September 08, 2008

Mechel Commissioning new self propelled drilling rigs at Urals Nickel Plant

Mechel OAO announced that it has commissioned new self propelled drilling rigs at the open pit mines of its subsidiary, Southern Urals Nickel Plant OAO. Commissioning of the new equipment will enable Mechel to increase nickel ore mining efficiency while reducing production costs.

The new Russian-made self-propelled drilling rig, UKB 5S, was commissioned at the Sakharinsk open pit mine at the Southern Urals Nickel Plant OAO this month. A similar unit was delivered to the Buruktal open pit mine administration last week. The cost of commissioning two UKB-5S drilling rigs was more than RUB 12.0 million. The designed capacity of each unit is approximately 400 running meters per month.

The acquisition of the drilling rigs will allow the plant to carry out independent operational exploration while obtaining data for reliable planning and managing quality of mined silicate-nickel ore. The new equipment will help the miners define more precise boundaries of ore bodies, volumes and quality of mineral reserves.

The commissioning of the new self propelled drilling rigs was implemented in line with Mechel’s mining subsidiaries technical re-equipment program. Mechel OAO intends to invest approximately USD 1.2 billion in its mining segment during 5 years.