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. Last Updated: 07/27/2016

Uranium Mine's Fate Hinges on Putin's Men

What happens at the Krasnokamensk uranium mine is likely to depend on decisions made by the new head of the Federal Atomic Energy Agency, Sergei Kiriyenko.

President Vladimir Putin appointed the Western-leaning, pro-market former prime minister last month and assigned him the task of rebuilding Russia's flagging nuclear industry.

So far, talk of Kiriyenko's plans for the agency, known as Rosatom, has centered on making it more commercial, by improving profits from sales of Russia's nuclear know-how and supplies abroad, and investing more in the modernization of Russia's aging nuclear power plants.

But, without a decision on whether to invest more in extraction projects such as Krasnokamensk, other measures could end up as just short-term solutions. Without supplies of uranium ore, other nuclear projects could become increasingly irrelevant as the industry would become less and less self-sustaining.

The head of Rosatom's information center, Maxim Shingaryov, said Kiriyenko was still in discussions with other agency officials on how to move forward.

Some industry insiders expressed doubts that outsiders like Kiriyenko could help.

"Unfortunately, more and more people are being hired from the outside. ... Many of them just don't understand the industry," said Gennady Pshakin, who heads an analytical center on nonproliferation in the nuclear reactor town of Obninsk, outside Moscow. "They don't know the history of these combines. It is very difficult for them to understand what the root of the problem is and how to solve it as quickly as possible."

Putin has appointed people close to him to some of the most important posts in the nuclear industry, including as heads of the two state-owned nuclear fuel trading agencies, TVEL and Tekhsnabexport, or Tenex.

Fuel originating in Krasnokamensk is sold through both agencies to foreign partners. Having the end product sold abroad via two middlemen muddies the picture even further for the Krasnokamensk combine and makes it even harder to work out where the profits go.

TVEL is headed by Alexander Nyago. Before Putin appointed him in 2001, he was general director of Telekominvest, a St. Petersburg-based telecommunications holding company that Leonid Reiman, now the IT and communications minister, helped found, and which is now entangled in a money-laundering investigation in Europe and the United States.

Vladimir Smirnov, the president of Tenex, is another Putin ally from St. Petersburg, who also was appointed in 2001. He had headed up the St. Petersburg office of the real estate firm SPAG, which has been investigated for suspected money laundering in Germany and which counted Putin as the head of its supervisory board when he was deputy mayor in St. Petersburg in the early 1990s.

Both Telekominvest and SPAG deny any wrongdoing.

The Krasnokamensk mine and processing plant are owned by TVEL, a joint stock company that is wholely owned by the state. Rosatom supervises TVEL and has its representatives on the company's board of directors.