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MMK Renews Commitment to Modernization Effort

04/08/2009 - Magnitogorsk Iron and Steel Works renews its commitment to ongoing modernization efforts, which include a rolling mill upgrade as well as installation of a new slab caster and new secondary steel treatment unit.

Magnitogorsk Iron and Steel Works (MMK) has renewed its commitment to its ongoing modernization efforts by signing a number of contracts for the delivery of equipment and services as well as loan agreements to finance the upgrade projects.
 
MMK signed a contract with ALTA, a.s., Czech Republic, for delivery of equipment and erection supervision services for its 2500-mm Rolling Mill Revamping Project OJSC. MMK also signed a contract with PSG International a.s., Czech Republic, for related construction and erection services.
 
When completed, the rolling mill upgrade will allow the company to broaden its product mix in terms of dimensions and grades. The upgraded mill will be capable of rolling strip thicknesses of 1.2 to 25.0 mm (vs. the current 1.8 to 14.0 mm), widths of 1000 to 2350 mm, in coils weighing up to 40 tonnes. The upgrade will also help to minimize both power and material consumption while boosting product quality, allowing the mill to provide high quality coils for cold rolling and coating, and cut hot rolled coils into lengths to customer specifications.
 
The revamped mill will be supported by three high-capacity (370 tonnes/hour) walking beam furnaces, a group of roughing stands, a pre-finishing stand, an intermediate roller table, coiler, coil transportation and removal line, and cut-to-length line. A 12 MW gas turbine station will supply heat and steam to the mill. MMK said the main process equipment for the mill would be manufactured by the Novokramatorsk Mechanical Engineering Plant, Ukraine, with ALTA acting as general supplier of both main process and off-contract equipment.
 
MMK also signed a contract with PSG International related to its project to build Continuous Slab Caster No. 6 and a secondary steel treatment unit in its BOF Shop. To finance these projects MMK and the Czech Export Bank executed loan agreements for a total amount of USD 155.5 million.
 
MMK is building Continuous Slab Caster No. 6 as part of its 5000-mm Plate Mill Project. The new single-strand radial curvilinear casting machine will have an annual capacity of up to 1.8 million tonnes. The contract for the delivery of the caster's equipment was signed in November of 2006 with SMS Demag, Germany, with Uralmash, Russia, Siemens-VAI, Austria, and Danieli, Italy, also taking part in the equipment manufacture. The total cost of the project, scheduled to go on-stream in the 4th quarter of 2009, is estimated at USD 200 million.
 
Construction of the Secondary Steel Treatment Unit in the BOF Shop is also part of the 5000-mm Plate Mill Project. The new unit will feature state-of-the-art equipment including a twin-station ladle furnace, twin-station circulation-type vacuum degasser, steel ladle deslagging stand, and a blending unit for soft steel blowing. With a capacity to treat at least two million tonnes of steel per year, the new unit will be capable of treating all steel grades produced by the BOF Shop, including steels for straight joint large-diameter pipes with an enhanced resistance to hydrogen sulfide, and corrosion-resistant pipes with a class of strength of X80 and higher, as well as special purpose steels, shipbuilding and boiler steels, automotive steels (ultra low carbon, high-strength, dual-phase, multi-phase, TRIO steels), and steels for white goods manufacturing. The EUR 40 m contract for the delivery of the key process equipment was signed in 2007 with SMS MEVAC, Germany.
 
The new caster and secondary treatment unit will provide the 5000-mm Plate Mill with high-quality 190-, 250- and 300-mm thick slabs that are up to 2700 mm wide, thus enabling MMK to set up a complete cycle for production of plate for the pipe sector, bridge, ship and boiler builders.
 
 “The Russian market remains a priority for MMK,” said Victor Rashnikov, President of the MMK Managing Co., commenting on the contracts and loan agreements. “In the current situation, the replacement of imports from foreign manufacturers with domestic products and raising the quality of such products has a tremendous importance for the Russian economy. I am certain that the implementation of these projects will allow us to meet the strictest requirements of our customers and help strengthen MMK's competitive position.”
 
Contracts and loan agreements were signed by Victor Rashnikov, MMK Managing; Vladimir Plašil, Chairman of ALTA's Board of Directors; Yuraj Surovič, Vice Chairman of the Board of PSG International; and Lubomir Pokorny, Chief Executive Officer of the Czech Export Bank. The signing ceremony was attended by the Czech Minister of Industry and Trade Martin Řiman, the Czech Ambassador in the Russian Federation Miroslav Kostelka, and officials of the Czech Ministries of Foreign Affairs and Finances.
 
The Magnitogorsk Iron and Steel Works OJSC (MMK) ranks among the world's largest steel producers and is one of the leaders of Russia's steel industry. The company is a large steel producing complex encompassing the entire production chain, from preparation of iron ore to downstream processing of rolled steel.  MMK turns out a broad range of steel products with a predominant share of value added goods. In 2008, the company produced about 12 million tonnes of crude steel, and about 11 million tonnes of commercial products.
 
ALTA is a leading supplier of technology and equipment for the energy, machine tools and mining sectors. As a general contractor, ALTA provides a broad range of services in marketing, design, engineering and finances. Its activity is mainly focused on Russia and other CIS countries, where it specializes in exporting machine tools and metal-working equipment, technology for mining and processing mineral resources and technology and equipment for the manufacturing of construction materials. Its import operations are focused on supplying large quantities of iron ore materials, steam coal and fuel for the steelmaking and energy sectors.