UC Rusal and Lukoil in Oil Coke War

Russian aluminium and alumna giant UC Rusal is taking legal action against Russian energy company Lukoil, which it claims is leaving its smelters inadequately supplied.coke crusher

Rusal has alleged Lukoil has cut supplies without its consent, leaving its smelters undersupplied by about 40,000 tons of oil coke between April and June 2008.

In a written statement UC Rusal said it believes Lukoil has “significantly decreased the supply of coke to the company’s largest aluminium smelters in violation of its obligations under existing long-term contracts”.

UC Rusal is calling on the Russian Federal Antimonopoly Service (FAS) to take “relevant measures” to stop Lukoil from breaching article 10 of the Federal Law on Protection of Competition, to stop what it describes as its “dominant position” in the oil coke market.

This article prohibits actions of an organisation controlling a dominant share of a market which includes forcing a contractor to accept disadvantageous conditions.diatomaceous earth mill

Lukoil, however, told mining-technology.com in an exclusive interview its refinery division – which supplies the oil coke to Rusal – has had to reduce supply due to the rising cost of oil.

“We signed a contract with UC Rusal in 2006 [to deliver coke at a set price],” a Lukoil spokesperson said.

“Since then oil prices in Russia have doubled. As a result, the price for oil coke has tripled.

“In this situation, we cannot sell this product below the sales cost.

“We informed Rusal that we could not supply them at these current oil prices,” he said.

Lukoil, which is preparing its own letter to the antimonopoly committee will ask for an “analysis and examination” of its relationship with Rusal, before a court hearing on 11 September. crusher