Media: Oligarch Kolomoyskyi Sets Up Large Mining Farm at Zaporizhstal Ferroalloys Plant

In 2021, at the Zaporizhstal Ferroalloys Plant, which is linked to Ukrainian oligarch Ihor Kolomoyskyi, a large batch of equipment for cryptocurrency mining from Georgia and China was delivered. This is reported in the Schemes project investigation.

According to journalists, since February the Georgian company Georgian Manganese supplied 2,600 mining devices from Bitfury. In parallel, almost 12,500 devices from Bitmain were received by the Zaporizhstal plant from two Hong Kong firms. Supplies continued in the following months.

The total value of the mining equipment brought to the plant in 2021 is estimated at nearly 750 million hryvnias (about $27.6 million at the time of writing).

Journalists also calculated that if all the purchased devices were run around the clock at full power, they could yield about 80 BTC per month (nearly $4 million).

At the same time, the plant was receiving cheap electricity from Energoatom through the company United Energy, which is also linked to Kolomoyskyi, the investigation notes. In December 2020 Energoatom’s subdivision put a large volume of electricity up for auction at a discount. The majority of it was bought by United Energy — instead of the initial price of 1.4 hryvnia per kWh, the private company paid 1.15 hryvnia.

Law enforcement are examining the legality of this procurement.

Subsequently, United Energy supplied the purchased electricity to a number of Kolomoyskyi-affiliated enterprises from January to June 2021, journalists found.

The head of Zaporizhstal, Pavlo Kravchenko, explained that organising a mining farm at the plant was necessary to earn money given the lack of demand for the ferroalloys’ main product. He says the equipment has been installed, but not yet switched on.

Kolomoyski declined to comment.

In late 2020, it was reported that at the CC Metals & Alloys plant in Kentucky, owned by the Ukrainian oligarch and his business partners, a data centre appeared where a third party mines cryptocurrencies.

In February, Kolomoyskyi disclosed to a London court investments in a Georgian mining farm in 2017. The project also involved the aforementioned Georgian Manganese.

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