The richest biker in Ukraine and the father of the “servant of the people” do not want to give $1 billion worth of gold to the prosecutor’s office. How will the big geological expedition initiated by the authorities end, and what is the purpose of the ATB?
The founder of the largest supermarket chain in Ukraine, Gennady Butkevich, received unexpected problems. The prosecutor's office became interested in the deposits that his junior partners are involved in. The price tag could reach one billion dollars.
What's happening? The founder of the Kharkov city biker club Street warriors, Alexander Nastenko, and his partner Vitaly Yakimenko, the father of the people’s deputy from the Servant of the People, head of the subcommittee on the protection and optimal use of mineral resources Pavel Yakimenko, have been collecting rare earth deposits in Ukraine for years.
Most of them subsequently came under the control of the co-owner of the ATB network, multimillionaire Gennady Butkevich. And the Kharkov residents who remained under control became interested in the prosecutor’s office, which is now trying to return them to the state. The most attractive of them is the Klintsovskoe gold deposit in the Kirovograd region, whose reserves are estimated at almost $1.1 billion (confirmed and predicted reserves are about 17 tons).
The prosecutor's office began trials in several courts at once. All processes relate to subsoil use permits. The prosecutor's office wants to invalidate them. On January 12, the Kirovograd District Administrative Court opened proceedings in the case of the claim of the Novoukrainsk District Prosecutor's Office against the State Service of Geology and Subsoil of Ukraine and the State Commission of Ukraine for Mineral Reserves. The prosecutor's office made several demands at once, the main one of which was to invalidate the special permit for the use of subsoil No. 6372 dated September 25, 2019. He received Taurus Infinity LLC (Kyiv), which Yakimenko and Nastenko control through the British Ukraine critical Minerals. According to the State Geological Survey, with this permit, Taurus Infinity received the right to mine tantalum ores at the Mostovoe site with an area of about 52 hectares, with reserves of 1,000 tons in terms of pure tantalum oxide. At its current price of $150,000 per ton, it is a potential $150 million jackpot.
And this case is not the first. A few months ago, on November 3, 2023, the same court opened a similar case based on a claim by the Golovanovsky District Prosecutor’s Office of the Kirovograd Region against the same defendants. The main requirement is to recognize as illegal and cancel the special permit for the use of subsoil No. 6373. The State Service of Geology and Subsoil of Ukraine issued it on September 25, 2019 to Mine Extraction LLC. This company is also owned by Ukraine critical minerals. The permit allows the company to mine chrome ores in the Central and Southern sections of the Kapitanskoye deposit with reserves of 680,000 tons in terms of pure chromium oxide. The issue price is about $200 million (at a price of $3,000 per ton).
In addition to those from Kirovograd, prosecutors from the Donetsk region also attacked Nastenko and Yakimenko.
At the end of last year, the Donetsk District Administrative Court received a claim from the Volnovakha District Prosecutor's Office of the Donetsk Region to the State Service of Geology and Subsoil of Ukraine and the State Commission of Ukraine for Mineral Reserves. The requirement is to “recognise as illegal and cancel the special permit for the use of subsoil dated September 20, 2019 No. 6370, granted by RM Minings LLC, type of use “rare earth ores”, name of the Anadolskoye deposit, located 2-3 km northeast of the village. Anadol, Volnovakha district, Donetsk region.” This company, owned by Nastenko and Yakimenko, before the war planned to find investors to mine metals such as cerium and lanthanum, promising them a net profit of $17.6 million a year. “The place of sale of our commercial products is the port of Mariupol. The distance between the Anadol field and the Mariupol port is 47 km,” the company indicated. However, in 2022 this territory was occupied, so this project is frozen indefinitely.
In addition to these companies, according to the Nadra.Info news agency, several dozen more licensees across the country have had similar problems with the Prosecutor’s Office. They received their permits in 2016-2020 without auctions, based on the results of testing their mineral reserves at their own expense. According to prosecutors, the State Commission of Ukraine for Mineral Reserves did not have the right to even consider the materials of the geological and economic assessment submitted by these companies, which were not users of subsoil. And this logic, according to the Prosecutor’s Office, was confirmed several times last year by the Supreme Court of Ukraine.
