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Mechel

October 25, 2007

Mechel announces commissioning of two drawing mills at its Beloretsk Metallurgical Plant subsidiary

Beloretsk, Russia – October 25, 2007 – Mechel OAO (NYSE: MTL), one of the leading Russian mining and metals companies, announces the commissioning of two modern drawing mills to produce 1.4 mm - 2.4 mm diameter spring wire at Workshop No. 12 of its Beloretsk Metallurgical Plant subsidiary.

The commissioning of two modern drawing mills at Beloretsk Metallurgical Plant OAO’s (BMP) Workshop No. 12 to produce 1.4 mm - 2.4 mm diameter spring wire is the most recent stage of the plant’s ongoing strategic technical re-equipment program aimed at improving product quality and reducing production costs. Since the beginning of 2007, the plant has commissioned a complex to produce high-tensile stabilized reinforcing wire; two lines to produce rope wire, clip wire, and semi-finished fiber wire; and rewinders.

The cost of the project amounted to more than RUR 69.0 million (approximately $2.8 million) and the designed capacity of the equipment will be approximately 14.2 thousand tonnes of wire annually.

The two newly commissioned drawing mills, manufactured by Ernst Koch of Germany, a leading manufacturer of wire drawing equipment, consists of an unwinder; a mechanical descaling line; a straight-through type drawing machine; and a coiler to lay wire in rosette type bundles.

Similar equipment already successfully operates at the plant. The first equipment to manufacture spring wire of 1.4 mm - 2.2 mm diameter was commissioned at BMP in 2005. Another two lines similar to the newly commissioned modern units were put into operation at Workshop No. 12 about a year ago. There has been consistently growing demand for spring wire in the market, which is mainly supplied to furniture manufactures. Today, 60 percent of springs in upholstered furniture and mattresses sold on the Russian market are made of the spring wire manufactured by Mechel’s Beloretsk Metallurgical Plant.

 

 

 

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