Mechel Announces Signing Cooperation Agreement on Supplies of Elga Complex’s Coal Products with RAO Energy Systems of East
Moscow, Russia — September 10, 2012 – Mechel OAO (NYSE: MTL), one of the leading Russian mining and metals companies, announces the signing of a cooperation agreement for supplying OJSC “RAO Energy Systems of East” with coal from Elga Coal Complex.
As part of an official meeting during the Business Summit of the Asia Pacific Economic Cooperation (APEC), Mechel Mining OAO, which consolidates Mechel Group’s mining assets, and OJSC “RAO Energy Systems of East” signed an agreement for cooperation for supplies of the Elga deposit’s coal. The agreement was signed by Mechel Mining OAO’s Chief Executive Officer, Igor Zyuzin, and OJSC “RAO Energy Systems of East”’s Chief Executive Officer, Sergey Tolstoguzov.
The agreement sets forth the key principles of the two sides’ long-term cooperation regarding the use of coal from the Elga deposit. Once probes of Elga’s coals are delivered to OJSC “RAO Energy Systems of East” subsidiary JSC “DTE” and in case test burning yields positive results, Mechel Mining may gradually increase supplies of the Elga deposit’s coals up to a total of 60 million tonnes over 15 years.
“Mechel has longstanding partnership ties with DTE. For many years, DTE’s Neryungri and Khabarovsk power stations were supplied with steam coal from Neryungri Open Pit, which is part of Yakutugol. Signing the cooperation agreement for supplies of Elga’s coal with RAO Energy Systems of East is a new stage in the business ties between our companies. What is particularly important, this agreement will ensure guaranteed sales of products from Elga Coal Complex, which is a priority development project for our company, on the Russian coal market,” Mechel Mining OAO’s Chief Executive Officer Igor Zyuzin noted.
Mechel is one of the leading Russian companies. Its business includes four segments: mining, steel, ferroalloy and power. Mechel unites producers of coal, iron ore concentrate, nickel, ferrochrome, ferrosilicon, steel, rolled products, hardware, heat and electric power. Mechel products are marketed domestically and internationally.