PRESS: Russia’s Gazprombank, Mechel to sign Elga deal in April

MOSCOW, Mar 23 (PRIME) -- Russian metals and mining group Mechel and Gazprombank plans to sign final documents for the Elga coal project in early April, business daily Kommersant reported Wednesday citing sources.

Gazprombank will receive a controlling stake in a 321-kilometer Ulak–Elga railway, which cost Mechel 70 billion rubles. The bank will receive 75% in Elga-Doroga company, the railway’s operator created by Mechel in January. Gazprombank may sell the railroad to Russian Railways later, Kommersant reported.

A representative for the Federal Antimonopoly Service told the business daily that Gazprombank has already filed requests for purchases of stakes in Elgaugol, a company that develops the Elga coal deposit, and in Elga-Doroga, but amounts of stakes were not disclosed.

In February, business daily Vedomosti reported that Mechel planned to sell 49% in Elgaugol to Gazprombank for U.S. $500–550 million, after which the producer’s share in Elgaugol would stand at 51%.

Total reserves of the Elga coal deposit stand at 2.1 billion tonnes.

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