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PAO Severstal, one of the world’s leading vertically integrated steel and steel-related mining companies, has acquired from Gazprombank rights for loans and accrued interest of Metal-group LLC worth over 12 billion rubles as well as collateral for the loans. Metal-group LLC is the owner of the mining license for the central part of Yakovlevsky iron-ore deposit. Severstal paid 6 billion roubles as part of the transaction.
Alexander Shevelev, CEO of Severstal, said: “The Yakovlevsky mine is a unique asset with rich resources. The mine is well-known to Severstal, which has historically been one of the mine’s major customers. Severstal is committed to being vertically integrated as this offers a key strategic advantage, and further consolidation of the Yakovlevsky mine, which produces high-grade iron ore, could support the Company’s continued self-sufficiency long-term. We are confident that our extensive experience of successfully transforming Severstal’s existing iron ore assets will support our plans to improve efficiency at Yakovlevsky to industry-leading levels. The asset’s debt position is currently preventing it from developing efficiently. As a long-term, strategic investor we will ensure that the mine fulfills its potential and give its employees restored confidence in the future”.Yakovlevsky mine is located in Yakovlevo, 40 km north from Belgorod in the Kursk Magnetic Anomaly basin. The total resource base of the Yakovlevsky deposit exceeds 9.6 billion tonnes. The operational scheme includes underground mining and surface crushing without beneficiation (DSO). The ore has an iron content of 61.4%. The mine’s current production capacity is one million tonnes and a project to increase capacity to 4.5 million tonnes has recently been launched at the asset.