14 Sep 2009 16:41

Intergeo again proposes asset swap, Norilsk Nickel not impressed

MOSCOW. Sept 14 (Interfax) - Intergeo, a mining company formed by billionaire Mikhail Prokhorov's Onexim group in the summer of 2008, has again suggested swapping exploration assets for debt owed to MMC Norilsk Nickel , but the latter sees nothing serious on offer.

Norilsk Nickel's press office told Interfax that the company had received a letter from Maxim Finsky, the general director of Intergeo, seeking to revive a proposed asset swap first discussed last winter.

Norilsk Nickel has been suing companies represented by Intergeo over debt. Courts have so far ordered Intergeo members to pay nearly 130 million rubles and are still considering claims.

Finsky writes that Intergeo's firms have no cash or other assets to meet the claims, so the claimant is unlikely to get anything back through receivership or bankruptcy. Also, the company's exploration licenses cannot be seized as the state would revoke them.

Intergeo suggested in the winter that it swap the Chernogorskaya, Sibirskaya and Kodorskaya mining companies for Norilsk Nickel's Kingashskaya Mining Company. Finsky's letter suggests this would still resolve the debt problem and lay the foundations for the fields to be developed properly.

But Norilsk Nickel told Interfax that it did not see any serious offers that it could consider in the letter.

The Moscow Arbitration Court in May this year ordered Intergeo's LLC Kamenskaya to pay Norilsk Nickel 2.722 million rubles debt on a loan. It heard a claim against Sibirskaya Mining Company for 9.25 million rubles in August.

A court in May this year ordered Chernogorskaya Mining Company to pay 115.7 million rubles principal and 11.98 million rubles interest on a loan received in February 2008. The court could order the company to pay a further 1.64 million rubles when it hears another suit filed by Norilsk Nickel on September 21.

Intergeo was formed when Onexim received exploration licenses when the investment vehicle CJSC KM Invest was unbundling assets held by former business partners Mikhail Prokhorov and Vladimir Potanin.

Plans existed to invest $10 billion in Intergeo in the next five years and turn the company into one of the world's top three producers of copper, nickel, molybdenum, titanium and platinum group metals.

Chernogorskaya Mining Company in 2006 won the exploration and mining license to the Chernogorskoye copper and nickel deposit in Taimyr, in the Norilsk industrial district.

Intergeo also planned to consolidate the licenses to the Arbinskaya, Vostochno-Chelyuskinsksya, Iisko-Tagulskaya,Isakovskaya, Togunasskaya and Oronaiskaya properties, the western flank of the Gremyakha-Vyrmes deposit, Bolshoi Seiim and the Orekitkanskaya and Ak-Sugskoye deposits.

But, once Onexim had announced it was planning to consolidate these licenses under the Intergeo umbrella, Norilsk Nickel said it would conduct an internal inquiry into suspected asset stripping. Ultimately, it was agreed that Norilsk, if it so wished, would be able to buy the licenses from Intergeo at a price equal to the capital invested in them.