Investigation into Tomet Case is not Over

Investigation into Tomet Case is not Over


For a long time, has been monitoring the situation around TogliattiAzot, one of Russia’s largest chemical fertilizer producers. Today, we offer our readers another article on this issue posted on the website

The Committee for Protection of TogliattiAzot from Crime addressed law enforcement and supervisory bodies with a request to pay attention to the actions of owners of TogliattiAzot and Tomet that can be of potential danger for people, economy and ecology of the Samara region. According to Yuri Sergunin, the chairman of the committee, the causes of the two accidents at Tomet at the end of 2020 should be the subject of rigorous investigation by law enforcement and supervisory agencies.

On July 5, 2019, the Komsomolsky district court in the city ofTolyatti found Vladimir and Sergey Makhlai, as well as their Swiss accomplice Andrew Zivi, guilty of a fraud on an especially large scale under Part 4 of Article 159 of the Criminal Code. The ruling said the offense was committed in collusion by a group of persons. The court ruled to jointly collect a total of 87 bln rubles ($1.18 bln) of damage from 20 individuals and legal entities associated with the plant’s owners. A total of 77 bln rubles ($1.045 bln) are to be paid for the benefit of TogliattiAzot.

Tomet has become one of these co-defendants. As stated in the appeal, this company was established by Vladimir and Sergey Makhlai, the owners of TogliattiAzot, in the late 1990s. It is located on TogliattiAzot’s territory and is included in its production infrastructure. From 2000 through 2010, in violation of the law on joint-stock companies, the most liquid assets of TogliattiAzot were withdrawn to Tomet. For example, all methanol production and ammonia unit No.7, the newest and most productive one, were transferred from TogliattiAzot to Tomet. At the same time, under the sale-purchase agreements, the cost of the withdrawn equipment was 100 times lower than its market value. The costs of supplying Tomet with raw materials and servicing its equipment are borne by TogliattiAzot. Tomet is the profit center which is withdrawn to the offshore zones controlled by the Mahlai family. Tomet belongs to Triumph Development Ltd., a Hong Kong-based offshore company. Andrew Ziwi, a partner of Vladimir and Sergey Makhlai, is its beneficiary. At present, the circumstances of the illegal withdrawal of TogliattiAzot’s assets to Tomet are being investigated as part of a criminal case initiated by the Investigative Committee in 2019 under Part 3 of Article 210 of the Criminal Code on building a criminal organization.

The court levied damages of 77 bln rubles ($1.045 bln) on Tomet to be paid to TogliattiAzot. To prevent a financial fraud, the FSB federal security service blocked the plant's accounts. One of the accounts was later unblocked to pay workers' salaries. According to the information reported in the media, in order not to return the money, in early 2020, Vladimir and Sergey Makhlai initiated Tomet’s bankruptcy. They began to burden it with unreasonable accounts payable and in October stopped production there.

However, on November 25, 2020, the Arbitration Court of the Samara region introduced a monitoring procedure in Tomet and appointed an arbitration manager. According to the court's ruling, all of Tomet's accounts were unblocked, and the company’s operation was expected to be back on track.

On December 6, at the beginning of start-up operations at the methanol units, when the heated gas started being provided into the reformer tubes of the furnace, an accident occurred. It caused damage to the furnace tube and produced a jet of burning natural gas. This led to a complete shutdown of one of the methanol machines. At first, the workers thought that one of the tubes had burst and its welds had collapsed. However, then the plant's repair service discovered damage on several pipes at once. About 15 of them are to be completely replaced. According to Tomet employees whose opinion is cited in the appeal of the TogliattiAzot Protection Committee, it is impossible to repair these pipes by welding especially in conditions of low winter temperatures.

Then, on December 14, the second methanol unit suddenly went out of action. The probable causes included the same breakage of welds, damage to the built-in heat exchanger coils, or even worse, freezing of the pipelines. In the case of freezing, this poses the risk of the failure of the entire heat-exchange equipment and the whole furnace.

However, to really freeze the pipeline, someone had to work hard. According to experts, stopping the operation of methanol units does not mean turning off the switch, says the address. It puts the units into a special mode in which no production is done, but the units and pipelines are heated to keep the equipment in serviceable condition during downtime. Freezing is an emergency and most often signals a complete failure of the equipment.

Yuri Sergunin, the head of the committee, draws the attention of law enforcement agencies to the character of the almost simultaneous shutdown of both methanol units at Tomet that might have been the result of criminal negligence and incompetence of the company's executives. This version was widely discussed on the media scene at the end of the year. Reporters sought answers to the following questions: were any technical inspections, examinations, audits and expertise conducted at the plant during shutdown maintenance? The thing is there was enough time to scrutinize the technical condition of reforming furnaces, reformer tubes, built-in heat-exchanging coils, gas removal systems such as smoke exhausters and forced ventilation systems, and shut-off control valves such as gas and gate valves. Tomet was idle for a month and a half. Whether this was done at all and if it was, it still remains a question whether it was done at a proper level.

The Committee for Protection of TogliattiAzot from Crime is sounding the alarm. The issues with industrial safety and the technical condition of equipment and infrastructure at TogliattiAzot have long been known. The situation at Tomet is likely to be the same. The Mid-Volga Branch of the Federal Service for Environmental, Technological and Nuclear Supervision (Rostechnadzor) carries out little more than formal checks. Inspectors write out token fines. The most dangerous and serious violations are ignored by the watchdog agency. Accidents are not properly investigated, and no measures are taken to prevent them. The media have also published a lot of articles related to this issue. The local Rostechnadzor's office has been inactive with regard to the accidents, which occurred in December at Tomet.

However, the accidents and complete shutdown of two units in less than two weeks already look much more like a planned sabotage than simple negligence, Sergunin says citing the reporters’ opinion. According to the media, after the Makhlais’ plan to bankrupt Tomet under their control and withdraw money from it failed, they might have come up with a new one. Namely, to destroy the production base of the plant and leave behind a "scorched earth" so that a possible new investor would get only ruins of it.

So far, unfortunately, one should admit that Tomet is not operating, and wages and taxes are not being paid. What other "surprises" might be expected from the Makhlai famiy and their accomplices Mezheedov and Chabrov, the CEOs of TogliattiAzot and Tomet? They oppose court rulings and organize sabotage. It should be recalled that this refers to hazardous production facilities where consequences of accidents might lead to accidents and affect people’s lives and the ecology of the entire region.

The Committee for Protection of TogliattiAzot from Crime believes that the information given in the appeal must become the basis for a thorough and comprehensive inspection of the activities of Tomet’s management for possible violations of the Russian legislature.

Yuri Sergunin addressed the government agencies to verify compliance with safety standards and regulations at Tomet, to thoroughly check the technical condition of the company’s equipment, as well as to investigate the causes of accidents at Tomet on December 6 and 14 giving an objective assessment of them. The appeal contains a request to investigate possible deliberate damage to Tomet’s production equipment.

Thus, in the nearest future, we might learn about new administrative and criminal cases against Vladimir Chabrov and Dmitry Mezhedov, the CEOs of Tomet and TogliattiAzot, and their deputies.

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