OREANDA-NEWS. June 5, 2007. Mechel OAO (NYSE: MTL) today announced that a modern equipment complex has been commissioned at its subsidiary, Beloretsk Metallurgical Plant OAO (BMP), to produce high-tensile stabilized reinforcing wire, which meets the world standards of quality.

The project was implemented in line with Mechel’s investment program for technical development of BMP’s production aimed at improving product quality, increasing output, reducing production costs, and increasing profitability. The cost of the new project is estimated to be about $4.6 million (RUR 120.0 million). The official ceremony of opening the new complex was attended by the President of the Republic of Bashkortostan Murtaza Rakhimov, Mechel Chief Executive Officer Igor Zyuzin, and Mechel Management OOO General Director Vladimir Polin.

The new equipment will allow BMP to manufacture a brand new product, low relaxation stabilized reinforcing wire of 4.0 to 8.0 mm diameter, with the annual output of about 20,000 tonnes. The wire meets the world standards of quality. Mechel plans to ship the new product to Russian consumers, with the view to replace imported analogs, as well as international markets.

The product is supplied to construction companies for manufacturing of prestressed concrete structures, used in the most important construction elements such as reinforced-concrete ties, reinforced-concrete pressure pipes, towers, and bridging panels for high-rise buildings. The new equipment was manufactured by Ernst Koch of Germany and GCR of Italy.

“The management of Mechel and BMP made the decision to acquire the new equipment based on the significant market demand for high-tensile stabilized reinforcing wire. Its commissioning will enable BMP to expand its product line and increase its output and sales,” Beloretsk Metallurgical Plant Managing Director and Mechel Hardware OOO General Director Konstantin Nikolin commented.