Belon: First Semester Results

According to the results of the fist semester of 2007, Belon Group improved its key performance indicators. The total coal production at the mines increased by 46% (or by 788,000 tn) compared to the corresponding period of the preceding year, and amounted to 2,483,000 tn.

In January–June 2007, production of steam coal (including preproduction mining at the Novobachatsky open-pit mine) increased by 47% to amount to 1,309,000 tn. Such growth was due to launching of face No. 1108 at the Listvyazhnaya mine, which is now the most high-capacity face in the Company’s history, fitted with modern high-performance equipment. The face reserves amount to 1,600,000 tn. The total production of the Listvyazhnaya mine in the first six months of 2007 amounted to 1,272,000 tn, which is 51% more than the respective index of the last year. The Novobachatsky open-pit mine produced 37,000 tn of steam coal.

Together with stimulating production growth at the Listvyazhnaya mine, Belon Group increased the sales volume of steam coal up to 1,128,000 tn. The share of exported coal in the total sales of coal amounted to 674,000 tn, which is twice as much as that of the last year.

In the first semester of 2007, production of metallurgical coal at the enterprises of Belon Group totaled 1,000,060 tn, thus exceeding the respective index of the preceding year by 41%. Since the beginning of the year, the Chertinskaya-Koksovaya mine has produced 679,000 tn of coal (33% growth from the same index of 2006), and the Novaya-2 mine—168,000 tn. The Novobachatsky open-pit mine has produced 213,000 tn of metallurgical-rank coals, which is 3.4 times more than that of the first half of 2006.
In total, by the end of 2007, the mines of Belon Group are expected to produce 4.7 mln. tn of steam and metallurgical coal, and the total production of the Group, including coal sludge, will amount to 5.1 mln. tn.

The volume of coal preparation at the Belovskaya central coal preparation plant (CCPP) in the reported period amounted to 2,211,000 tn of bank coal and sludges, with the share of the Group’s own coals delivered for preparation increased by 38%—up to 989,000 tn. The Company produced 1,510,000 tn of metallurgical coal concentrate. Based on the results of  2007, the Group plans to prepare 4,660,000 tn of raw materials, whereas the coal concentrate production is expected to amount to 3,309,000 tn.
In the second semester, the Group will start production of steam coal concentrate involving the newly commissioned enterprise of Belon Group—the Listvyazhnaya coal preparation plant. By the end of the year, the Group plans to produce up to 900,000 tn of the finished products—high-calorific steam coal with low ash content.

The considerable production growth became possible due to successful implementation of the major investment program of Belon Group, which was aimed at production development, and at increasing of the Company’s coal production and preparation capacities. As a result, the total investments of the first semester of 2007 amounted to 2,680 mln. rubles.