=23 April 2012 }}</ref> in October 2012 EuroChem filed a claim against Shaft Sinkers (Pty) Ltd. (Shaft Sinkers), seeking US$800 million compensation for the direct costs and substantial lost profits arising from the delay in commencing potash production. This was a result of the alleged inability of Shaft Sinkers to fulfill its contractual obligations and complete the construction of the Gremyachinskoe cage shaft, primarily due to problems with the grouting technology. In October 2012 Shaft Sinkers presented an interim claim letter to the Group claiming compensation of US$45 million in costs incurred by them up to and inclusive of 30 September 2012 in connection with the termination of the construction contract. The above disputes are subject to arbitration as specified in the contract. An outstanding advance given to Shaft Sinkers of {{Russian ruble|link=Russian ruble}}495,387 thousand was written off during the nine months ended 30 September 2012. As well, due to the failure of the grouting technology employed in the cage shaft construction, expenses previously capitalised, amounting to {{Russian ruble|link=Russian ruble}}3.116 billion, were written-off during the nine months ended 30 September 2012.<ref>{{cite web|url=http://www.eurochem.ru/wp-content/uploads/2013/01/EuroChem_FS_9M_2012_ENG.pdf |publisher=EuroChem.ru|title=EuroChem Consolidated IFRS Accounts for the 9 months ended 30 September 2012|accessdate=14 November 2012}}</ref>

EuroChem lodged claims in the Dutch courts accusing International Mineral Resources (IMR), wholly owned by the ENRC trio of Alexander Machkevitch, Patokh Chodiev and Alijan Ibragimov, of "blatant fraud, exacerbated by bribery". EuroChem had previously said it was claiming damages of $800m (£500m) from its supplier Shaft Sinkers, which is 48% owned by IMR, following problems with a $2bn Russian potash mining project. In the new case, the fertiliser group alleges that an IMR executive bribed a EuroChem employee with hundreds of thousands of roubles to cover up the alleged ineffectiveness of Shaft Sinkers' work. It also claims IMR facilitated the concealment of a report that questioned whether Shaft Sinkers's sealing technology could be effective on the potash project.<ref>{{cite web|author=Simon Goodley and Joris Luyendijk |url=https://www.theguardian.com/business/2013/may/01/enrc-mineral-fraud-bribery-suit |title=ENRC founders face Dutch fraud lawsuit &#124; Business |publisher=The Guardian |date= |accessdate=2014-02-22}}</ref>

EuroChem obtained an interim freezing order covering more than €886.5m of assets belonging to International Mineral Resources (IMR), a company owned by the founders of ENRC. The order was granted pending a full trial by a Dutch court as part of a civil suit filed by EuroChem. It claims damages of €660m over fraud allegedly committed by an employee of Shaft Sinkers, the South African mine shaft excavator company in which IMR holds a 48 per cent stake.<ref>{{cite web|author= |url=http://www.ft.com/intl/cms/s/0/017aaeb4-f547-11e2-b4f8-00144feabdc0.html#axzz2n9Eb1N00 |title=EuroChem move freezes IMR assets |publisher=FT.com |date=2013-07-28 |accessdate=2014-02-22}}</ref>

Shaft Sinkers has dismissed as "nonsensical" the claim brought by EuroChem, Russia's third-largest fertiliser firm over the flooding of a mineshaft that delayed a $4 billion potash project.
<ref>{{cite web|url=https://www.reuters.com/article/2013/11/12/russia-potash-idUSL5N0IW0CL20131112 |title=Potash slump raises stakes in Russia legal battle |publisher=Reuters |date=2013-11-12 |accessdate=2014-02-22}}</ref>

The case is ongoing.

===Severneft-Urengoy===
On 19 January 2012 EuroChem acquired Severneft-Urengoy, an oil and gas operator with exploration licenses for gas fields in the Yamalo-Nenets Autonomous District in the North of Russia for US$403 million.<ref name="eurochem.ru"/>

