Mechel announces Elga first results

Mechel, one of the leading Russian mining and metals companies, announces the first results of mining in Yakutugol Holding Company OAO’s Elga Coal Complex.

In accordance with plans announced earlier, mining at the Elga deposit started in August. The Elginsky open pit yielded some 21,000 tonnes of coal in less than a month.

The start of the mining process was timed to the commissioning of the Ulak-Elga railway from point 1 to the 209-kilometer point, with the railway planned to be fully completed in December 2011. Until then, coal is due to be transported by heavy-duty trucks from the open pit to the 209-kilometer point, which is equipped with a transshipment station to transport coal further by rail.

One work shift in Elga Coal Complex currently includes some 120 personnel. Over 75 equipment units are involved in the mining process. In addition to mining, leveling operation of the chief mine site is being held at the open pit.

Igor Zyuzin, Chairman of Mechel OAO’s Board of Directors and Mechel Mining OAO’s Chief Executive Officer, commented on the company’s work on the deposit: “We are glad to report the commissioning of the Ulak-Elga railway up to the 209 kilometer point and the successful start of the mining process at the Elga open pit in accordance with earlier plans, as well as announce the first results of the complex’s work. Developing the deposit is a major strategic project not only for our company, but for the whole Far East. By implementing the Elga project, Mechel is introducing a project unique for Russian business — a private railway and an open pit with one of the world’s largest coking coal production volumes. Commissioning of the Elga open pit and the railway linking it to the Baikal-Amur Mainline will prove that Mechel OAO is one of the few companies in the world that can implement large-scale coking coal mining projects from scratch. Mining this deposit will enable us to complement our coking coal product range and reinforce our international positions among leading producers of metallurgical coals.”