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Severstal Granted Exploration and Extraction Rights for N1 coal field at Usinskoe
12/30/2011 - OAO Severstal’s OAO Vorkutaugol coal production unit recently won exploration end extraction rights for the N1 coal field at the Usinskoe deposit in the Komi region, Russia.
OAO Severstal’s OAO Vorkutaugol coal production unit recently won exploration end extraction rights for the N1 coal field at the Usinskoe deposit in the Komi region, Russia.
The company’s winning bid for the coal field, which has estimated resources of 620 million tonnes of coking coal, was more than 1.3 billion roubles.
The coal field, which will be developed as an underground mining project, will require the construction of an underground mine and a coal-preparation plant. The planned production volume is over 4 million tonnes of coal per annum. Total capex for the construction of the mine, the coal-preparation plant and support infrastructure is estimated at 29 billion roubles.
The N1 coal field, which is located in the center of the Usinskoe deposit, benefits from close proximity to key transport and infrastructure links. The Kotlas-Vorkuta railroad is 5 km from the Southern board of the coal field, and the Khanovei railroad station is located 30km from it.
The coal field has estimated resources of 620 million tonnes of coking coal, most of which is high-rank (Russian classification – 2Zh) and is similar in quality to the resources of the Vorkuta deposit, which is also being developed by Vorkutaugol. The field’s resources include KZh and 1Zh coal (Russian classification).
OAO Vorkutaugol is to receive the license agreement for the Usinskoe deposit’s N1 coal field and start to develop the coal field at the beginning of 2012. According to the license agreement construction must be started no later than January 2017. Commissioning is scheduled for 2020, with operating capacity to be achieved by 2023.
ОАО Severstal is one of the world’s leading vertically integrated steel and steel related mining companies, with assets in Russia, the USA, the Ukraine, Latvia, Poland, Italy, Liberia and Brazil. In 2010, Severstal reported revenue of $13,573 million, EBITDA of $3,263 million, and crude steel production of 14.7 million tonnes.
OAO Vorkutaugol, which is a part of OAO Severstal’s Severstal Resources mining division, is one of Russia’s largest coal producers. In 2010 Vorkutaugol produced 8.1 million tonnes of commercial products, the majority of which is coking coal concentrate. Currently Severstal Resources includes four production complexes, which produce more than 14 million tonnes of iron ore concentrate and pellets and 11.5 million tonnes of coking and steam coal concentrates per year.