In March 2013 "Reverta AS" filed a claim against LLC "NK Severneft" and LLC "Severneft-Urengoy" contesting the property purchase and sale transactions made between these two entities in 2011,
preceding the acquisition of LLC "Severneft-Urengoy" by the Group. As part of the proceeding, the court had issued a ruling to impose injunctive relief restricting the ability of LLC "Severneft-Urengoy" to dispose of certain property. The Group contested the restriction and in June 2013 the arbitration court dismissed the injunction.
The case had no bearing on the Group's activity.<ref>{{cite web|url=http://www.eurochem.ru/wp-content/uploads/2013/08/EuroChem_FS_06_2013.pdf/ |accessdate=11 December 2013 |url-status=dead |archiveurl=https://web.archive.org/web/20140421105712/http://www.eurochem.ru/wp-content/uploads/2013/08/EuroChem_FS_06_2013.pdf |archivedate=21 April 2014 }}</ref>

===Monopoly claims===
The EuroChem owned Nevinnomysskiy AZOT plant was fined by the Federal Anti-Monopoly Authority in 2007 for exploiting its dominant position as the owner of the electricity network in Nevinnomyssk and depriving other companies of access.<ref>{{cite web|url=http://fas.gov.ru/fas-news/fas-news_11956.html |title=Федеральная антимонопольная служба - Суд подтвердил законность и обоснованность решения и предписания Ставропольского УФАС России в отношении ОАО "Невинномысский Азот" |publisher=Fas.gov.ru |date=2007-03-28 |accessdate=2014-02-22}}</ref>

=== Ukraine anti-dumping duties ===
⚫ In September 2019, the ] ruled that anti-] duties imposed by ] on ] ]s from Russia are violating ] rules, specifically Article 5.8 of the WTO Anti-Dumping Agreement.<ref>{{Cite web|url=https://www.worldfertilizer.com/environment/17092019/eurochem-welcomes-wto-ruling-against-ukraine-anti-dumping-duties/|title=EuroChem welcomes WTO ruling against Ukraine anti-dumping duties|date=2019-09-17|website=World Fertilizer|language=en|access-date=2019-10-31}}</ref> The court thereby upheld Russia's claim that ] should have excluded EuroChem, arguing that its dumping had been minimal.<ref>{{Cite news|url=https://www.reuters.com/article/russia-ukraine-wto-idUSB5N25N00A|title=WTO top court largely backs Russia in fertilizer case with Ukraine|date=2019-09-12|work=Reuters|access-date=2019-10-31|language=en}}</ref>

⚫ ==Financing==
In April 2013 the Russian newspaper Vedomosti reported that EuroChem was looking to take a loan of US$700 million to finance its current development projects. The loan will reportedly be issued by a consortium of Russian and foreign banks.<ref>{{cite web|url=http://www.vedomosti.ru/newspaper/article/429161/milliard_dlya_evrohima |title=ВЕДОМОСТИ - Миллиард для "Еврохима" |publisher=Vedomosti.ru |date= |accessdate=2014-02-22}}</ref>

⚫ On 27 August 2013 EuroChem announced that it has signed a new debut US$1,300,000,000 unsecured loan facility on a club basis. The proceeds were used to pay down the outstanding amount under EuroChem's 2011 US$1.3 billion pre-export facility.<ref>{{cite web |url=http://www.eurochem.ru/news/press-releases/#/single-news/eurochem-secures-debut-unsecured-us1300000000-facility/ |title=Press releases Archives - EuroChem |publisher=Eurochem.ru |accessdate=2014-02-22 |archive-url=https://web.archive.org/web/20131105133513/http://www.eurochem.ru/news/press-releases/#/single-news/eurochem-secures-debut-unsecured-us1300000000-facility/ |archive-date=5 November 2013 |url-status=dead }}</ref>


In 2015, EuroChem-VolgaKaliy won in the Swiss Arbitration Court, which awarded EuroChem-VolgaKaliy around $140m in damages and legal costs<ref>{{Cite web|last=Ewing|first=Richard|title=Fertilizer group EuroChem wins fraud case against Shaft Sinkers|url=https://www.icis.com/explore/resources/news/2015/10/14/9933101/fertilizer-group-eurochem-wins-fraud-case-against-shaft-sinkers|access-date=2021-03-25|website=ICIS Explore|language=en-US}}</ref>. In 2016, EuroChem settled US$1 billion suit against Shaft Sinkers over potash shaft failure. Shaft Sinkers was later declared insolvent, and its listing on the London Stock Exchange was withdrawn <ref>{{Cite web|title=EuroChem settles US$1B suit against Shaft Sinkers over potash shaft failure|url=https://www.spglobal.com/marketintelligence/en/news-insights/trending/dA3CSDcWrb713kJgywvf6g2|access-date=2021-03-25|website=www.spglobal.com|language=en-us}}</ref>.
In February 2014 EuroChem reported its net profit fell 62 percent in 2013 to {{Russian ruble|link=Russian ruble}}12.3bn (US$350 million) due to weak prices in the fertiliser markets.<ref>{{cite web |url=http://www.eurochem.ru/news/press-releases/#/single-news/eurochem-reports-ifrs-financial-information-for-2013/ |title=Press releases Archives - EuroChem |publisher=Eurochem.ru |accessdate=2014-02-22 |archive-url=https://web.archive.org/web/20131105133513/http://www.eurochem.ru/news/press-releases/#/single-news/eurochem-reports-ifrs-financial-information-for-2013/ |archive-date=5 November 2013 |url-status=dead }}</ref>


