A toll road consortium involving a sanctioned Russian oligarch received more than €40 million from the state to compensate for less than expected traffic.
The payments were made to operators of the N7 Limerick Tunnel over a nine-year period when the group involved a company part-owned by billionaire Oleg Deripaska Irish Independent have learned.
The industrialist, who has close ties to Russian President Vladimir Putin, is no longer involved in the consortium but still holds interests in Ireland as the majority shareholder of Aughinish Alumina’s parent company.
Mr Deripaska was one of several oligarchs sanctioned by the British, Canadian and Australian governments after invading Russia Ukraine Last month. Britain accused the oligarch of complicity in Putin’s aggression.
He had been sanctioned by the US since 2018 for his alleged support of “the Kremlin’s malign activities around the world, including its attempts to undermine Western democracy.” However, he was not sanctioned by the EU.
Forbes estimates Mr. Deripaska’s net worth at €2.4 billion.
Records show that between 2011 and 2019, tunnel and toll road consortium Directroute (Limerick) Holdings Ltd made “variable operation payments” totaling £40.2m to giant Austrian construction company Strabag.
The payments were made under so-called “traffic guarantee” clauses in the public-private partnership contract.
According to Transport Infrastructure Ireland, the clauses were necessary to attract bidders because the tunneling work under the River Shannon involved significant construction risks and uncertainties about traffic volumes.
The payments made up for lost tolls and enabled the consortium to service its debt.
But Tanaiste Leo Varadkar admitted it was “a bad deal” after realizing millions of euros would have to be shelled out each year to make up for lost tolls.
Strabag had a 20 percent stake in the Limerick Consortium, which was joined by AIB, John Sisk & Son, Roadbridge and Meridiam.
This was announced by the Austrian company Irish Independent It sold its interests in the group in 2019 along with its interests in two other Irish toll roads, the N17/N18 between Gort and Tuam and the N8 Fermoy bypass.
Strabag is 25 percent owned by Rasperia Trading, a company controlled by Mr. Deripaska.
In a statement, Strabag said she could not force a shareholder “squeeze-out” but had decided to suspend dividend payments in the face of sanctions.
Given his links to Mr Deripaska, there has been much speculation about Aughinish Alumina’s future and this is likely to intensify if the EU eventually sanctions him. The Co Limerick mill is controlled by Russia’s Rusal, one of the world’s largest aluminum producers, and its parent company EN+, in which Mr Derispaska has a 45% stake.
He previously had a 70 percent controlling stake, but reduced it in response to US sanctions.
Despite this, concerns have been raised that he is still pulling the strings behind the scenes.
Aughinish is a major Midwest employer with 482 full-time employees and 385 contract employees.
It converts imported bauxite into alumina, which is then shipped to plants in Europe to be smelted into aluminium.
In a statement, the corporate ministry said it understands Aughinish’s parent company is conducting a strategic review to protect its operations.
It said there was ongoing collaboration between the Government, IDA Ireland and the company.
This included a meeting with Mr Varadkar and the Finance Minister Easter Donohoe earlier this week.
“The company is a very important alumina supplier for Europe and an important element in the global alumina supply chain. It is also a major employer in Limerick. The government has a keen interest in the plant continuing to operate,” the department said.
“The department and its agencies continue to assess the impact of recent developments and are closely monitoring the situation.”
https://www.independent.ie/irish-news/russian-oligarchs-firm-received-millions-of-euro-from-irish-state-to-compensate-it-for-underused-toll-road-41489140.html The Russian oligarch’s company received millions of euros from the Irish state to compensate them for the underused toll road