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Severstal Plans US$1.7 Billion Target Capital Investment Program for 2012
02/28/2012 - OAO Severstal announced plans to invest US $1.7 billion in 2012, including further modernization and improvement of its operations, raising standards for health & safety, and development of new projects both in Russia and internationally.
OAO Severstal announced plans to invest US $1.7 billion in 2012 to support its growth and long-term competitive strategy, with priorities including further modernization and improvement of its operations, raising standards of health & safety, and development of new projects both in Russia and internationally.
The company said that Severstal Russian Steel’s investments for 2012 will total approximately US $905 million. Investments are to include continued construction of a mini-mill in Balakovo in Russia’s Saratov Region; renovation of various other production units; and projects to further develop and improve IT infrastructure and customer care.
The company plans to invest approximately US $659 million at Severstal Resources in 2012, where key projects will include modernization of coal and iron ore mines and ore-dressing plants and coal preparation plants as well as installation and implementation of new equipment; commissioning of a thermoelectric power station burning coalmine methane in Vorkuta; and development of greenfield-projects in Tuva (Russia), Lyberia and Brazil.
At Severstal North America, the company plans to invest approximately US $104 million in 2012. Projects will include maintenance & development projects as well as developing environmental programs, health & safety, IT-infrastructure and customer care.
The company noted that overall, the level of 2012 capex is in line with that of 2011 (excluding Nordgold).
“Funded by our strong balance sheet we will invest significantly in the company’s assets in Russia, which, in line with our stated strategy, will be the focus of our 2012 investment program, as well as in the completion of the modernization program at Severstal NA,” commented Alexey Kulichenko, CFO of Severstal. “We will also continue to search and analyze new investment opportunities, which will help us to achieve the company’s key strategic goal of being one of the global industry leaders by EBITDA.”
Severstal, one of the world’s leading vertically integrated steel and steel related mining companies, combines the growth potential of Russia’s emerging market with the margin sustainability of an international steel producer. The company currently operates facilities in ten countries and employs a workforce of 84,000.
