Mechel Announces Acquisition of New Coal Processing Equipment at its Yakutugol Subsidiary

Mechel announces that its Yakutugol coal mining subsidiary has acquired new equipment for its Neryungri Coal Processing Plant in line with its capital expenditure program.

The acquisition of the U.S.-manufactured Artrita coal mill will be used for crushing and coal dust preparation in the processing plant’s drying units. The Artrita coal mill will replace the plant’s depreciated equipment and is the third coal mill purchased by Yakutugol. Two new Artrita coal mills were previously installed replacing the obsolete mills in 2007.

The equipment has high performance characteristics and reliability that meet the processing plant specialists' requirements. The new mill will be installed by Yakutugol’s Mechanical and Repair Plant specialists. The equipment is planned for commissioning in mid-June 2008. The project will cost approximately RUR27.00 mln (approximately $1.2 mln).

“This investment supports the objectives being pursued by our coal subsidiary in increasing its coal output. We need to ensure the processing plant’s reliable operation, which depends on the installed equipment’s serviceability and productivity. Replacing and modernizing obsolete machinery will enable the subsidiary to achieve steady and efficient operation and avoid technical outages,” Mechel Management Chief Executive Officer Vladimir Polin commented.