MINEX Forum

Tag: Ukraine mining

  • Ukraine Creates Working Group to Address Challenges at Ferrexpo’s Poltava Mining

    Ukraine Creates Working Group to Address Challenges at Ferrexpo’s Poltava Mining

    Ukraine’s Verkhovna Rada Committee on Economic Development has established a working group to address key operational challenges facing mining companies, with the situation at the Poltava Mining and Processing Plant — part of the Ferrexpo group — becoming the first issue under review.

    According to Member of Parliament Oleksiy Movchan, the group held its initial meeting online with participation from representatives of the Ministry of Economy, the National Bank of Ukraine, the Ministry of Justice, the State Tax Service, industry associations, and management of the Poltava and Yeristovo mining and processing plants.

    Several major issues affecting the Poltava operation were discussed, including electricity shortages and high power costs, blocked VAT refunds, and outstanding foreign currency payments owed by the parent company.

    One of the most pressing challenges is the non-refund of value-added tax due to sanctions imposed on the company’s ultimate beneficiary, businessman Kostyantyn Zhevago.

    Dmytro Mospan, manager of legal support for financial activities at Poltava Mining and Processing Plant, said more than UAH 3 billion in VAT refunds remains blocked for the company.

    According to Mospan, the lack of access to these funds has forced the company to reduce the working week, cut social programmes, lower maintenance spending and scale back mining operations.

    The State Tax Service said the situation is governed strictly by the Tax Code of Ukraine. Under Article 200.4, VAT refunds cannot be issued to taxpayers whose ownership structure includes individuals under sanctions.

    Even in cases where courts have ruled in favour of the company, payments remain blocked. Funds are currently held by the State Treasury pending enforcement of court decisions but cannot be transferred due to provisions under Article 200.12 of the tax code.

    One court ruling alone has frozen approximately UAH 230 million related to the plant.

    The working group plans to further examine the company’s ownership structure at future meetings following additional reports from tax authorities.

    Energy supply is another major challenge for the enterprise. Company representatives said limited availability of electricity and high power prices are making operations increasingly unprofitable. However, officials noted that electricity costs are a broader issue affecting Ukraine’s entire mining and metallurgical sector.

    The matter is expected to be discussed further with the Ministry of Energy during upcoming sessions of the working group.

    Movchan also said Ferrexpo AG owes the Poltava operation more than $500 million in unpaid foreign currency proceeds.

    “This debt has been confirmed by international arbitration decisions and the figures have been verified by representatives of the National Bank,” he said.

    The issue will also be examined in subsequent meetings.

    Earlier this month, Ferrexpo announced it had restarted pellet production at the Poltava Mining and Processing Plant after suspending operations in January 2026. The restart was made possible by improvements in electricity supply and lower energy costs.

    According to GMK Center, Ukraine’s iron ore exports fell by 8% in 2025 compared with the previous year, totaling 30.99 million tonnes. In January–February 2026 exports declined even further, dropping 40.9% year-on-year to 3.31 million tonnes, the lowest level recorded since 2023.

  • Ferrexpo Restarts Pellet Production at Poltava Plant After Energy Supply Improves

    Ferrexpo Restarts Pellet Production at Poltava Plant After Energy Supply Improves

    Ferrexpo, the London-listed iron ore producer with mining operations in Ukraine, has resumed pellet production at its Poltava Mining and Processing Plant following a temporary suspension earlier in 2026.

    The company confirmed that one pelletizing line has been restarted after improvements in electricity availability and costs from both domestic and imported energy sources. The facility had halted operations in January due to disruptions linked to damage to Ukraine’s energy infrastructure.

    Production and shipments of premium iron ore pellets have already resumed, with deliveries being made to customers across Eastern and Central Europe. Ferrexpo continues to rely on its own fleet of railcars to manage logistics and export operations.

    Acting chairman of the board Lucio Genovese said the restart coincided with improved conditions as winter ended in Ukraine and the power system stabilised.

