Oligarch Akmetov’s plants in occupied Donbas stop production amid trade blockade

Rinat Akhmetov, owner of SCM Holdings, which is the major shareholder of Metinvest Group. Credit: scmholding.com

Rinat Akhmetov, owner of SCM Holdings, which is the major shareholder of Metinvest Group. Credit: scmholding.com 

News, War in the Donbas

Activists have been blocking several railway lines connecting the Donbas with its occupied parts since January. The blockade created obstacles for transportation of coal for anthracite-fired power plants in Ukraine and of iron ore raw materials for steel works on the uncontrolled territories.

On February 20,  the Metinvest Group operating factories on both sides of the frontline reported that its plant and coal company in the occupied regions halt production:

Yenakiieve Iron and Steel Works (“Yenakiieve Steel,” which includes a Makiivka branch), a steelmaker, and Krasnodon Coal Company (“Krasnodon Coal”), a coking coal producer, subsidiaries of Metinvest Group, have halted operations. Production has been disrupted by the ongoing armed hostilities and a blockade of railway transportation between Ukraine and the uncontrolled territory in the southeast.

Metinvest Holding LLC is owned by Ukrainian tycoon Rinat Akhmetov.

Coal trains in Yenakiieve. Credit: twitter.com/Utilizator_

Coal trains stand by in Yenakiieve, unable to leave occupied Donbas because of the blockade. Credit: twitter.com/Utilizator_

A trade blockade of the occupied parts of Donbas was launched on January 25 by demobilized soldiers and veterans of Ukrainian volunteer battalions, Shypilove-Svitlanove rail section which connects occupied Luhansk to government-controlled Lysychansk and Popasna was blocked.

Blockade activists say that trading with the occupied areas is equal to trading on the blood. In their opinion, the militants get their profits from commerce with Ukrainian companies. Authorities are of the opinion that the blockade should be ceased as the country’s energy security is under a threat.

On February 11 another rail section was blocked between government-controlled Kostiantynivka and occupied Yasynuvata.

Then activists set up their checkpoint on a highway near Zolote settlement in Luhansk Oblast on February 16.

On February 9, activists led by 2 MPs rallied in support of the blockade in Kyiv, the protest ended in clashes with riot police, 5 were detained

On February 14, Alchevsk Metallurgical Plant (AMK), an ironworks in the uncontrolled area of Luhansk Oblast, suspended iron smelting. AMK is owned by another Donbas tycoon Serhiy Taruta.

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  • Tony

    Militants are also threatening to nationalize Akhmetov’s Donbass’s plants if doesn’t pay tax there and “respect” DNR/LNR.
    Voxukraine had an interesting piece where they argued that the oligarchs need to be financially drained to deny them the resources to corrupt politics. So Akhmetov’s troubles may be bad for Ukraine’s short term economics but they may also be good in the long term.

    However if the oligarchs fortunes decline at the same pace as Ukraines GDP then the oligarchs will maintain their relative strength. This is probably why a one year heavy oligarch tax as was argued in Vox is better.

  • MichaelA

    ukraine should have been working on alternatives to donbass coal a long time ago

    • Mick Servian

      They have
      they buy US empire coal for three times the price.
      Banana republic

      • MichaelA

        No they buy it at a better price, and without thereby financing the terrorists in the donbass
        yes russia is a banana republic

        • Mick Servian

          Yeah you would know the price. Lol
          Cause you know stuff eh? Lol
          Russia is and has always been a great country. With a deep history and contribution to philosophy, literature and arts.
          Ukraine = fuck all with complex
          Haha

          • MichaelA

            russia gets its history from ukraine
            which is far older
            and its culture
            and yes they buy it at a better price

          • Mick Servian

            Russia gets it’s culture from Ukraine. Lol
            There. That’s that racist bullshit I’ve been waiting for.
            You don’t know the price. Cause you’re a troll.
            You don’t even know what your allowed to say until someone gives you the go ahead.
            Like ur not allowed to say anything bad about the US.
            Hahahaha

          • MichaelA

            why is it racist to say that russia gets its culture from ukraine?
            if its the truth then its not racist
            now of course not all of it
            after all a lot of russian culture is of tatar origin
            as is some of ukraines but not nearly as much
            but I am talking about historical origin
            and yes they buy it at a better price
            ummm something bad about usa
            okay
            their food is crap?