It is reported that the Russian steel producer Novolipetsk Steel in order to further develop upstream integration in coking coal is planning to start developing its coal deposit Zhernovskoye-1 in the Kemerovo region and aims within three years to meet up to 50% of its coking coal needs.

NLMK is likely to start the development of its Zhernovskoye-1 coal deposit, with total reserves of 240 million tonnes at the end of Q3 2010, with the mine to produce up to three million tonnes of coal in three to four years' time. Meanwhile, considering that the quality of coking coal abundantly mined in Russia is not always satisfactory for modern efficient steel manufacturing, NLMK will start importing coking coal from the US like fellow Russian steelmaker Mechel.

The company statement said "Given the existing deficit in hard coking coal in the Russian market, in Q1 2010 NLMK signed a two year contract for coking coal deliveries from the US in order to improve the quality of coke and increase blast furnace production efficiency. Purchasing costs under the deal, including delivery costs are comparable to the cost of acquiring coal of Russian origin but the quality of imported coal is much better hence allowing higher efficiency of operations."

(Sourced from www.steelorbis.com)
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