MMK-Atakas JV Decides on the Equipment Supplier

A contract has been signed on the supply of process equipment for the MMK Atakas A.S. Joint Venture.

The contract has been awarded to Danieli, Italy, which will supply equipment for both of the JV's production sites in Iskenderun and Istanbul, such as a 2.4 mtpy electric arc furnace (EAF), twin ladle furnace unit, twin vacuum degasser, a CSP complex comprised of a two-strand near-net-shape slab caster and a hot rolling mill, a continuous pickling line, a two-stand reversing cold rolling mill, two galvanizing lines, and two colour coating lines.

In May of 2007 the Magnitogorsk Iron and Steel Works OJSC and the Atakas Group decided to build a new steel making plant in Turkey, signing an Agreement of Participation of OJSC MMK in the authorized capital of MMK ATAKAS METALURJI SANAYI, TICARET VE LIMAN ISLETMECILIGI A.S. ("MMK ATAKAS"). In June of 2007 OJSC MMK became the owner of 50.0000045% of shares in the JV. The new plant will be located on two sites, with the core production to be installed in Iskenderun, and a second site in Istanbul. The purpose of the project is to create a state-of-the–art plant for production of steel hot and cold rolled and coated products in Turkey. For MMK the implementation of this project is of great interest as Turkey is one of the most promising markets. The average annual growth of Turkey's steel consumption over the last 7 years has stood at 15%, while production has grown only 8% annually, with the faster growth of steel consuming sectors generating a steady demand for steel flat products.

The production capacity of the new JV will include 2.3 mtpy of  hot rolled flats, 750 ktpy of cold rolled flats, 900 ktpy of galvanized coils and 400 ktpy of colour coated products. There are plans to set up two service centres in Inskenderun and Istanbul. To supply the Iskenderun site with raw and input materials and ship commercial products to customers a sea port will be built directly within the plant's territory capable of receiving ships of up to 80,000 tonnage.

The production facilities will be commissioned in stages. The first stage will include the service centres in Iskenderun and Istanbul, followed by the continuous pickling line, the cold rolling mill and the galvanizing and colour coating lines on both sites. The last to go on stream will be the EAF division in conjunction with the CSP complex in Iskenderun. During the staged commissioning of all the facilities they will be supplied with input steel from OJSC MMK or other international suppliers. The implementation of the project is expected to take three years, at a cost of approx. USD 1.7 bln.