    “We are pleased that with the arrival of spring in Ukraine, we were able to resume work and once again produce and export our premium iron ore products,” Genovese said, adding that the restart reflects the resilience and adaptability of the company’s workforce.

    Ferrexpo’s operations had previously been disrupted by Russian missile attacks on energy infrastructure in the Poltava region, which forced the company to temporarily halt production and exports in November 2025.

    The company also disclosed an update regarding its Swiss subsidiary, Ferrexpo AG. One of the group’s partner banks, MBaer Merchant Bank AG, recently lost its licence after a decision by the Swiss financial regulator FINMA and is now undergoing liquidation.

    Ferrexpo AG holds approximately $3 million in accounts at the bank, part of the group’s total cash reserves of about $30 million as of the end of February 2026. According to the liquidators, the bank’s assets are sufficient to fully cover customer claims, and Ferrexpo expects to recover the funds, although the timeline remains uncertain.

    The company said the issue has not disrupted its relationships with other financial institutions but confirmed it is exploring alternative banking arrangements to support international transactions.

    Operational disruptions over the past year have weighed on Ferrexpo’s production performance. In 2025, total iron ore output fell 9% year-on-year to 6.14 million tonnes. Pellet production declined sharply by 47% to 3.22 million tonnes, including 3.14 million tonnes of premium pellets and 81,790 tonnes of direct reduction pellets.

    Meanwhile, commercial concentrate production increased more than fourfold year-on-year to 2.92 million tonnes.

  • Bankruptcy Proceedings Opened Against Poltava Mining Plant as Ferrexpo Shares Slide

    Bankruptcy Proceedings Opened Against Poltava Mining Plant as Ferrexpo Shares Slide

    Ukraine’s Economic Court of Poltava Oblast has opened bankruptcy proceedings against the Poltava Mining and Processing Plant (PGZK), triggering a sharp market reaction and renewed investor concerns surrounding iron ore producer Ferrexpo.

    The company confirmed the development in a statement to the London Stock Exchange on February 24, noting that the court initiated proceedings before a final ruling had been issued by Ukraine’s Supreme Court. Following the announcement, Ferrexpo’s share price fell by 28 percent.

    The bankruptcy case was initiated by Maxi Capital Group, which secured a court judgment in January 2025 ordering PGZK to repay UAH 4.7 billion. The dispute stems from a financial claim originally linked to the failed Finance and Credit bank, where PGZK acted as a guarantor. Maxi Capital acquired the claim in 2020.

    PGZK maintains that the debt had already been settled, citing the write-off of funds in August 2015 and their subsequent return to company accounts in July 2019, arguments reflected in earlier court rulings. The matter remains under consideration by the Supreme Court, despite bankruptcy proceedings now formally underway.

    Operations at the mining and processing plant continue uninterrupted, but the legal escalation has increased uncertainty for investors and lenders. PGZK is one of Ukraine’s largest exporters of iron ore pellets to European markets, meaning prolonged litigation could affect financing conditions, payment stability and regional export flows.

    Ferrexpo stated that PGZK intends to appeal the court’s decision within the statutory ten-day period. However, under Ukrainian law, filing an appeal does not suspend bankruptcy procedures, leaving the timeline and potential consequences difficult to predict.

    The case also adds to broader scrutiny surrounding Ferrexpo and its controlling shareholder, businessman Kostyantyn Zhevago. Earlier in 2025, bankruptcy proceedings were opened against pharmaceutical group Arterium, also associated with Zhevago, while PGZK’s board leadership has faced investigations by law enforcement authorities since 2023.

    Market analysts note that even without operational disruption, reputational risks and declining market capitalisation could complicate access to investment capital. The outcome of ongoing appeals and Supreme Court decisions will likely determine whether the dispute remains a legal challenge or evolves into a broader economic risk affecting employment, exports and investor confidence.

