Mechel, one of the leading Russian mining and steel groups, has received the Russian government's approval for the postponement of the commissioning date of the Ulak-Elga railroad to its Elga coking coal deposit until December 2011, due to delays in funding in the period from September 2008 to August 2009, caused by the financial crisis. Initially, the railroad was to be put into operation no later than September 30, 2010.
The construction of the Ulak-Elga railroad, which is about 315 km in length, was started in February 2008. The cost of the project amounts to about $1.3 billion.
As SteelOrbis previously reported, the first coal at Elga coking coal deposit is planned to be mined as early as November this year. In 2010, Mechel plans to mine up to 200,000 mt of coal, while in 2011 it expects to increase its output to one million mt, considering the growing demand for high quality coking coal both within and outside Russia. By 2013, Mechel could reach a production level of about nine million mt, while the main goal of the company is still to reach 27-30 million mt of coal production at the deposit. The license for the development of the Elga deposit, with total reserves of fat coking coal amounting to approximately 2.2 billion mt, was won by Mechel in 2007.