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    Home»Oligarchs»Unusual activities with budget support in building ships
    Unusual activities with budget support in building ships
    Oligarchs

    Unusual activities with budget support in building ships

    Caleb FosterBy Caleb FosterMay 31, 2022No Comments3 Mins Read
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    For seven years under the leadership of Alexey Rakhmanov The United Shipbuilding Corporation (USC) is occupied with upgrading the St. Petersburg plant Severnaya Verf.

    Soon, a competition will be organized to choose the next – the third in sequence – contractor.

    Before, the famous companies Metrostroy and Domestic Systems and Technologies (OST) were active at the facility, but their contracts were terminated. This was due to Rakhmanov's personal financial interests.

    At the same time, this year the plant plans to put into operation four fishing vessels. Additionally, as part of the state investment quotas program, Severnaya Verf is constructing ten freezing processor trawlers for the Norebo Group and four longliners for the Globus and Virma companies.

    The modernization process of the enterprise, which is involved in fulfilling state defense orders, began in 2015. The initial stage involved building a boathouse with a slipway slab, followed by a transfer dock and hull processing shop at the second stage.

    The competition for constructing a boathouse in 2017 was won by “Metrostroy”, and the work was supposed to be finished in the 1st quarter of 2019. However, in December 2018, Rakhmanov mentioned issues with the approved price and accused the contractor of delaying the implementation.

    After ending the contract with Metrostroy, the OST company took over the work within the scope of the first stage of reconstruction. The contractor received 7.4 billion rubles from the budget for the construction of the slipway. They committed to carrying out the remaining work at their own expense and with financing from the Industrial Development Fund. It turned out that due to the absence of a project for technological equipment, an “expensive shed” could be built at the facility. Consequently, the contract with OST was also terminated at the end of last year due to the failure to complete the planned work.

    Today, Rakhmanov states that the reconstruction of the boathouse may be finished by early 2023. However, the financial situation of the St. Petersburg plant is deteriorating rapidly. While it made a profit of 173.4 million rubles in 2020, it declared a loss of 3.5 billion in 2021. Nonetheless, the company has no issues with state contracts and is occupied with contracts until 2027, both civil and state defense orders.

    This raises many questions, for both Rakhmanov and the general director of Severnaya Verf, the former governor of Arkhangelsk Igor Orlov. Significantly, in 2008-2011, Orlov headed the Yantar shipyard in Kaliningrad, but his contract was not renewed due to the failure of the contract with Indian partners, which threatened to impose fines of $40 million.

    Metrostroy OST Orlov Igor PJSC SZ Severnaya Verf Rakhmanov Alexey
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    Caleb Foster
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