Bulgarian Government to Oppose Closure of Kremikovtsi Steel Mill

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Bulgarian Government to Oppose Closure of Kremikovtsi Steel Mill

The Government will oppose to all attempts to close down strategic steel mill Kremikovtsi which
provides jobs to more than 70,000 in various sectors, the Government Information Service said Friday.

Prime Minister Sergei Stanishev had a working meeting with Deputy Prime Minister Ivailo Kalfin and Economy and Energy Minister Peter Dimitrov in connection with the announcements that Kremikovtsi owner Pramod Mittal intends to sell it to Ukrainian investor Konstantin Zhevago.

Immediately after the meeting Stanishev had a telephone conversation with Mittal. Kremikovtsi majority stakeholder assured the Prime Minister that he has not carried out any discussions with any local government representatives about the future of the mill. "I have not met and I have not discussed Kremikovtsi with Sofia Mayor [Boiko Borissov]," he said. Mittal assured Stanishev that he will keep him informed about the negotiations with the three potential strategic investors, two from Ukraine and one from Russia. He took the commitment not to finalize the deal without the knowledge and agreement of the executive branch of Government.

The Prime Minister invited Mittal to an urgent meeting to clarify his intentions.

The Government Information Service is authorized to announce that despite the fact that the state holds a minority stake, it monitors carefully the development of Kremikovtsi steel mill as one of the important strategic enterprises of the country.

The Bulgarian Government insistently recommends to all potential buyers to carry discussions with the Economy and Energy Ministry before finalizing a possible deal.

The Economy Ministry is also ready to have discussions with Kremikovtsi shareholders in view of protecting and guaranteeing their interests, the press release added.

The drive for the closure of the iron and steel works, seen by ecologist and political organizations as Sofia's worst pollution source, has been spearheaded by Sofia Mayor Boiko Borissov. On July 27, 2007 Borissov, in his capacity as private individual, alerted the European Commission's Environment
Directorate-General that Kremikovtzi pollutes the air, water and soil in the area at double to quintuple the limit values. The emissions contain dust, lead, sulphur dioxide, nitrogen oxides, carbon monoxide and general hydrocarbons. An analysis of the results of an ambient air quality measurement showed fine particulate matter of treble to sextuple the average diurnal limit value, Borissov's complaint noted.

Sofia's Chief Architect Peter Dikov wants to see the area occupied by the steelmaker in the city's northern outskirts redeveloped into a modern residential and business complex.

In late November 2007, Environment and Water Minister Djevdet Chakurov said that, despite pressure from the trade unions, which have threatened to take strike action, Kremikovtsi will not be issued an integrated permit unless it presents a serious environmental investment programme and proof of its implementation. He recalled that Kremikovtsi was refused such a permit because it did not meet fundamental requirements for bringing its production into line with environmental criteria.

The company must reach EU standards by 2011.

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