OREANDA-NEWS. In 2012, SCM Group invested UAH 17.98bn (excluding M&A) in organic development of its assets (UAH 15.163bn in 2011). In particular, Metinvest and DTEK's investments in business development and modernisation amounted to UAH 6.12bn and UAH 10.33bn, respectively.

"The efficiency and profitability of our businesses is a basis for investment in their modernisation, environmental protection, health and safety and good living conditions in the regions where we operate. Our primary objective is to set correct priorities in our investment policy to make our businesses ready to withstand competition in global and national markets, first of all by improving the quality of products and cutting costs," noted Oleg Popov, CEO of SCM. "Along with the upgrade of our businesses we will continue to invest in creating good living conditions in the cities and towns of our presence."

Some of Metinvest's key investment projects in 2012:

Metinvest launched a pulverised coal injection unit (PCI) and a new turbo system for Ilyich Plant blast furnaces, and preparation for construction of a PCI unit at Yenakiyevo Steel Plant. This will result in cutting energy consumption and boosting overall energy efficiency of the plants.

Yenakiyevo Steel Plant commissioned a modern blast furnace equipped with the state-of-the-art European technologies, including the latest control systems. These innovations will improve the efficiency of the unit, enhance the environmental performance of the plant and reduce the production costs.

Metinvest and Air Liquide began preparations for construction of air separation facility ASU 1400 for Yenakiyevo Steel Plant. The project is within the framework of a long-term agreement for supply of industrial gases signed by Metinvest and Air Liquide in 2011. The production capacity of ASU 1400 is 1,700 tonnes of oxygen, nitrogen and argon a day.

DTEK continued upgrading the power units at DTEK Vostokenergo thermal power plants. As a result, the company will increase the designed capacity of the units, reduce specific consumption of energy, cut air emissions, and improve equipment reliability. In 2012, DTEK completed reconstruction of eight power units and started repairing another four facilities.

Moreover, DTEK commissioned first wind turbines of Botievo wind farm, the largest wind farm in Ukraine. With commissioning of the wind farm will reduce annual air emissions by 730,000 tonnes of CO2e.

In 2012, the SCM Group invested UAH 1.533bn (excluding M&A) in the development of non-industrial businesses.

Last year we invested almost UAH 7bn in environmental protection, health and safety and development of the regions of our operations, which exceeds the 2011 figure by 30%. Thus, SCM Group's businesses provided over UAH 1.5bn for health and safety and more than UAH 4.4bn for environmental protection and social programmes rolled out in the cities and towns of our presence (vs. UAH 1.4bn and UAH 2.9bn in 2011).

The Group's key projects in health and safety in 2012 included:

Krasnodonugol mining group (Metinvest) introduced the latest developments in health and safety – a computer-aided safety system.

Metinvest's enterprises implemented Welfare at Work programme to overhaul amenities, administrative buildings and offices.

DTEK rolled out Occupational Medicine project to improve health and safety of miners. As part of the project, aid posts were provided with equipment for first aid and injury prevention.

Metinvest continued implementing its Strategy for Health Care Development, which includes three components: Emergency Aid, Healthy Lifestyle Promotion and Occupational Health. The initiative seeks to improve the quality of health care in Metinvest's businesses.

Metinvest and DTEK continued introducing new corporate standards of personal safety equipment and clothing across their businesses. As a result, our employees have more modern and comfortable personal protective equipment: safety shoes, gloves and respiratory and eye protection devices.

Some of the Group's key environmental projects include:

Metinvest's Azovstal shut down three outdated coke oven batteries No. 5, 6 and 7, reducing emissions from its coke shop by 50% yet keeping the same output, a result achieved by streamlining the operations of Metinvest's coke plants.

DTEK replaced and upgraded electric filters at eight power units and started modernising gas purification facilities at four power units. The reconstructed electric filters significantly reduce dust concentration in air emissions. All upgraded gas purification facilities have flue gas analysers to ensure continuous control of emissions.

We embrace a comprehensive approach to social investments in local communities. In 2012, we consolidated all social initiatives and programmes within the SCM Group into a single Social Partnership Programme designed to make the cities and towns of SCM Group's operations comfortable to live in. Last year DTEK developed three-year strategies of cooperation with the regions of its presence (for 2013-2015). In nine towns of its operations Metinvest also signed Programme of Social Partnership 2013. DTEK's strategies and Metinvest's Programme were developed in partnership with all stakeholders: government authorities, business and communities. The programmes are focused on development of social infrastructure, deeper engagement of local communities, development of business environment, projects in education, health care, environmental protection, energy efficiency, culture and sports.

Below are SCM Group's most prominent social projects 2012 targeted to improve the quality of living in the regions of our operations:

Reconstruction of Krivoy Rog districts where our employees live. The project was implemented by Metinvest in cooperation with the city authorities. In particular, last year Metinvest refurbished Pobedy avenue and Komsomola Ukrainy park in Inguletsky residential area.

DTEK participated in establishment of local development agencies in Burshtyn, Dobrotvor and Ladyzhin. The agencies' mission is to help cities and towns create favourable conditions for small and medium-sized businesses, attract outside investments to create new jobs and find external financing.

In 2012, the SCM Group rolled out more than 200 projects of UAH 160 million in total. Focus areas were development of social infrastructure, health care, education, development of business environment, deeper engagement of local communities and energy efficiency.

The total headcount of the SCM Group was 280,000 in 2012.

Last year we paid nearly UAH 29bn in taxes.

Our key future priorities include the reconstruction of sinter plants at Ilyich Plant and Yenakiyevo Steel Plant, investment in energy efficiency through installation of PCI units at Azovstal and Yenakiyevo Steel Plant, gradual phase-out of open-hearth furnaces and upgrade of rolling facilities at Metinvest and reconstruction of DTEK's power units. We strive to make our companies competitive in the global arena both in terms of efficiency and environmental footprint.