MOSCOW, October 7. /TASS/. Severstal has updated the figure of investments in the project of pellets facility construction on the site of the Cherepovets Metallurgical Plant, the Russian steelmaker said.

"Severstal will invest 116 bln rubles ($1.2 bln) in construction of the pellets facility at the Cherepovets Metallurgical Plant. Chief Executive Officer of the company Alexander Shevelev announced the updated figure of investments in the facility, approved by Chairman of the Severstal Board of Directors Alexey Mordashov," Severstal said. The project value was earlier estimated at about 97 bln rubles ($1 bln).

Investments in the project escalated from about 97 bln to 116 bln rubles in the course of further adjustment of process parameters, a Severstal spokesperson told TASS. "Capex grew in the course of further adjustment of project parameters, particularly because of additional innovative environmental solutions and growth of the cost of labor and services of contractors," she noted.

"Investments of such volume are unprecedented for our company and the region of presence. Construction of the pellets plant is the largest project since the time of metallurgical works construction in Cherepovets, both in terms of scales and changes in the production process. We are investing more than one hundred billion rubles in creating a high-technology chain of steel production with a low carbon footprint in the Vologda Region," Shevelev said.

The investment project will also enable the company to abandon the operating agglomeration facility in favor of modern and more environment-friendly processes of working with the iron ore feedstock, the CEO added.