===Initial public offering=== ===Ukraine anti-dumping duties===
⚫ In September 2019, the ] ruled that anti-] duties imposed by ] on ] ]s from Russia are violating ] rules, specifically Article 5.8 of the WTO Anti-Dumping Agreement.<ref>{{Cite web|date=2019-09-17|title=EuroChem welcomes WTO ruling against Ukraine anti-dumping duties|url=https://www.worldfertilizer.com/environment/17092019/eurochem-welcomes-wto-ruling-against-ukraine-anti-dumping-duties/|access-date=2019-10-31|website=World Fertilizer|language=en}}</ref> The court thereby upheld Russia's claim that ] should have excluded EuroChem, arguing that its dumping had been minimal.<ref>{{Cite news|date=2019-09-12|title=WTO top court largely backs Russia in fertilizer case with Ukraine|language=en|work=Reuters|url=https://www.reuters.com/article/russia-ukraine-wto-idUSB5N25N00A|access-date=2019-10-31}}</ref>
⚫ In February 2017, ] revealed that EuroChem is not planning an IPO in the next few years as the company "has sufficient funds to independently finance its investment program<ref>{{Cite web|title=Melnichenko sees to point in IPO for EuroChem, SUEK yet|url=https://interfax.com/newsroom/top-stories/28967/|access-date=2021-03-24|website=interfax.com}}</ref>".


==Peers== ==Peers==

Revision as of 02:38, 25 March 2021

Fertilizer company headquartered in Switzerland

EuroChem
IndustryFertilizers
HeadquartersZug, Switzerland
Area servedWorldwide
Key people
ProductsFertilizers
RevenueUS$6.2 billion (2020)
Operating income817,158,000 United States dollar (2016) Edit this on Wikidata
Net income707,987,000 United States dollar (2016) Edit this on Wikidata
Total assets8,337,416,000 United States dollar (2016) Edit this on Wikidata
Number of employees27,000 (2020)
Websitewww.eurochemgroup.com

EuroChem (Template:Lang-ru) is a global producer of commodity and specialty fertilizers. It is one of the world’s three largest fertilizer manufacturers with its own capacity in all three primary nutrients – nitrogen, phosphates and potash. It is the fourth largest fertilizer producer globally by revenue.

It is headquartered in Zug, Switzerland. EuroChem has manufacturing, logistic and distributing facilities in Russia, Belgium, Lithuania, Brazil, China, Kazakhstan, Estonia, Germany and the USA. According to its Annual Report, in 2019, EuroChem made more than 100 products, which are sold in more than 100 countries. EuroChem has over 27,000 employees worldwide.

The company's production facilities are located in Russia, Belgium, Lithuania and China. It has mining activities in Kovdor, Murmansk Oblast, Russia, Usolye, Perm Krai, Russia, Kotelnikovo, Volgograd Oblast, Russia, and Zhambyl Province, Kazakhstan.

According to the company, it is one of the world’s top-5 leading producers of nitrogen, phosphate, potash and complex fertilizers. In 2020, EuroChem had sales revenues of US$6,2bn, of which nitrogen US$1.9bn, phosphate US$2.4bn and potash US$0.6bn.

Assets

EuroChem produces nitrogen, phosphate and potash fertilizers, as well as complex fertilizers, iron ore and other industrial products.

It is a company with most production assets in Russia, which moved its headquarters to Zug, Switzerland, in 2015 "to be located in a neutral country to attract capital and talent, and grow globally". It operates production facilities in Russia and Europe (Belgium, Lithuania) and employs more than 27,000 employees globally.

