13th Jul 2007 13:29
OAO Severstal13 July 2007 SEVERSTAL For Immediate Release13 July 2007 A Memorandum of Intent between the Administration of the Saratov Oblast and OAO Severstal about the construction of a new reinforcing steel mini mill in the region will be signed on July 18, 2007. The Governor of the Saratov Oblast, Pavel Ipatov, and Anatolyi Kruchinin,General Director of OAO Severstal's Cherepovests Iron and Steel Work, will signon July 18 in Saratov a framework Agreement of assistance in the implementationof a project for the construction of a reinforcing steel mini mill in themunicipal unit Bykovo-Otgorskoe, located 160 km from Saratov. The annual output of the new enterprise to be commissioned in 2010 will be 1 MTof bar sections. Around 400 new jobs will be created in the region as a result.Projected investments will be about $500 million. The mini mill will use metalscrap as a feedstock eliminating the first "black" processing cycle, which willpractically reduce the environmental impact to zero. Logistics of the productionprocess and supplies under the new project will be presented at the InvestmentCommittee of the Saratov Oblast in late July. As emphasized by Mr Kruchinin, "the location of the construction of this planwas not chosen by chance. The Russian construction market keeps growing. Overthe last year alone, the use of reinforcement in Russia increased by 30%. TheSaratov region and the Privolzhsky market have a shortage of bar product.Severstal's experience of producing quality reinforcing steel at theCherepovests Iron and Steel Work enables this problem to be resolved in thefuture. Even today quality heat strengthened reinforcing steel, grade A 500 C,which is in maximum demand on the market, accounts for about 80% of totalshipments to Russian construction companies." According to Mr Kruchinin, sales to the construction sector in Russia's domesticmarket are seen as strategic by Severstal. OAO Severstal Russian steel makers -CherMK Severstal and Trade House Severstal-Invest - supplied about 1.5 milliontons of metal products to the construction market in 2006. For further information please contact: Severstal, Investor Relations - RussiaDmitry DruzhininSeverstal, Public Relations - RussiaNatalia Ivanova+7 495 540 77 66 Tulchan Communications - UKDominic Fry/Tom Murray+44 207 353 4200 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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