16 March 2012

Cherepovets Steel Mill Reduced Steelmaking Energy Consumption by 25% since the Energy Saving Program Started

ОАО Severstal (“Severstal” or the “Company”),  one of the world’s leading vertically integrated steel and steel related mining companies, announces that its Cherepovets Steel Mill, part of the Severstal Russian Steel Division and one of the world's largest standalone integrated steelworks by capacity, reduced specific steelmaking energy consumption to 5.620 Gcal per ton, 25% down from 1999, the launch year of the energy saving program.

In 2011 alone, Cherepovets Steel Mill reduced specific energy consumption* by 1.3%: to produce 1 ton of steel, it reduced the consumption of bought out energy resources: natural gas by 1.4 % (ca. 3 cu m; oxygen by 6.7% (ca. 4 cu m); and electric power by 0.8% (ca. 2 kWhrs).

The considerable reduction in energy consumption has been achieved due to investment and organizational and technological measures aimed at saving fuel (e.g., in the sintering process and lime roasting), oxygen and electric power (steelmaking).

Andrei Lutsenko, Manufacturing Director and Chief Engineer, Division Severstal Russian Steel commented: “Having taken a number of measures for upgrading equipment, implementing new energy saving technologies, discarding inefficient production facilities and using modern automatic systems to control the consumption of energy resources, Cherepovets Steel Mill considerably reduced energy consumption and became a leader in this parameter among Russian steelmakers”.

According to Mr. Lutsenko, annual reduction in energy consumption is the company’s real contribution to the solution of the important macroeconomic task for the efficient use and conservation of energy resources, and also for the minimization of ecological stress.

According to the 2011 fundamental performance rating offered by Interfax-ERA, Severstal was a leader among enterprises of Russian ferrous metallurgy, ranking 16th among the top 100 real-sector companies.

(*) This is a universal company’s energy efficiency index. It is expressed in Gigacalories (109 cal) per ton of steel and calculated as a ratio of the total amount of consumed heat/energy to the total volume of production (steel).