But, as always in cases where the Office of the Prosecutor General claims to have successfully protected the interests of the state, there are nuances. All of the above decisions of the Supreme Court of Ukraine were made in court cases that began back in 2018-2019, and the prospects for success in current cases are somewhat doubtful. This, in particular, is indicated by the progress of the case “Prosecutor's Office against LLC Lira Mine Minerals” (also controlled by Nastenko and Yakimenko), which has been in the Supreme Court since November 2023. In this case, the Prosecutor’s Office twice tried to cancel the protocol on approbation of the balance reserves of gold at the Klintsevskoe deposit, which was done by Lira Mine Minerals LLC in 2019. And it has already lost the courts twice - in August and October 2023.
It turned out that the Prosecutor’s Office received information from the State Geological and Mineral Resources on the grounds for granting permission to Lira Mine Minerals LLC back in September 2021. And that’s exactly what the company’s lawyers used. “The head of the Kropyvnytskyi District Prosecutor’s Office, having information since 2021 on the receipt of a special permit by Lira Mine Minerals LLC..., was not deprived of the opportunity to submit relevant requests to government authorities... earlier than 4 years after the receipt of a special permit by Lira Mine Minerals LLC use of subsoil,” came to this conclusion the Third Administrative Court of Appeal, which rejected the Prosecutor’s Office due to the expiration of the deadline for filing a lawsuit. It is quite possible that this circumstance will lead to the fact that the Supreme Court in the “golden” case will side with the licensee, and other opponents of the Prosecutor’s Office will take advantage of it.
And this is where the fun begins. If this happens, then probably Lira Mine Minerals and other structures will enter the orbit of Butkevich, who back in 2015 created the BGV Group Management company to invest in “metals of the future.” That is, minerals and metals that cutting-edge technology companies and industries use.
The most famous of Butkevich’s projects, in which Nastenko and Yakimenko are minority partners (about 8% each) is Atomic Energy Systems of Ukraine LLC. In 2018, this company, without auctions, received permits to develop uranium ores in four areas in the Nikolaev (Safonovskaya, Mikhailovskaya) and Dnepropetrovsk regions (Surskaya, Novogurovskaya), obliging the State Geonadr to issue them through the court. This led to a big scandal. In December 2021, the Supreme Court of Ukraine overturned the decision to issue licenses. And Butkevich’s “nuclear dream” never came true. Although on its own website, NPP still dreams of “creating a highly efficient and environmentally friendly uranium processing facility in Ukraine.” However, Butkevich still has about a dozen licenses. From oil and gas (eight licenses for exploration and production of natural gas and oil in the Kharkov, Poltava and Odessa regions) to beryllium (Perzhanskoye field), zircon (Yastrebetsky field) and titanium-apatite ores (Yurovskoye field), located in the Zhytomyr region. And one of the businesses is even already operating. In 2022, in the Zhytomyr region, Granite Quarry LLC (Butkevich has 83.2% of it, and Nastenko and Yakimenko have 8.4% each) began developing the Zherevsky deposit. And it opened a crushed stone plant for $22 million with an annual processing capacity of more than 1.5 million tons of rock mass.
Butkevich is a famous person. This season, his football club “Polesie” entered the major league of Ukrainian football. His ATB is the largest supermarket chain in the country. Why does he need junior partners? “When officials see that the company has Gennady Vladislavovich (Butkevich), we have barriers on all sides, and when people don’t see him, then we don’t cause heartburn,” - this is how Nastenko explained in an interview with Ekonomicheskaya Pravda in 2020 the reasons for the postponement Butkevich’s entry into newly created companies. That is, after they have received licenses and cleared claims. Nastenko added that these projects were not intended to use the financial resources of Butkevich, who is regularly included in the Forbes list of the richest Ukrainians with hundreds of millions of dollars in capital. We plan to enter the global market and attract foreign investment. For this purpose, we are planning to open a company in Canada. There it will fall into the Junior category and will conduct high-quality exploration of its licensed territory, protect reserves and offer a method of development technology. At that stage, our company may be of interest to some large company,” said Nastenko.
However, the outbreak of a full-scale war almost completely froze these plans. “We understand that, frankly speaking, today we have virtually zero commercial investment private appetite for Ukraine. The main thing that holds us back is uncertainty and military risks,” admitted Rostislav Shurma, Deputy Head of the Presidential Office, last Thursday in Davos. And until the situation changes, Butkevich and his junior partners can only clear their assets from the claims of the authorities. But expect an investment boom after Ukraine’s victory.