  • Ferrexpo Suspends Ukrainian Operations Again After Renewed Power Disruptions

    Ferrexpo Suspends Ukrainian Operations Again After Renewed Power Disruptions

    Ukrainian operations of Ferrexpo have been temporarily suspended after fresh disruptions to electricity supplies caused by renewed attacks on the country’s energy infrastructure.

    According to a statement cited by Ukrinform, further damage to power generation and transmission facilities has once again limited electricity availability at the company’s sites. Management has therefore decided to halt production and place part of the workforce on temporary leave until a stable and sufficient power supply can be secured.

    The suspension follows an earlier production stoppage announced on 8 November 2025, when Ferrexpo paused operations at the Yeristove and Poltava mining and processing plants in the Poltava region after similar power outages.

    The company confirmed that no employees were injured during the attacks and that its production assets were not physically damaged.

    Ferrexpo previously reported that iron ore output in 2025 declined by 9% year-on-year to 6.14 million tonnes.

  • Ferrexpo Named One of Europe’s Climate Leaders 2025 for Third Consecutive Year

    Ferrexpo Named One of Europe’s Climate Leaders 2025 for Third Consecutive Year

    Ukrainian iron ore pellet producer Ferrexpo has once again been recognized among Europe’s Climate Leaders, appearing on the 2025 list compiled by the Financial Times and Statista. This marks the third consecutive year that Ferrexpo has been included, underscoring its leadership not only in iron ore production but also in climate-conscious industrial practices.

    The Europe’s Climate Leaders ranking highlights companies that have achieved the most substantial reductions in greenhouse gas emissions intensity — measured by emissions per unit of revenue — between 2018 and 2023. Ferrexpo ranked in the top quartile of its sector, a notable achievement for one of Ukraine’s most resilient industrial players amid ongoing national challenges.

    A key driver of Ferrexpo’s success has been its Green Mine program, which includes initiatives such as electrifying mining equipment, introducing trolley-assist systems, and using battery-powered locomotives. These efforts have helped the company cut gas consumption by 30% since 2015 through biofuel adoption and launch a 5 MW solar power plant in 2021.

    Looking ahead, Ferrexpo plans to invest $3.3 billion in decarbonization efforts by 2050. Part of this strategy includes building an additional 10.8 MW solar facility to support the company’s energy needs. Ferrexpo’s commitment places it among the few Eastern European companies actively aligning with global climate and sustainability goals.

  • Ferrexpo Slashes Iron Ore Output by 40% Amid Ukraine VAT Refund Freeze

    Ferrexpo Slashes Iron Ore Output by 40% Amid Ukraine VAT Refund Freeze

    Ferrexpo, the London-listed iron ore producer with major operations in Ukraine, reported a steep 40% drop in second-quarter production after a suspension of value-added tax (VAT) refunds crippled its liquidity and forced the company to scale back operations.

    In a statement on Monday, Ferrexpo revealed that total commercial production fell to 1.3 million tonnes for the quarter ending June, down from 2.1 million tonnes in Q1. The company attributed the decline to a $31 million VAT refund freeze by Ukrainian authorities, covering the period from January to April.

    The company’s Poltava Mining unit, already under pressure from potential bankruptcy proceedings, has responded by placing approximately 37% of its workforce on reduced hours or furlough and cutting back on procurement of goods and services required for production.

    Ferrexpo said the halt in VAT payments is linked to personal sanctions on its largest shareholder, Kostiantyn Zhevago, who was arrested in 2022 on embezzlement charges. Although the company itself is not under sanctions, the indirect impact has been severe, hampering its ability to operate in Ukraine’s strained financial environment.

    The miner warned that these constraints could continue to impact output unless the financial pressure eases.

  • Turkey’s Onur Group to Begin Mining Major Ukrainian Mineral Deposits in 2026

    Turkey’s Onur Group to Begin Mining Major Ukrainian Mineral Deposits in 2026

    Ukraine has granted Turkish conglomerate Onur Group five special permits to mine some of the country’s most valuable mineral deposits, including graphite, gold, and kaolin. The mining operations, scheduled to begin in 2026, are focused on high-potential regions such as Dnipropetrovsk, Kirovograd, and Khmelnytsky.

