7 August 2015

Over 90% of NLMK blast furnace facilities will run PCI

Over 90% of NLMK blast furnace facilities will run PCI
NLMK Group (LSE: NLMK), Russia’s top steel-producing company and one of the most efficient steel companies in the world, has launched a project to build a second Pulverized Coal Injection (PCI) complex at its Lipetsk site. When the project is complete, this advanced resource-saving technology will cover more than 90% of the company’s blast furnace facilities.

NLMK obtained the necessary construction permit in July this year, and is now preparing for construction and assemble works at the complex that will cover the largest and the most productive blast furnaces of the plant; namely blast furnace #6, which has a capacity of 3.1 million tonnes per annum; and blast furnace #7 with a capacity of 4.3 million tonnes per annum.

Project capex will exceed 6.5 billion rubles; with start-up scheduled for the second half of 2017. PAUL WURTH S.A. of Luxembourg is in charge of supplying the technology, engineering works and main process equipment; whilst Lipetsk-based Gipromez is the general planner for the project.

Video presentation about the project in English:

Sergey Filatov, Novolipetsk Managing Director, said: “Our ongoing project to implement PCI technology is an important element in our overall Strategy 2017 program to boost operational efficiency and cut specific costs. The new complex will enable a 20-30% reduction in the consumption of expensive coke; and more than 50% reduction in the consumption of natural gas. Over 90% of the plant’s blast furnace capacities will be equipped with the resource-saving PCI technology by the end of 2017.”

NLMK Group began implementing advanced PCI technology back in 2013. The PCI system at Blast Furnace #5 (3 million tonnes of pig iron per year) went live in August 2013; while the PCI system at Blast Furnace #4 (2 million tonnes of pig iron per year) went live in May 2014.

Resource-saving PCI technology involves co-injecting natural gas and fine coal particles into the blast furnace. Replacing expensive raw materials with a cheaper alternatives, such as switching coking coal for steam coal, reduces the cost of producing pig iron.

About NLMK Group

NLMK Group is the largest steelmaker in Russia and one of the most efficient in the world. NLMK’s metal products are used in various industries, from construction and engineering to the manufacture of power-generating equipment and offshore wind turbines.

NLMK's production assets are located in Russia, Europe, and the United States. The Company’s liquid steel production capacity is over 17 million tonnes per year, of which about 16 million tonnes are produced in Russia.

NLMK has the most competitive cash cost among global manufacturers; and one of the highest profitability levels in the sector. The company generated $4.4 billion in revenue; $1.1 billion in EBITDA; and a net profit of $491 million in H1 2015.

NLMK’s ordinary shares are traded on the Moscow Stock Exchange (MICEX-RTS, ticker symbol: NLMK), and its global depositary shares are traded on the London Stock Exchange (ticker symbol: NLMK:LI).