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28 October 2014

NLMK Group upgrades hot-rolling mill at Lipetsk production site

NLMK Group, Russia’s leading manufacturer of steel and high value added rolled products, has completed an upgrade of its continuous wide-strip hot-rolling Mill 2000 with a capacity of 5.7 million tonnes of rolled steel per year.

The project included an upgrade of the roll-out table, the equipment used to transport hot-rolled steel from rolling mill stands to the coilers. Investment into the project totaled approximately RUB 800 million.

New technical solutions helped create an integrated speed rate control system, increasing the mill’s productivity by almost 45,000 tonnes per year; as well as significantly improving the surface quality and mechanical properties of rolled steel. The use of new materials provided a four-fold increase of the operational reliability of the main elements of the new roll-out table, as well as a 50% reduction of its maintenance costs.

Konstantin Lagutin, NLMK Group Vice President for Investment Projects, said:
“The project completed at the hot-rolling mill is part of our Strategy 2017 initiative devoted to increasing operational efficiency. The financial benefits of the project are the result of increasing product quality; enhancing productivity and reducing maintenance costs.”

For reference

Hot-rolled steel at NLMK’s Lipetsk site, from standard grades to electrical steel, is produced at Mill 2000. After rolling, steel thickness varies between 1.5 mm and 16 mm, with widths of up to 1850 mm.

Hot-rolled steel is used mainly in the production of steel structures, safety fences, ship hulls, machine shells, parts for road machinery, pressurized vessels and building constructions. NLMK’s share in the Russian hot-rolled steel market is approximately 13%.

The bulk of hot-rolled steel produced in Lipetsk is sent for further processing at cold-rolling shops. Up to 228,000 tonnes of hot-rolled steel is delivered annually from the Lipetsk site to NLMK Group’s asset in Yekaterinburg, VIZ Steel, as substrate for the production of transformer steel.

About Novolipetsk (NLMK’s main production site in Lipetsk)

Novolipetsk is the main production site of NLMK Group, Russia’s leading manufacturer of steel and high value added rolled products, and one of the most efficient steelmaking companies in the world. Novolipetsk is the nucleus of NLMK Group’s single production chain, with assets in Russia, the EU and the USA.

Currently, the steel production volume of the Lipetsk site is in excess of 12 million tonnes per year, or approximately 18% of all steel produced in Russia, and approximately 80% of all steel products produced by NLMK Group.

Novolipetsk’s high-quality steel products are used in various strategically important industries, from construction and machine-building to the production of energy equipment and large-diameter pipes.

About NLMK Group

NLMK Group is one of the leading steelmakers in the world, and the largest steel producer in Russia.

NLMK’s production facilities are located in Russia, Europe and the USA. The Company’s crude steel capacity is over 17 million tonnes per year, of which approximately 16 million tonnes are located in Russia. NLMK has modern production capacities that are on par with leading international manufacturers in terms of technology.

The Group’s vertical integration allows for control of the entire production chain, from mining to final processing and delivery to our customers.

The Group produces a wide range of flat and long steel products. NLMK is the world-leading supplier of slabs and transformer steel, and the largest Russian supplier of HVA products, including pre-painted steel, galvanized steel and electrical steel, as well as long products.

The Company has a diversified sales topography, delivering products to over 70 countries around the world.

NLMK has the most competitive cash cost among global manufacturers; and one of the highest profitability levels in the sector. The Company generated $10.9 billion in revenue and $1.5 billion in EBITDA in 2013.

NLMK is the only steelmaker in Russia with an investment grade credit rating from international rating agencies. It is included in the TOP10 for corporate governance and transparency among Russian public companies by international rating companies.

NLMK’s ordinary shares are traded on the Moscow Stock Exchange (ticker “NLMK”) and its global depositary shares on the London Stock Exchange (ticker “NLMK:LI”).