Russian mining and steel group Mechel has announced the closure of the deal on the sale of a 49 percent share in the Elga coking coal deposit development project to Russian bank Gazprombank, with a value of RUB 34.3 billion ($532.15 million).
According to the agreement, Mechel has sold a 49 percent stake in Elgaugol, the operator company of the project and owner of its subsoil license, a 49 percent stake in Elga-Doroga, which owns the Ulak-Elga railroad, and a 49 percent stake in Mecheltrans-East, which is the railroad’s transport operator, to Gazprombank.
“Together with Gazprombank we have followed the long and difficult path of restructuring Mechel’s debt, and, now, building on our partnership, we have exercised Gazprombank’s option to purchase a 49 percent share in Elga Coal Complex. Completion of this deal will not only help decrease Mechel’s debt, but will also enable us to further develop the Elga deposit, which has tremendous importance for Russia’s mining industry,” stated Mechel CEO Oleg Korzhov.