What’s Going on with Mechel PAO?
The Russian metallurgical and mining company Mechel PAO (MTL) announced today, Sept. 22, that the firm has signed a contract to supply the Far-Eastern Energy Company’s Neryungrinskaya Power Station with coal. Before market open today, MTL stock increased 3.98% in value, up to $3.66 a share.
What Does This Mean for MTL?
Mechel’s new coal-supplying contract with the Far-Eastern Energy Company, which is part of the RusHydro Group, will see Mechel supply approximately 360,000 tons of thermal coal to the Neryungrinskaya Power Station. The supply contract is from October 2021 to March 2022.
“We have been working together with Far Eastern energy providers for decades, and this new contract only strengthens this longstanding partnership,” Mechel PAO CEO Oleg Korzhov explained in a press release. “Approximately 10-12% of thermal coal sold by Mechel’s mining division goes to Far Eastern Energy Company. The company confirmed their interest in our coal, and we in our turn are ready to provide them with coal of requisite quality.”
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Mechel PAO is a vertically integrated group operating into three industrial segments Mining, Steel and Power. The mining segment produces metallurgical coal (coking coal, PCI and anthracite), steam coal, iron ore and iron ore concentrate, coke and chemical products. The segment consists of its coal, iron ore and coke production facilities in Russia. The steel segment produces and sells semi-finished steel products, long products of a wide range of steel grades, carbon and stainless flat steel products and high value-added metal products, including wire products, stampings and forgings, structural shapes, beams and rails. The power segment sells electricity and capacity to the wholesale market. The majority of the revenue is derived from the Steel segment.