Evraz sees annual capex on coal assets at $100 mln until 2025

MEZHDURECHENSK, Kemerovo Region, Sep 21 (PRIME) -- U.K.-based mining giant Evraz, which operates mainly in Russia, plans annual capital expenditures on coal assets at around U.S. $100 million until 2025, Sergei Stepanov, senior vice president and head of the coal division, told PRIME on Thursday.

“Historically, the division spends around $100 million per year on capex on maintenance, without construction of new mines. One project of maintenance – a switch to a new layer – costs from $60 million to $80 million approximately, because it is necessary to change a significant part of infrastructure. Including all projects, $100 million is an average estimate. Without construction of new mines, without purchases. In “bad” years it could be $80 million, in “good” - $120 million,” he said.

Stepanov also said that Evraz keeps interest in managing Sibuglemet group.

“The role of Evraz is limited to the role of operational manager. We have an agreement on management officially approved by the owners of the asset. Correspondingly, we put a team of managers there and we carry out management. We are fully content with our relations in terms of management, and if they (Sibuglemet shareholders) decide to hold an auction, we will certainly participate,” he said.

Kommersant business daily reported earlier that Sibuglemet is starting reorganization of its shareholder and debt structure, and an auction for the company’s management will take place in October–November. In the future, the company could be put up for sale, the daily also said.

Evraz has started test supplies of coal to a number of countries of Central Europe, Stepanov also said.

“Logistics costs around $60 in the area of Slovakia, and it was almost useless to ship there. In fact you pay for the supply, and with a low price nothing will return. With the price of 2017 it is possible, and we try… In 2017, we sent several batches to Hungary, Slovakia, Poland,” he said.

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