How OGKhK Ilmenite Is Loaded onto Crimea, While the State Property Fund Covers Up the Shipments

How OGKhK ilmenite is loaded onto Crimea, while the State Property Fund covers up the shipments

Port workers told us an interesting, almost detective-like story.

A ship like this 2 in July was put up for loading at the Odesa Sea Port. It was planned that this giant beauty would be loaded with 24 thousand tons of ilmenite from the United Mining and Chemical Company (OGKhK) consigned to the German trading “front” ITS. The company is suspected of ties to businessmen Firtash and Lyovochkin. It is suspected that the intermediary is buying OGKhK’s product on behalf of the “Crimean TITAN” in the Russian Federation.

The declaration under which OGKhK’s product was supposed to go by sea alarmed customs officers from the anti-smuggling unit. They decided to check the shipment route and suspended the loading of the ship. Law enforcement found it suspicious that the vessel was delivering ilmenite to the Mediterranean Sea and then its trail disappeared. OGKhK did not answer where the goods were headed, citing commercial secrecy, port workers said.

This is usually how cargos that later go to the annexed territories, to Crimea for example, are documented. And as is known, supplying goods and materials from mainland Ukraine to there is prohibited. But! The situation was personally intervened in by the head of the State Property Fund, Dmytro Sennichenko. They say he beat the halls of high offices and even involved the SBU so the ship would be loaded without checks and unnecessary delays.

Why is OGKhK’s management hiding the end buyer of its product, and who is behind this?

ITS International Trade & Sourcing GmbH & Co. is a company with a staff of 2 people with Russian surnames. Its founder and director is a certain Oleh Tsyura. ITS is little known on the market. Its turnover has not yet exceeded 1,5 million euros.

But on 17 June the company got very lucky – it signed a contract with acting CEO of the United Mining and Chemical Company Peter Davis. The contract amount more than doubled ITS’s previously achieved turnover – 3,7 million euros. The payment deferral under the contract is 15 days, the price is below market by 20–40 dollars per ton. A typical scheme for extracting working capital from a state company.

Nevertheless, Peter Davis boasted about this contract to domestic media, speaking of another “victory” in sales of ilmenite from the Irshansk Mining and Processing Plant (a branch of OGKhK) on 27 June. Market participants and experts suspected that the end buyer in this contract was the «Crimean TITAN» of Dmytro Firtash, which now belongs to the Russian Federation.

Why were they suspected? There were several reasons. First, ITS did not request samples of OGKhK’s product before buying it. Instead, it immediately purchased large volumes. This means the end buyer is not accidental or new — he is already familiar with Irshansk MPP’s product.

Such a consumer could be «Crimean TITAN», which in 2004 through 2014 years had already purchased ilmenite with TIO2 content of 54% from Irshansk MPP. From it they produced titanium white — titanium dioxide. Obviously, that is why they did not bother to hedge.

If the end buyer and processor of OGKhK’s Irshansk ilmenite is indeed a Crimean enterprise, as market participants and experts suspect, then Peter Davis bragged about such a contract rather recklessly, and the customs officers’ suspicions are completely justified.

An interesting connection of Peter Davis with Firtash–Lyovochkin companies. In 2012 he was listed as a member of the supervisory board of Clearing House Bank under Firtash’s partner Ivan Fursin.

This sheds light on why, on the eve of OGKhK’s privatization, Peter Davis allocated such large volumes of product to a little-known outfit, and even at a discount.

But Peter Davis is covered not only by a curator at the State Property Fund — Dmytro Sennichenko. He has other helpers. Helping him siphon money from the state OGKhK in favor of Firtash’s Crimean enterprise is OGKhK’s head of security and member of the company’s board, Yurii Solovey. He personally oversees shipments under the contract with ITS together with his former boss from the Party of Regions era — Yurii Vaskov. According to port workers, using old connections in the Sea Ports Administration, the former official got involved to “resolve” the issue of shipping ilmenite toward Crimea for the German “front” ITS.