    Among the five sites, the graphite deposit in the Khmelnytsky region stands out. The Gorodnyavskoye deposit alone holds nearly 143 million tonnes of ore with a graphite carbon content of 5.14%. Experts estimate the deposit could support extraction for over a century. The European Union has recognized its strategic value, listing it among key critical mineral projects vital for Europe’s industrial supply chains.

    However, not all prospects proved economically viable. Onur Group has pulled back from plans to develop a gold site in Dnipropetrovsk after testing revealed lower-than-expected yields of just 1.4 grams per tonne—significantly below the 4.5 grams originally projected.

    While four sites remain in early stages due to safety and logistical issues—partly owing to Ukraine’s ongoing conflict—the graphite project is moving forward. Mining at Gorodnyavskoye is expected to begin in 2026.

    The deal underscores Turkey’s growing interest in critical mineral supply chains. Rare earths and graphite are essential for high-tech manufacturing, energy storage, and defense. With global supply chain pressures intensifying, this venture positions Turkey as a key player while also highlighting Ukraine’s mineral wealth as a geopolitical asset.

  • Turkey’s Onur Group Secures Ukraine’s Top Mineral Sites Amid EU Strategic Push

    Turkey’s Onur Group Secures Ukraine’s Top Mineral Sites Amid EU Strategic Push

    Ukraine has granted Turkish conglomerate Onur Group exclusive access to exploit some of its most prized mineral reserves—including graphite, kaolin, and gold—marking a significant step in international investment amid regional conflict and economic uncertainty. The company is expected to launch operations in 2026, starting with what may be Ukraine’s largest graphite deposit in the Khmelnytsky region.

    According to reports from Czech outlet Body Guru, Onur Group currently holds five special mining permits. These include one gold deposit in the Dnipropetrovsk region, three kaolin sites spread across Kirovograd and Dnipropetrovsk, and the massive Gorodnyavskoye graphite deposit. The latter boasts 143 million tonnes of approved ore with an average graphite carbon content of 5.14%, promising up to 130 years of extraction potential.

    The graphite project has been recognized by the European Union as strategically important, reinforcing its role in securing Europe’s supply of critical raw materials essential for electronics, electric vehicles, and green technologies.

    Despite initial optimism, Onur Group has walked away from the gold deposit after discovering far lower-than-expected mineral grades—just 1.4 grams of gold per tonne, compared to the projected 4.5 grams. This economic mismatch rendered the project unfeasible.

    While four of the five mining sites remain in preparation stages due to logistical and security challenges near conflict zones, Onur’s efforts represent more than just a commercial venture—they also illustrate Turkey’s strategic push to increase influence over key mineral supply chains.

    As global competition intensifies over rare earth elements and industrial minerals, Ukraine’s openness to foreign investors may offer both risks and rewards. For some, the move raises concerns over sovereignty and long-term control of national resources. For others, it signals a pragmatic path toward economic recovery and integration with Western supply chains.

  • Once-Promising Samsonivska-Zakhidna Mine Now in Critical Condition

    Once-Promising Samsonivska-Zakhidna Mine Now in Critical Condition

    The Samsonivska-Zakhidna mine, once hailed as the “mine of the future,” is now in a dire state, according to Artem Lysohor, chairman of the Luhansk Regional Military Administration.

    Located near Otamanivka, the mine was handed over to a Russian investor for a symbolic price following the occupation in 2014. Despite initial promises of large-scale development, increased coal production, and new machinery, none of these commitments have materialized.

    “Last year, there was talk of restarting operations, but it seems they have changed their minds,” Lysohor stated.

    Before the Russian occupation, Samsonivska-Zakhidna was one of Luhansk’s key coal producers, contributing significantly to the region’s economy. Now, its future remains uncertain.