ORSK, Russia, May 7 /PRNewswire-FirstCall/ -- Mechel OAO (NYSE: MTL), oneof the leading Russian mining and metals companies, announces that itssubsidiary, Southern Urals Nickel Plant OAO, and Bateman Engineering havesigned a contract on the construction of a new melting complex for Mechel'snickel plant.
The contract, which is signed in accordance with the investment program ofSouthern Urals Nickel Plant, provides fundamental re-equipment of the plantand includes the design and supply of a 12 MW DC furnace. The furnace will beerected at Southern Urals Nickel's existing facility. The total project valueis US$31 million.
The fixed price contract will be performed against a defined scope of workfor small-scale industrial furnace-complex equipment for the production offerronickel. The contract will also include a basic engineering package forthe entire process plant and detailed design and supply of the core technologyequipment for the 12 MW DC furnace. Work is expected to commence in thenearest months and the project is due to be completed by the end of 2009.
The 12 MW plant will be designed to include the latest proven technologyin the field of ferro smelting and environmental protection. The technologyhas been designed by employing a holistic process approach to achieve lowoperating costs and high recoveries along with high levels of reliability.
'The Southern Urals Nickel Plant has embarked on a modernization andexpansion program for its nickel operations in order to boost production andoperate efficiently. The 12 MW furnace is the first phase in this programwhereby, in addition to producing a quality saleable product, it will be usedto assess the commercial viability of a significantly larger project,' MechelManagement OOO Chief Executive Officer Vladimir Polin commented.
Mechel is one of the leading Russian companies. Its business includesthree segments: mining, steel, and power. Mechel unites producers of coal,iron ore concentrate, nickel, steel, rolled products, hardware, heat andelectric power. Mechel products are marketed domestically and internationally.
Some of the information in this press release may contain projections orother forward-looking statements regarding future events or the futurefinancial performance of Mechel, as defined in the safe harbor provisions ofthe U.S. Private Securities Litigation Reform Act of 1995. We wish to cautionyou that these statements are only predictions and that actual events orresults may differ materially. We do not intend to update these statements. Werefer you to the documents Mechel files from time to time with the U.S.Securities and Exchange Commission, including our Form 20-F. These documentscontain and identify important factors, including those contained in thesection captioned 'Risk Factors' and 'Cautionary Note Regarding Forward-Looking Statements' in our Form 20-F, that could cause the actual results todiffer materially from those contained in our projections or forward-lookingstatements, including, among others, the achievement of anticipated levels ofprofitability, growth, cost and synergy of our recent acquisitions, the impactof competitive pricing, the ability to obtain necessary regulatory approvalsand licenses, the impact of developments in the Russian economic, politicaland legal environment, volatility in stock markets or in the price of ourshares or ADRs, financial risk management and the impact of general businessand global economic conditions.
SOURCE Mechel OAO
