Russia's VEB wants to take part in aluminium state stock -report

Vnesheconombank, or VEB, the state development bank of Russia, is planning to participate in government state stock of aluminium creation, reported the news agency Interfax news agency.

Russia's aluminium giant Rusal is presently in a loss making stage. It has supported the creation of such fund since the last year, as the company has suffered loses due to weak aluminium prices and has to pay a net debt of around $10 billion.

Rusal has offered to purchase 1 million tonnes of aluminium at a price of $1.7 billion at current prices for the stock.

"This issue is being discussed," Dmitriev told reporters in Moscow on Thursday, in response to a question on whether the creation of the fund had been being discussed and whether VEB might be involved in it.

The aluminium stock creation has been a controversial issue. Arkady Dvorkovich, the deputy prime minister, said in August the budget of the country does not have sufficient money to make such an effort. The source of financing the project remains an open question, said Dmitriev's.

"It's one thing to be an operator, but another to finance the creation of this fund. This activity (financing) is not a core activity for VEB," Dmitriev said.

Rusal’s attitude has been positive towards the project. The press service of the company said in an email that VEB may be an agent to buy aluminium for the state fund.

If the state-fund of aluminium creation gets approved by the government by end of March, the purchases may begin in the month of July or August, said Rusal. The company has also offered to stock aluminium at its warehouse and purchase it back in 7 years.