MOSCOW, Jan. 14, 2015 (GLOBE NEWSWIRE) -- Mechel OAO (NYSE:MTL), one of the leading Russian mining and metals companies, announces signing a memorandum of understanding with China's steelmaking major Baosteel Resources corporation, which provides for an increase of coal supplies to 1.4 million tonnes of coking coal a year.
According to the memorandum, Mechel will supply Baosteel Resources with up to 1.4 million tonnes of coking coal. The agreement will be valid from April 2015 through March 2016, with a possibility of further prolongation. Prices will be determined on a monthly basis.
The memorandum also provides for a possibility of supplying Baosteel with other Mechel products, such as PCI and steam coal, as well as cooperation in other areas, including the possibility of collaboration with the economic development institutes in Russia and China.
Mechel is fully meeting its obligations according to the earlier contract, which provides for supplies of 1.2 million tonnes of coking coal a year. Since April 2014 through December, over 1 million tonnes of coking coal was shipped to Baosteel enterprises in China's eastern and southern provinces, which accounts for 10% of Mechel's coal exports to Asia Pacific.
"Long-term export contracts are particularly important for us in the period of FX volatility as they provide Mechel with stable foreign currency revenue. We are currently exporting over 70% of our mining division's products," Mechel OAO's Chief Executive Officer Oleg Korzhov commented.
Mechel is an international mining and steel company which employs over 70,000 people. Its products are marketed in Europe, Asia, North and South America, Africa. Mechel unites producers of coal, iron ore concentrate, steel, rolled products, ferroalloys, heat and electric power. All of its enterprises work in a single production chain, from raw materials to high value-added products.
Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of Mechel, as defined in the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. We wish to caution you that these statements are only predictions and that actual events or results may differ materially. We do not intend to update these statements. We refer you to the documents Mechel files from time to time with the U.S. Securities and Exchange Commission, including our Form 20-F. These documents contain and identify important factors, including those contained in the section captioned "Risk Factors" and "Cautionary Note Regarding Forward-Looking Statements" in our Form 20-F, that could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, the achievement of anticipated levels of profitability, growth, cost and synergy of our recent acquisitions, the impact of competitive pricing, the ability to obtain necessary regulatory approvals and licenses, the impact of developments in the Russian economic, political and legal environment, volatility in stock markets or in the price of our shares or ADRs, financial risk management and the impact of general business and global economic conditions.
CONTACT: Mechel OAO Ekaterina Videman Tel: + 7 495 221 88 88 email@example.com