A significant decrease in production volumes is due to the fact that for 10 months of 2023 the enterprise was idle. It was happened because The State Service of Geology and Mineral Resources of Ukraine (SSGSU) made decision to stop the validity of special permits for the use of subsoil for all mining and processing plants included in the titanium business of Group DF (“Mezhyrichia MCC”, “Valki-Ilmenit”, “Motronovsky MCC”).

The SSGSU made this decision on March 27, 2023, citing the new law on subsoil use. Lawyers for Group DF filed appropriate lawsuits in the courts to challenge the unlawful decision of the SSGSU.

The work of the Mezhyrichia MCC restored in November 2023, immediately after a court decision recognizing the illegality of the suspension of the license by the SSGSU (the department executed the court decision and returned the license for the extraction of titanium ore to the Mezhyrichia MCC on November 7, 2023).

“The entire titanium business of Group DF has experienced a dramatic year. After 7 months of litigation, we received a positive decision in the court of second instance for the Mezhyrichia MCC. This allowed us to restore work, we returned people to production, began paying full salaries, and increased tax deductions.

During the downtime, production volumes and revenue reduced, which led to the reduction in the wage fund by approximately 40% and the transfer of people to “idle work.” In November, we restarted the plant and returned people to work, but legal proceedings continue. If we lose the court of third instance (the Supreme Court of Ukraine), we will be forced to stop the enterprise again, which will lead to the dismissal of hundreds of our workers,” – comments Dmitry GOLIK, director of the Mezhyrichia MCC.

According to Dmitry Golik, local and national budgets suffered direct damage from ill-conceived government policy in the field of subsoil use.

“We can already publish specific figures for the year: in 2023, Mezhyrichia MCC and Valki-Ilmenit paid UAH 84.2 million taxes and fees to budgets of various levels, while in 2022 this figure amounted to UAH 185.4 million. Due to the suspension of the license, budgets at all levels lost more than 100 million hryvnia,” – Golik emphasized.

Today, every 6th employee of the Mezhyrichia MCC serves in the ranks of the Armed Forces of Ukraine. During the war, Group DF businesses, including titanium, provided total assistance in the amount of UAH933.8 million.