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. Last Updated: 07/27/2016

Norilsk Expects Profits of $1.7Bln

Metals giant Norilsk Nickel said Tuesday it had approval to ship platinum and rhodium to world markets, and that its 2000 net profit could rise to $1.7 billion from $531 million in 1999.

President Vladimir Putin has signed a long-awaited decree approving exports of the metals, used to make autocatalysts to clean car exhaust fumes.

Delays in signing the decree sent platinum to 13-year highs and palladium to all-time highs in January.

"We received a quota in a general decree of the Russian president giving quotas for this year for all exporters," Norilsk's first deputy CEO Dmitry Zelenin told a news briefing.

Norilsk needed to wait for approval only for the one-year export quota for platinum and rhodium because it has a 10-year export quota for palladium.

Russia's other exporters of palladium are state precious metals and gems reserve Gokhran and the Central Bank, which both sell through the country's sole export agency Almazzhuvelirexport.

Zelenin said Norilsk was ready to fight against the secrecy surrounding the signing of the quota, and that he hoped the situation would be more transparent by the end of the year.

Secrecy and confusion surrounding the signing of the decree has caused sharp price rallies in all of the platinum group metals in the past few years.

Zelenin said there would be no change in Norilsk's platinum metals output this year.

Figures on production and export of the metals are regarded as state secrets because of their strategic uses, but British refiner Johnson Matthey estimates Russia supplied 161.1 tons of palladium in 2000 and 540,000 ounces of platinum.

Zelenin said Norilsk's 2000 net profit, calculated to international accounting standards, could rise sharply to $1.7 billion from $531 million in 1999.

"According to our very preliminary estimates, the holding's net profit for 2000 amounted to $2 billion to Russian accounting standards and somewhere around $1.7 billion to international standards," Zelenin said.

He said the company planned to propose to its shareholders converting all existing shares into Level One American Depositary Receipts by early May. Level One ADRs are issued on existing capital.

Natalya Loginova, head of Norilsk's shareholder relations department, said after the Federal Securities Commission had registered the swap and its completion in August, holders of RAO Norilsk Nickel ADRs would receive MMC Norilsk Nickel ADRs.

The share swap is taking place as part of a complicated company restructuring plan.

Russia produces around two-thirds of the world's palladium and a third of its platinum.