Raspadskaya Coal Company (Raspadskaya), one of Russia's leading coking coal producers, has announced that its subsidiary Raspadskaya-Koksovaya has acquired 100 percent of voting shares in coal company Koksovaya from Evraz Group's Yuzhkuzbassugol. The value of the transaction has not been disclosed.
Koksovaya's total reserves amount to 152 million mt of hard coking coal of K and KO grades, and is developing the same coal seams as Raspadskaya-Koksovaya, as long as both mines are located on neighboring subsoil areas, i.e. Coal Deposit No. 1 and Coal Deposit No. 2 of the Olzherasskoe coalfield in Russia's Kemerovo region.
Currently, Raspadskaya-Koksovaya is in the process of constructing a mine for the development of the field in question. Total hard coking coal reserves of both mines are estimated at 328 million mt.
The sale of Koksovaya to Raspadskaya-Koksovaya is in the interests of both companies, since both subsoil areas of the integrated coal deposit will be developed according to a single and optimal mining plan, involving the consecutive mining of upper seams ready for extraction by using the infrastructure of Raspadskaya-Koksovaya.
"Coal assets integration will provide not only maximum effective coal reserve extraction and minimization of costs but will also enable acceleration of the achievement of the nameplate production capacity of the Raspadskaya-Koksovaya mine," reads the Raspadskaya statement.
In addition, as part of the transaction a 10-year contract will be concluded in May for the supply of a part of coal production from total coal volumes mined by Koksovaya and Raspadskaya-Koksovaya to Evraz Group subsidiaries, particularly to two steel mills in Russia's Siberia region, to one steel mill in Russia's Urals, and to three coke-chemical plants in Ukraine. The deliveries will be carried out at market price by using existing commercial practice.
Evraz Group holds a 40 percent effective interest in Raspadskaya.