Rusal update does little to lift uncertainty for Aughinish in Shannon Estuary

Rusal is 'for the time being' delivering on global contracts as it struggles with the fallout from sanctions on Russia   

Aughinish Alumina in Co Limerick employs around 500 people and is the one manufacturing site on Irish soil whose workers potentially have the most to lose from the sanctions regime and soaring energy costs.

Rusal, the international mining to metals giant which owns the huge alumina smelter Aughinish in the Shannon Estuary, said that "for the time being" it is delivering on its global contracts as it struggles with the fallout from Western sanctions on Russia.   

However, an earnings update released on Friday does little to lift the longstanding uncertainty facing Rusal and its Aughinish plant. It employs around 500 people at the Co Limerick smelter and is the one manufacturing site on Irish soil whose workers potentially have the most to lose from the sanctions regime and soaring energy costs since Russia invaded Ukraine in February.   

Auginish is one part of Rusal's international operations that employ 59,500 people in Russia, Ukraine, Guinea, Jamaica, Italy, and Sweden, and in many other locations. Rusal produces the compound alumina from bauxite mines and makes aluminium used by car makers and in construction, as well as related products, such as tin foil, for global markets. 

The smelter has become embroiled in the sanctions regime targeting Russia because of Rusal's Russian ownership and its links to oligarch Oleg Deripasksa, who once controlled Rusal outright. Mr Deripaska, who is close to president Vladimir Putin, has been personally sanctioned by the US and UK.

In the half-year earnings update, Rusal said it has been battling "numerous difficulties, which we are overcoming", including the Australian government’s ban on alumina and bauxite exports to Russia.

"One of the most important was the confusion around the scope of various sanctions. We have since observed further compliance checks from the banks as well as several institutions choosing to reduce exposure to financing commodities originating from Russia," said chairman Bernard Zonneveld. 

We can say that, for the time being, problems with operations, logistic and supply chain are resolved, allowing the company to execute all contracts in full." 

Despite the storm over sanctions and the closure of a plant in Ukraine, Rusal posted a half-year profit of $1.68bn (€1.63bn) on higher aluminium prices with revenues of $7.1bn. 

Aughinish has faced the fallout of sanctions over its Russian owners in the past. The US had previously imposed sanctions which lasted until 2019 on Rusal and other companies linked to Mr Deripaska.