Project description
and objectives:
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The proposed project will facilitate Severstal’s energy efficiency investments
program with up to Euro 500 million long term loan. It is estimated that the
investments program would reduce Severstal’s primary energy consumption by 5 -
10% compared to existing operations with environmental benefits through CO2
emissions reduction in the order of 600,000 ton per annum. The loan will
finance a number of important energy efficiency projects, including
rehabilitation and enhancement of the company’s on-site energy generation
capacity, modernisation of its oxygen plants and implementation of modern
energy management systems.
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Transition impact:
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The transition impact potential of the project is derived from fostering
greater energy efficiency of Severstal operations and promoting new
environmental standards for the Russian steel industry. The Bank will provide
both finance and an appropriate structure for the agreed package of energy
efficiency investments designed to increase their priority at the Company and
to accelerate their implementation. It is expected that this project will also
support Company’s technological modernization.
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The client:
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JSC Severstal is one of the Russia’s largest vertically integrated producers
of flat steel products with 2006 raw steel production of 17.6 million tonnes.
Initially constructed in 1955 in Cherepovets, the plant was expanded and
heavily upgraded between 1970 and 1990, and it is currently accounting for
roughly 16% of country steel production and supplying 19% of the domestic
market’s steel needs.
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EBRD finance:
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The EBRD will provide a 12 year unsecured loan for an amount of up to EUR 500
million to JSC Severstal, of which up to Euro 350 million will be syndicated
to commercial bank(s).
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Total project cost:
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Total project will amount to approximately EUR 500 million.
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Environmental impact:
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The project has been screened as B/1, requiring an environmental audit and an
environmental analysis of the proposed investments. Following the completion
of the audit, any resulting recommendations will be included in a time-bound
environmental action plan ("EAP") to be implemented over the next twelve
years. Implementation of the EAP will be covenanted in the Loan Agreement. In
parallel to this update Severstal will disclose locally a summary of the
Project and the associated environmental issues. The Project is expected to
result in significant energy efficiency improvements and approximately 600ktpa
CO2 emission reduction. Severstal has developed an Environmental Management
System obtained ISO14001 certificate in 2001.
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Technical
cooperation:
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None.
For consultant opportunities for projects financed by technical cooperation
funds, visit procurement
of consultants.
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Company contact:
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JSC Severstal, Chief of Energy Department, Mr. Trubchanin V.A.
Russia, Vologda region, Cherepovets, Street Mira 30, Tel: + 8 8202 565169
Website: www.severstal.ru
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EBRD contact:
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Serdar Annamukhamedov, Operation Leader: annamuhs@ebrd.com
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Business opportunities:
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For business opportunities or procurement, contact the client company.
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General enquiries:
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EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168; Fax: +44 20 7338 7380
Email: projectenquiries@ebrd.com
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