MOSCOW, February 07, 6:00 /ITAR-TASS/. Russia’s Severstal steel producer plans to invest 976 million U.S. dollars in 2014, including about 487 million U.S. dollars in its subsidiary Severstal Russian Steel.
Of the 487 million U.S. dollars, 150 million U.S. dollars will be invested in development projects including completion of constructing a long product mini-mill in Balakovo (Saratov region), revamping of four-stand continuous tandem cold rolling mill 1700 in Cherepovets, the completion of the development of a specialised steel service centre in Saint Petersburg and the continuing reconstruction and modernisation of the Orel Plant (Severstal Steel Solutions), the company said.
Further, 288 million U.S. dollars will be invested in a combination of maintenance and health and safety improvement projects at the division in 2014.
The company said its investment policy would be continuously focused on key elements of its strategy, specifically: enhancing operational efficiency; reducing operational and administrative costs; further improving the product mix; customer care, and; continuous improvement to health and safety. Planned capital investment in environmental projects in 2014 is about 68 million U.S. dollars.
Planned investment at resources operations in 2014 is approximately 404 million U.S. dollars, of which 195 million U.S. dollars will be invested in development projects including the operational consolidation of the Vorkutaugol’s Zapolyarnaya and Vorkutinskaya mines including the construction of an incline shaft at Zapolyarnaya, the construction of a new water rotation unit and enhancing stripping works at Karelsky Okatysh, further progress on increasing production capacity at the Pechorskaya Preparation Plant and others.
Spending on the maintenance of coal and iron ore operations and health and safety improvement projects are planned to be 209 million U.S. dollars.
The company plans to invest approximately 85 million U.S. dollars in Severstal North America and 73 million U.S. dollars in maintenance projects.
Alexei Kulichenko, Severstal chief financial officer, said: “Severstal maintains a prudent approach to capital expenditure, which is flexible to market conditions and determines that we invest only in development projects that meet our strict criteria on returns. Our 2014 investment programme will enable us to further enhance Severstal’s efficiency and continue to generate healthy free cash flow whilst developing our market-leading product and service standards.”
Severstal is one of the world’s leading vertically integrated steel and steel related mining companies. With approximately 63,000 employees, it has assets in Russia and the United States, Italy, in Ukraine, Latvia, Poland, and Liberia.
Severstal is listed on RTS and MICEX and the company’s GDRs are traded on the LSE. Severstal reported revenue of 14,104 million U.S. dollars and EBITDA of 2,119 million U.S. dollars in 2012. Severstal’s crude steel production in 2013 reached 15.69 million tonnes.
The company has 3 divisions: Severstal Resources, Severstal Russian Steel, and Severstal International.
Alexei Mordashov, Severstal director general and principal owner, holds 79.2 percent of the company’s shares.