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Cablegate: Extrancheck: Pre-License Check: Ptk

VZCZCXYZ0003
PP RUEHWEB

DE RUEHMO #1595 1570629
ZNR UUUUU ZZH
P 050629Z JUN 08
FM AMEMBASSY MOSCOW
TO RUCPDOC/USDOC WASHDC PRIORITY
INFO RUEHC/SECSTATE WASHDC 8421
RHMFIUU/US CUSTOMS AND BORDER PROTECTION WASHINGTON DC

UNCLAS MOSCOW 001595

SIPDIS

USDOC FOR 532/OEA/MHAMES/LRITTER
USDOC FOR 3150/USFCS/OIO/CEENIS/MCOSTA

E.O. 12958: N/A
TAGS: BEXP ETRD ETTC RS
SUBJECT: EXTRANCHECK: PRE-LICENSE CHECK: PTK
ELECTROSTEEL LLC, MOSCOW, RUSSIA, LICENSE NO. D397317

REFTEL: USDOC 03408


1. Unauthorized disclosure of the information provided
below is prohibited by Section 12C of the Export
Administration Act.

2. Reftel requested a pre-license check to determine
the legitimacy and reliability of the end-user, PTK
Electrosteel LLC, Moscow, Russia. The company is
listed on BIS license application D397317 as the
ultimate consignee of the HAAS Manufactured ES-5-4T, a
horizontal machine with 40" X 18" X 22" (XYZ) travels,
imbedded 4th axis and a 5-axis option making this
machine capable of 5-axis simultaneous contouring.
These items are controlled for national security and
non-proliferation reasons under ECCN 2B001. The
licensee is HAAS Automation Inc., 2800 Sturgis Road,
Oxnard, CA 93030.

3. On June 3, 2008, Export Control Attach Peter
Liston and LES Natalya Shipitsina conducted the
requested pre-license check at the offices of
Electrosteel LLC, B. Andronevskaya 23, Moscow, Russia.
The export control team met with Boris Dolgikh,
General Director of Electrosteel LLC.

4. General Director Boris Dolgikh told the export
control team that Electrosteel LLC was founded in
2000. Dolgikh stated that Electrosteel LLC has been
producing unfinished stamped banks and casting blanks
of turbine blades for various Russian industries for 7
years. Electrosteel LLC then subcontracts the
unfinished turbine blades to be refined and finished
to the required specifications of the customer.
Electrosteel LLC employs 25 people and grosses
approximately $10 million dollars a year.

5. Dolgikh told the export control team that
Electrosteel LLC intends to purchase the commodity in
reftel through the HAAS Automation Inc. Moscow
representative. Dolgikh stated that he often attends
industry trade show and exhibitions and that that is
where he learned of the reftel commodity. Dolgikh
stated that reftel commodity would enable Electrosteel
LLC to produce their own finished product, a chrome
steel turbine blade. Dolgikh stated that his company
would no longer be dependant on subcontracting out the
finishing work.

6. Electrosteel LLC appears to have the technical and
commercial sophistication and the physical resources
consistent with those for which the commodity in
question was designed. It should be noted here that
if the license is granted, and Electrosteel LLC goes
through with the purchase from HAAS, they intend to
purchase a commercial property within 100km of Moscow
where they will build a production facility. The
Export Control Team would recommend a Post-Shipment
Verification in that event.

7. The export control team believes that Electrosteel
LLC has both a legitimate need and a legitimate end
use for the subject reftel commodity.

8. Recommendations: Post recommends Electrosteel LLC,
Moscow, Russia, as reliable recipients of sensitive
U.S. origin commodities. It is requested that post be
notified of final disposition of the application, and
of any shipments for this organization in order to
conduct appropriate FCS follow-up and statistical
reporting.
(FCS MOSCOW/SBOZEK/PLISTON)
RUSSELL

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