In 2017, Metalloinvest allocated USD 488.6 million for capital
expenditure, up 68.6% year-on-year. This increase was due to a
number of development projects implemented in the reporting
In July 2017, Metalloinvest launched its HBI-3 Plant at
Lebedinsky GOK, Russia’s largest HBI production facility and
one of the world’s most powerful plants, with an annual design
capacity of 1.8 million tonnes of HBI. The Company invested
approximately 24% of its 2017 capital expenditure in this project.
At Mikhailovsky GOK, Metalloinvest completed the construction
of an intake facility for the concentrate supplied by Lebedinsky
GOK. The facility takes in and unloads Lebedinsky GOK’s iron
ore concentrate, and mixes concentrate from Mikhailovsky GOK
and Lebedinsky GOK to subsequently produce high quality
In 2017, Metalloinvest began the implementation of
comprehensive development programmes at Lebedinsky
GOK and Mikhailovsky GOK, aiming to increase the output
of high value-added products, improve the product quality
to the premium level, and lower operating expenses. The
implementation of key engineering solutions is scheduled for
Lebedinsky GOK and Mikhailovsky GOK received eleven new
220-tonne and 130-tonne BelAZ trucks, four locomotives with
a set of dump cars, two drilling machines and two excavators.
The Company invested about 9% of its capital expenditure in
upgrading its mining and transport operations.
OEMK successfully completed the technical re-equipment at
DRI Plant #2, including the installation of modern equipment,
which boosted the plant’s productivity from 88 to 110
tonnes per hour and helped decrease the scrap expenses.
Approximately 10% of the total capital expenditure for 2017 was
allocated to this project.
During the reporting period, OEMK completed key stages
of construction and started commercial operations of the
reduction and calibration section at the mid-size production
line of Rolling Mill 350. This project enables the Company to
increase its special bar quality (SBQ) output by 67,000 tonnes
per year and reduce its production costs.
At Ural Steel, Continuous Casting Machine #1 and the vacuum
degasser were commissioned after an upgrade. The project
is aimed at strengthening the Company’s customer focus and
changing its product mix towards higher-margin products (rail
blooms and railway wheel billets). The equipment delivery was
completed as part of the construction of the Roller Treatment
Furnace #1 and Heat Treatment Machine #1 Complex, and
installation works are underway. This project aims to increase
the quality of heavy plates produced at Ural Steel.
The Company has continued the roll-out of its Industry 4.0
programme to create an integrated financial and business
management system. The programme is aimed at reducing
costs, boosting profitability, increasing accounting transparency,
and ensuring timely decision making.