NAIRIT WILL RESUME RUBBER PRODUCTION BY APRIL 15, ARMENIAN MINISTER OF ENERGY SAYS

Noyan Tapan
March 24, 2009

YEREVAN, MARCH 24, NOYAN TAPAN. At the March 20 court sitting of the
RA Administrative Court, Nairit chemical plant, whose debt to Electric
Networks of Armenia (ENA) company amounts to about a billion drams
(about 2.5 million USD), assumed an obligation to pay the debt for
supplied power until late March.

The ENA had applied to court with the request to declare Nairit
bankrupt, thus trying to "officially find out the financial
possibilities" of one of its largest consumers.

The Director General of Nairit Plant CJSC Vahan Melkonian (who was
in Moscow on the day of the court sitting) told Radio Liberty by
phone that he intended to sign new agreements in Russia and pay the
previous debts. "The plant’s assets exceed many times the sum, due
to which an attempt is being made to declare the plant bankrupt. It
is not a tragic sum," V. Melkonian said.

The expenses on power bearing substances at the plant make up about 70%
of the cost price of rubber. The plant’s overall debt makes about 45
million USD, including arrears of wages of 600 thousand USD.

However, the Director of ENA Yevgeny Gladunchik is not
optimistic. "Nairit gets by rather than operates. The principle of
its work is to survive somehow. This is the problem. And it is not
the first failure. During all the time I have been working with them,
they have always said that they will have money tomorrow. This tomorrow
has lasted 6 years," he noted.

The Armenian government is 10% shareholder of Nairit plant. According
to RA minsiter of energy Armen Movsisian, the situation at Nairit plant
was caused by the economic crisis. "The circulating assets that became
production have remained in warehouses. Time was needed so that prices
would become stable and a market for production’s sale would be found,"
the minister said. He stated that the plant, which has been standing
idle since December 1, 2008, will resume rubber production by April 15.