Nitrogen assets

  • Novomoskovskiy Azot (nitrogen fertilizers, urea)
  • Nevinnomysskiy Azot (nitrogen and compound fertilizers, ammonia, industrial gases, organic synthesis products)
  • EuroChem North-West (ammonia)
  • EuroChem Antwerpen (nitric acid plants, NPK and AN/CAN units, nitrophosphoric acid plant)
  • EuroChem Migao (potassium nitrate and complex fertilizers)

Phosphates assets

  • Lifosa (phosphate fertilizers, premium-quality commercial DAP and feed phosphates)
  • Phosphorit (phosphate fertilizers and feed phosphates)
  • EuroChem-BMU (phosphate and compound fertilizers)

Potash assets

  • EuroChem-VolgaKaliy - Gremyachinskoe deposit, Volgograd region (potash)
  • EuroChem-Usolskiy Potash Complex - Verkhnekamskoe Deposit, Perm region (potash)

Sales & Distribution

  • Owned and independent sales distribution network across five world regions: Europe, Russia & CIS, North America, Latin America and Asia.

Ownership

EuroChem is 90% controlled by Andrey Melnichenko, who ranks 95th in the Forbes world billionaires list (7th wealthiest in Russia) with his estimated wealth of US$17.9bn as of March 2021 with the remaining 10% owned by EuroChem Group AG. Melnichenko also controls 92.2% stake in Russian coal producer SUEK.

Business

Milestones

According to S&P Global Market Intelligence (formerly SNL Financial), when EuroChem was founded 20 years ago, "the company was not much more than a pair of Soviet-era nitrogen plants and a dust bowl phosphate mine facing closure" but it was quickly transformed into Russia's biggest fertilizer producer and one of the world's largest largest high-tech fertilizer manufacturers.

One of EuroChem’s key enterprises, Novomoskovsky Azot, became the largest urea plant in Europe, where production of granulated urea began for the first time in Russia. In addition to existing facilities, new modern manufacturing facilities were built in Nevinnomyssk (including the first melamine production plant in Russia) and Kovdor (including an apatite and shtaffelite ores processing complex).

Eurochem bought its first potash mining license in 2005, to develop Gremyachinskoe deposit, located near the town of Kotelnikovo, southwest of Volgograd. It followed up with the purchase of another license area a few years later - the Verkhnekamskoe deposit near Berezniki, Russia's potash stronghold, in 2008. Usolskiy Potash Project produced 2.223 MMT of potash in 2020.

According to Clark Bailey, former managing director of the mining division at Eurochem, the company's philosophy for growth was "vertical integration — from the original mineral, to transportation, all the way to the guy who uses it on the field," as well as "to go upstream and to be self-sufficient in all the raw materials".

In Kazakhstan, the company started mining phosphate rock from its Kok-Jon mine in the southeast of the country. Eurochem bought out the Kazakh government's stake in Sary-Tas, a Soviet-era fertilizer plant near Karatau, in the south of the country. The plant had been mothballed since the 1990s, but Eurochem modernized the facilities and built new plants to produce cheap fertilizer for sale in China, India, central Asia and Russia. The company also produces iron ore from its Kovdorsky mine near Murmansk, which is "byproduct", with the majority of the output bought by Chinese buyers.

According to Bloomberg, "the acquisition of a BASF SE plant in Antwerp by EuroChem for 830 million euros ($930 million) brought in new technologies" for the company. BASF sold its fertilizers activities in Antwerp, Belgium, to EuroChem on March 31, 2012. In July 2012, EuroChem completed the acquisition of K+S Nitrogen, a company marketing nitrogenous fertilizers with a focus on major customers in agriculture and special crops such as fruits, vegetables and grapes.

In 2013, EuroChem established a joint venture with Chinese fertiliser producer Migao in order to increase its presence in Asia, producing potassium nitrate and chloride-free complex fertilizers.

EuroChem’s US$1 billion ammonia plant, EuroChem Northwest, in Kingisepp, Russia, launched in June 2019, has a production capacity of 1 million tonnes (1MMT) per year, ensuring EuroChem’s full self-sufficiency in ammonia. The company approved the construction of EuroChem Northwest 2, a new 1.1 MMT ammonia and 1.4 MMT urea plant, on an adjacent site in Kingisepp, Russia.

Environment

Technology

According to Bloomberg, the company has closed water or steam recycling at its facilities. It uses a technology which limits the water vapour release and enables byproduct heat to warm its fertilizers.

