Moscow, 30 July 2008 - VTB Bank and VTB Bank Europe plc (VTB Group) have arranged a USD 1.51bn, three-year medium term secured finance facility to OJSC Kamskaya mining company.
The facility is used for acquisition of the licence to develop a new deposit.
On 12 March 2008, OJSC Kamskaya mining company (affiliated company of Silvinit) was named the winner in the auction to develop the Polovodovsky field at the Verkhnekamsk potassium-magnesium deposit, offering RUR 35.14bn. The Polovodovsky field is the second largest field in the world by reserves, with resources exceeding 3 billion tonnes of potash ore.
The facility provided by VTB Group allows OJSC Kamskaya mining company to settle the payment for the licence on time and in full.
Yuri Soloviev, President of VTB Capital and Head of VTB Group's Investment Business, said: "Our goal is to provide world-class services to our clients in Russia and globally. At the same time, supporting domestic producers is one of the priorities of VTB Group's Investment Business. In spite of the liquidity crisis in the Western markets and the tight schedule for completing the necessary banking procedures, our London business - VTB Bank Europe plc - was able to open the US$ 1.5 billion facility for Silvinit's subsidiary, Kamskaya mining company, extremely quickly. We are proud that the loan provided will allow Russia to strengthen its positions in the global potash market. We are grateful to our partners for their trust in us and wish them every success in their business."
OJSC Silvinit is Russia's major mining and production complex for potash fertilizer and different kinds of salts. The Company develops the Verkhnekamsk potassium-magnesium deposit, the biggest in Russia and the second largest in the world, with reserves of up to 3.8bn tonnes (in terms of K2O).
In 2007, OJSC Silvinit produced 5.469mn tonnes of potassium chloride, a record annual volume for the domestic potassium industry. In the same year, Silvinit also produced over 1mn tonnes of different kinds of salts. Silvinit is the only Russian potash company producing sodium chloride and technical-grade salts. Since 2006, Silvinit has been the last remaining Russian company in the carnallite mining sector (carnallite is used in the production of magnesium and titanium).