30 May 2013 Новолипецкий металлургический комбинат

NLMK optimizes pig iron capacity utilization

NLMK (LSE: NLMK) announces that starting from May 30, 2013 and as part of its programme aimed at increasing the efficiency of production and resource use, it is idling its 1.3 mt/y Blast Furnace #3 (BF-3) at NLMK main production site in Lipetsk. The temporary idling of BF-3 will lead to some reduction in the sales of commercial pig iron, demand for which has recently been falling. At the same time, it will have no impact on the overall crude steel and rolled product output planned for the second half of 2013. NLMK Group confirms its previously announced steel production outlook for 2013 at approximately 15.5 mt/y (+3% year-on-year). BF-3 will undergo scheduled maintenance and repairs. Its idling will allow increasing the loading efficiency for NLMK’s remaining blast furnace operations at its Lipetsk plant. The decision to re-launch the furnace will be made as market conditions improve. For reference: Novolipetsk annually sells approximately 0.8-1.0 mt of commercial pig iron. Pig iron is a product of primary steelmaking mostly used as raw material for the subsequent production of steel, and cast iron products applied in machine building and other areas. Novolipetsk currently operates four blast furnaces: BF-4 (1.8 mt), BF-5 (2.7 mt), BF-6 (2.9 mt), and BF-7 (3.4 mt). BF-2 (0.7 mt) was idled in July 2012. Blast Furnace #3 was built in 1962; it was last overhauled in 2000.