According to the company, Eurochem produces specialty fertilisers that allow slow release of nutrients into crops which limits adverse environmental impact. Its enhanced-efficiency fertilisers (EEFs) reduce nitrogen leaching into soil, decrease greenhouse gas (GHG) and hazardous emissions (nitrous oxide, ammonia) into the air and water upon application.

Its fertilizer, Entec 26, was recognized by a carbon exchange foundation in Switzerland, marking the first time the contribution of advanced fertilizers to reducing agricultural emissions was acknowledged.

EuroChem cooperated with Coca-Cola and other beverage companies at its nitrogen plants capturing CO2 produced each year and processing it using state-of-the-art purification technology to supply for production of carbonated drinks.

The Baltic Sea

EuroChem’s US$1 billion ammonia plant, EuroChem Northwest, in Kingisepp, Russia, officially launched in June 2019, was built on a brownfield site and features a closed water recycling system to prevent water discharge into the Baltic Sea. It uses 75% of waste water from EuroChem’s Phosphorit phosphate plant nearby.

The Helsinki-based John Nurminen Foundation, a Finnish foundation specialized in Baltic Sea protection, has been working with EuroChem on the Baltic Sea ecology since 2012.

Financing

In April 2013 the Russian newspaper Vedomosti reported that EuroChem was looking to take a loan of US$700 million to finance its current development projects. In August 2013, EuroChem announced that it has signed a new debut US$1,3 billion unsecured loan facility on a club basis. The proceeds were used to pay down the outstanding amount under EuroChem's 2011 US$1.3 billion pre-export facility.

S&P Global Market Intelligence (formerly SNL Financial) reported in 2015 that "the company has managed to tap investors in recent years, including a US$750 million project finance facility, a US$1.3 billion syndicated loan and a US$750 million Eurobond issue". According to Olivier Harvey, head of investor relations at the company, "despite the whopping US$7 billion price tag for both potash projects, much of the outlay can be funded over time by Eurochem's free cash flows", while "the devaluation of the Russian ruble was delivering huge cost savings to the company's CapEx program."

According to Fitch, in 2016, Eurochem "signed an agreement for a perpetual shareholder loan of up to USD1 billion" noting that its "diversification into all three nutrients (nitrogen, phosphate and potash), vertical integration and strong cost position support a business profile commensurate with an investment grade rating" and that its scale "is on a par with that of large fertiliser peers" such as CF Industries et al..

In February 2017, Andrey Melnichenko revealed that EuroChem was not planning an IPO in the next few years as the company "has sufficient funds to independently finance its investment program".

In June 2018, Moody's assessed that it "positively notes that EuroChem has a contractual loan agreement with its majority shareholder, which allows it to attract up to $1 billion of a perpetual zero-interest loan to support its liquidity." It noted that, according to its rationale, EuroChem's strengths included: (1) the company's strong business profile, underpinned by its large scale of operations, diversified product mix, and established positions in the global and regional fertilizer markets; (2) sustainable cost competitiveness, which supports relatively high margins, additionally helped by the weakness of the rouble; (3) potential for deleveraging; and (4) proved access to long-term external funding, including a shareholder loan facility, which support liquidity.

Litigation

Shaft Sinkers

In 2012, Eurochem filed suit against Shaft Sinkers, the London-listed South African mining engineering company that had been contracted to construct the shafts at the EuroChem-VolgaKaliy potash site. Soon after starting work on the cage shaft, things started to go wrong; the grouting technology that Shaft Sinkers used failed, and the shaft later suffered water inflow. According to EuroChem's Clark Bailey, the failure and the flooding of the shaft that led to the lawsuit delayed completion at Volgakaliy project by more than two years.

In 2015, EuroChem-VolgaKaliy won in the Swiss Arbitration Court, which awarded EuroChem-VolgaKaliy around $140m in damages and legal costs. In 2016, EuroChem settled US$1 billion suit against Shaft Sinkers over potash shaft failure. Shaft Sinkers was later declared insolvent, and its listing on the London Stock Exchange was withdrawn .

Ukraine anti-dumping duties

In September 2019, the WTO Appellate Body ruled that anti-dumping duties imposed by Ukraine on ammonium nitrate imports from Russia are violating WTO rules, specifically Article 5.8 of the WTO Anti-Dumping Agreement. The court thereby upheld Russia's claim that Kiev should have excluded EuroChem, arguing that its dumping had been minimal.

Peers

See also

References

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