They want to sell the MGZ successfully, but first they need to convince the investor not to be afraid of the war

At the Ministry of Economy they said that during the preparation for the privatization of the Mykolaiv Alumina Plant one of the key issues remains insurance against war risks. The state continues preparing the enterprise for privatization, and the listing of the MGZ for auction is planned in 2026. At the same time, for residents of Mykolaiv, Korabelnyi District, the village of Lymany and adjacent areas, the main question remains not only who will buy the plant, but who after the sale will be responsible for the tailings storage facilities, the blowing of red sludge and environmental safety.

This was reported during a briefing on 26 May 2026 by the Deputy Minister of Economy, Environment and Agriculture of Ukraine Daria Marchak. According to the publication, the auction for the sale of the MGZ is planned to be announced only when it becomes clear that there is a real potential buyer.

The question about the Mykolaiv Alumina Plant was raised specifically in the context of the tailings storage facilities. Journalists at the briefing recalled that the region has long had a problem with the MGZ tailings fields, and also drew attention to information about the plant’s preparation for sale. They asked whether safeguards will be provided for the new owner so that, after privatization, the tailings fields do not become a “no one’s” problem.

The government representative replied that environmental and ecological safety issues must be one of the key concerns for any large enterprise, in particular for facilities such as the Mykolaiv Alumina Plant or the Odesa Port Plant.

“Specific details of obligations for investors will be defined in the privatization terms, which must be determined and adopted by the Cabinet of Ministers. Those privatization terms will be developed by the State Property Fund. But environmental obligations, everything that concerns people and the environment, is part of this framework of investment obligations of the potential buyer. So let’s see, we do not yet have developed privatization terms, but under any circumstances the issue of the environment is one of the cornerstones, and no one will put at risk anything that concerns environmental safety,” Marchak said.

However, an important point follows from this answer: the specific privatization terms for the MGZ regarding environmental obligations have not yet been published. That is, at present residents can only hear general assurances that the environment will be taken into account, but they do not yet see a document that would clearly state who, how, with what funds and within what timelines will be responsible for the tailings fields.

According to data previously cited in Korabelov.info materials, the problem of tailings storage for the Mykolaiv Alumina Plant is not new. About 49.4 million tonnes of red sludge have been accumulated on the facilities’ territory, and the Buzkyi Liman is located approximately 300 meters from one of the problematic sites. During 2023–2025 there were 16 recorded incidents of dusting at tailings storage No.2, and on 26 April 2026 uncontrolled dusting from tailings storage No.1 was recorded due to strong winds.

It was precisely after the storm on 26 April 2026 that residents of adjacent settlements again saw red dust from the tailings field rising into the air. Then, according to Korabelov.info, villages in the Mykolaiv district, in particular Lymany, as well as dacha cooperatives were covered by a thick red veil.

Meanwhile, the state continues to advance the privatization of the plant. MGZ is called one of the largest assets of sanctioned property. In 2025 active preparation of the enterprise for privatization continued, and in January 2026 a special sanctions resolution was adopted that defined the rules for selling such assets.

The government representative explained that preparing such a large facility for sale is a complex process. According to her, it is necessary to work through technical and legal issues, prepare transparent documentation, remove or minimize risks for the investor, and also resolve the question of insurance against war risks.

“The Mykolaiv Alumina Plant is a large facility that can generate very high added value for the region, just as it did before the full-scale invasion. But for this it is necessary to work through both technical and legal issues that will affect investment attractiveness. If the facility is not sufficiently well worked out, prepared, with transparent documentation, clear answers to all problematic questions, a clear legal model without risks, then even if the facility is put up for auction, no one will come for it,” Daria emphasized.

According to the official, the absence of news about announcing a tender does not mean that preparations are not underway. On the contrary, she said, the State Property Fund of Ukraine is working on this together with the enterprise’s management. Announcements about the auction should only be prepared once the legal and technical work and audits are completed.

For the state, as the official noted, it is important that the sale be successful, because an unsuccessful auction can send a bad signal to the market.

“As soon as we understand that all the work is done — legal, technical, audits — so that a potential investor will be ready to come to the auction, an announcement about holding the auction will be prepared. In plans for the MGZ, of course, the listing of this facility for auction is planned for 2026. And for us it is very important that when the auction for the sale takes place it is successful, because we understand that unsuccessful auctions are also a signal to the market that we would not want to give,” was stated at the briefing.

Earlier Korabelov.info reported that the Mykolaiv Alumina Plant is planned to be put up for privatization in the fourth quarter of 2026, and the estimated starting price of the enterprise may be $86 million.

Also, in February 2026 it was reported that the MGZ was included in the list of state assets planned to be sold on a priority basis. The asset in question was confiscated from the Russian oligarch Oleg Deripaska.

Another question is who exactly might become the buyer. At the meeting there was a question whether this concerns a profile investor or whether repurposing of the plant is possible. The reply was that the MGZ is being considered specifically as a valuable profile asset for international investors in the aluminum industry.

“From a business point of view the MGZ is a very valuable asset. There are many companies, including international investors, for whom this asset can provide large added value and such importance in the value chain. The question is how to turn this potential interest into real interest that converts into coming to the auction and placing a bid. That is the task. But in our view the MGZ in its profile activity is very interesting for international investors,” was the response.

At the beginning of May 2026 Korabelov.info already reported that the Mykolaiv Alumina Plant attracted interest from a company listed on the New York Stock Exchange. At that time it was about preparing for the privatization of 100% of the enterprise, and among potentially relevant international companies in the aluminum sector mentioned were, in particular, Reliance Inc, Luxfer Holdings PLC and Alcoa Corporation.

However, for residents of Mykolaiv and adjacent settlements the question of the investor is only part of the story. Equally important is whether the privatization terms will strictly define responsibility for the tailings storage facilities, their irrigation, monitoring, prevention of dusting, financing of environmental measures and state oversight.

Because the plant can be sold, the owner can change, but the red sludge near Mykolaiv will not disappear. And that is why the future privatization of the MGZ should be evaluated not only by starting price or investor interest, but also by whether residents will not be left alone with the consequences of the decades-long operation of the industrial giant.

Reminder — previously we wrote:

• Almost 50 million tonnes of sludge and 16 dusting incidents: the MGZ environmental problem reached the Government
• Red sludge from the MGZ again “attacked” nearby villages from the air
• An episode intensified the problem: an ecologist warned about the danger of dust from the MGZ tailings storage
• MGZ is being prepared for sale: the plant in Mykolaiv was valued at $86 million
• Mykolaiv Alumina Plant attracted the interest of a company from the New York Stock Exchange