METALS AND MINING

Metalloinvest, a major global producer and supplier of iron ore and steel products, and Baikal Mining Company, which holds the largest copper reserves in Russia, are at the core of USM's investments in the metals and mining sector.
METALLOINVEST
  • Metalloinvest is at the forefront of the global metals and mining industry and holds the second-largest iron ore reserve base in the world, amounting to c.14.1 billion tonnes. It is the merchant hot briquetted iron (HBI) market leader and the second-biggest manufacturer of pellets globally. Metalloinvest is the largest mining company in Russia and the CIS and one of the top regional high-quality steel manufacturers. Its main production assets are located in the European part of Russia.
  • Metalloinvest operates two integrated divisions. The mining segment comprises Lebedinsky GOK and Mikhailovsky GOK, and the steel segment incorporates OEMK, Ural Steel and Ural Scrap Company.
  • Lebedinsky GOK is the number one plant for mining and beneficiation of iron ore in Russia. It is the country's only hot briquetted iron manufacturer. After the launch of its third HBI production facility (HBI-3 Plant) with a design capacity of 1.8 million tonnes of hot briquetted iron per year, Metalloinvest can now produce up to 4.5 million tonnes of HBI annually. The plant reinforces Metalloinvest's leading position on the global merchant hot briquetted iron market, of which the company currently has a share of с.50%.
  • Mikhailovsky GOK is the second-largest iron ore extraction, processing and pellet production facility in Russia, next best to Lebedinsky GOK. The latest pellet plant at Mikhailovsky GOK enabled Metalloinvest to increase pellet output capacity by 5 million tonnes per year.
  • OEMK is one of the most modern fully-integrated steel mills in Russia. It employs advanced technology for the direct reduction of iron and electric arc furnace smelting. The unique properties of OEMK's high quality steel have ensured stable demand in the local market and worldwide.
  • Ural Steel is a fully-integrated iron and steel works, including blast furnace, steelmaking and rolling manufacture. The majority of its output consists of merchant pig iron, pipe billets and strips, as well as bridge construction steel and heavy plates. The plant is a leader in its niche product markets.
  • Ural Scrap Company purchases, processes and delivers ferrous scrap to Metalloinvest's steel segment enterprises.
BAIKAL MINING COMPANY
  • Baikal Mining Company holds the largest copper reserves in Russia. It was established in 2008 to develop the Udokan copper deposit, one of the world's biggest undeveloped sites, with resources of 26.7 million tonnes. The company's operations are located in the Kalar District of Russia's Zabaikalye region.
  • Having received the approval of the Special Committee for Solid Mineral Deposits Development of Rosnedra for the Udokan technical project, the company plans to start construction of mining infrastructure facilities at Udokan by the end of 2018 and commission Phase I of the plant with 12 million tonnes per year capacity in 2022. The expected mine life is 50-60 years.
  • The project is connected to major ports and transport hubs in Russia's Far East by the Baikal-Amur Railway, benefitting from geographic proximity to key copper consumers in China, Japan and South Korea.
  • Baikal Mining Company's copper deposit development is viewed as a project of strategic importance. It is part of the Russian Metallurgical Industry Development Strategy until 2020 and the Social and Economic Development Strategy for the Far East and Baikal Region until 2025. The project envisages the creation of 4,000 jobs at the company itself, as well as up to 20,000 positions in related sectors.