Russia is extracting economic benefits from occupied Ukraine by exploiting Ukrainian infrastructure and logistics networks. The Russian Federal Agency for Railway Transport (Roszheldor) announced on April 21 that the first container train carrying unspecified cargo travelled along the Russian “Novorossiya Railways” network through occupied Ukraine and arrived in occupied Sevastopol. The train’s cargo will be unloaded at Sevastopol and exported via ship through Russian-occupied Black Sea ports to unspecified final destinations. Russian Deputy Prime Minister Marat Khusnullin signed an order in May 2023 creating “Novorossiya Railways” to unite rail lines in occupied Ukraine and Russia by merging them under the auspices of Roszheldor. “Novorossiya Railways” currently operates three lines in occupied Ukraine: the Donetsk branch, the Luhansk branch, and the Kherson-Melitopol branch (linking occupied Kherson and Zaporizhia oblasts), all operated on the basis of railways that Ukraine controlled before the full-scale invasion in 2022. Russia’s use of railways in occupied Ukraine supports two Russian objectives—first, to provide logistical support for Russian troops fighting in Ukraine via rail, which can be quicker and safer than logistical support by vehicles, and second, to transport various goods to Black Sea ports for maritime export. Russia can use these railways to transport goods from Russia to ports in occupied Crimea without having to rely on the Kerch Strait Railway Bridge, which in recent years has been routinely non-operational due to Ukrainian long-range strikes, or to directly take resources from occupied Ukraine and export them to international markets. Radio Free Europe/Radio Liberty (RFE/RL) Crimea service Krym Realii reported on April 21, for example, that Russia is using ports in occupied Kerch to export stolen Ukrainian liquified natural gas (LNG) and grain. The Wall Street Journal found that Russia had sold nearly $1 billion in stolen Ukrainian grain as of September 2024, using railway lines and roads in occupied Ukraine to bring massive amounts of grain to occupied Black Sea ports for export. Ukrainian Mariupol Mayoral Advisor Petro Andryushchenko similarly reported that Russia exported over 12,000 tons of coal via occupied Mariupol during the week of April 14-20 alone.
Despite Russia’s drive to exploit economic resources in occupied Ukraine, some Russian companies are struggling to properly manage coal mines in occupied Ukraine, likely putting residents of occupied areas near these mines at risk. Russian business-focused state outlet RBK reported on April 21 that Russian companies Impex-Don LLC and Donskie Ugli Trading House LLC are ending their leases on nine coal mines in occupied Donetsk and Luhansk oblasts and returning them to the occupation administrations due to high operating costs and low profits. Both these companies began their leases for the nine mines in 2024. The Russian Federal State Budgetary Institution for the Reorganization and Liquidation of Unprofitable Mines (GURSH) will now oversee liquidating (in effect, shutting down) the nine mines. Russia has gone to great lengths to exploit Ukraine’s coal industry and the coal-rich Donetsk Basin, and reportedly exported over $288 million worth of coal from occupied Donetsk and Luhansk oblasts between 2014 and 2022. This number has likely significantly increased since 2022, as Russia now has access to additional mines in Donetsk and Luhansk oblasts. Russia was in the process of liquidating 114 coal mines in occupied Donetsk and Luhansk oblasts as of September 2023. Russia is likely liquidating these mines in part due to the mismanagement of coal mine infrastructure, and also due to volatile international markets. If GURSH fails to close down these coal mines properly, they may degrade in a way that will pose health and environmental risks to nearby communities, namely the Ukrainian residents of these occupied areas.
Key Takeaways:
- Russia is extracting economic benefits from occupied Ukraine by exploiting Ukrainian infrastructure and logistics networks.
- Despite Russia’s drive to exploit economic resources in occupied Ukraine, some Russian companies are struggling to properly manage coal mines in occupied Ukraine, likely putting residents of occupied areas near these mines at risk.
- Russia is actively recruiting teachers from throughout the Russian Federation to teach in occupied Luhansk Oblast as part of the “Zemskyi Uchitel” (“Rural Teacher”) program.
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