Mechel Receives First Tranche of Financing of Elga Coal Complex
OREANDA-NEWS. December 02, 2013. Mechel (NYSE: MTL), one of the leading Russian mining and metals companies, announces that Elgaugol project company has received the 150-million-dollar first tranche of the project financing for Elga Coal Complex’s first stage totalling 2.5 billion US dollars from Vnesheconombank.
Currently development of the rich Elga deposit is a key investment project for Mechel. Receiving these funds enables the company to continue working on this project regardless of market volatility and attain planned results as scheduled. “The quality of Elga’s coals and Elga’s geographic location make this project one of the most efficient in the world,” Chairman of Mechel Board of Directors Igor Zyuzin said.
“It is through financing such important projects that the economy of Far East and Eastern Siberia should develop. This project is a key one for the region in the sense of economic effect,” Vnesheconombank’s First Deputy Chairman and member of the Board Andrey Sapelin said.
The deal granting Mechel project financing totaling 2.5 billion US dollars for the development of Elga Coal Complex’s first stage was approved by Vnesheconombank’s Supervisory Board in September 2013. The loan has a tenor of 13.5 years with a grace period until 2017. According to the transaction’s conditions, Vnesheconombank’s funds will be used to complete construction of Elga Coal Complex’s first stage. It includes construction of a railroad and a mining and washing complex with an annual capacity of 11.7 million tonnes of run-of-mine coal by 2017.