OREANDA-NEWS. December 17, 2007.  ESTAR plans to invest 36 mln euro in the upgrade of CJSC Volga-FEST /Frolov Electric Steel Melting Plant, Frolovo, Volgograd region/, the plant’s capacity will increase 2.2 times up to 480,000 t of steel per year on the basis of the 2007 plan, according to the ESTAR Group press release.

In 2007 the Frolov Electric Steel Melting Plant plans to increase the production of CC steel square blanks by 12% up to 220,000 t  (the number of daily melts has reached 16). In 2006 the blanks production was 196,800 t.

Vadim Varshavsky, the main shareholder, and Andey Mishin, president of ESTAR Group, visited Volga-FEST in November. During a meeting with the General Director of the enterprise, Leonid Ivantsov, it was decided to upgrade the plant in two stages. The objective is to increase steel melting production up to 480,000 t per year /28 daily melts/ and decrease the prime costs of the existing capacities reconstruction.

The first stage of upgrade is to increase the capacity of operating arc furnace up to 320,000 t per year /19 daily melts/. The estimated investment volume in the present stage of arc furnace and drop-hammer shops reconstruction is over 25 mln euros. It is planned to finish the first stage of technical re-equipment in the 3rd quarter of 2009.

The second stage of reconstruction is planned for 1.5 year and envisages the installation of a new blanks CC machine /BCCM/ with a commodity output of 480,000 units per year. The investments in the second stage of upgrade are about 11 mln euro. The implementation period of the whole technical re-equipment program for CJSC Volga-FEST will last till 2011; commissioning and development of new equipment is planned for 2010.

ESTAR managing company has also decided to start the construction of a second arc furnace shop and a section rolling mill for fittings production near the existing facilities; the capacity of the new arc furnace shop will be up to 500,000 t per year. The site for the Arc Furnace Melting Shop-2 (AFMS-2) construction has been previously agreed with the municipal authorities of Frolovo.