Pervouralsky Novotrubny Works (PNTZ), a subsidiary of one of the largest Russian pipe producers, ChTPZ Group, has announced that it has secured five-year credit lines in the amount of Ruble 10 billion (about $340.3 million) from Russia's largest state-owned bank Sberbank.
Accordingly, the main part of the credit, i.e., Ruble 8 billion (about $272.3 million), will be used to complete the construction of PNTZ's new electro-smelting facility, while the remaining Ruble 2 billion (approx. $68 million) will be used to refinance debts to foreign banks.
The cost of the construction of the new electro-smelting facility, which started in 2007, is estimated at Ruble 19.2 billion (approx. $653.4 million). The new facility, with a production capacity of 950,000 mt per year, will allow ChTPZ Group to achieve vertical integration in the seamless pipe segment, making it almost self-sufficient in high-quality billets for seamless pipe production. The contracts for the supply of the main equipment, including an electric arc furnace and two continuous billet casters, were concluded with German plantmaker SMS Demag.
In October 2009, another Russian bank Gazprombank opened a credit line for ChTPZ Group worth Ruble 20 billion (about $680.7 million), of which Ruble 5 billion (approx. $170 million) will be used to complete a strategic project in 2010 for another ChTPZ Group subsidiary, i.e., to complete the construction of a new shop for the production of single-seam large diameter (LD) pipes at Chelyabinsk Tube Rolling Plant (ChTPZ).
"The agreements with Sberbank and Gazprombank have allowed ChTPZ Group's subsidiaries to create comfortable conditions for the completion of their investment projects during one year," reads the company's statement.
$1= Ruble 29.3829