New Tyumen UGMK Plant Construction Needs Government Help

20.04.2009 — News

THE TYUMEN OBLAST.

The Ural Mining and Metallurgical Company will turn to the Russian Government for financial support. UMMC will be unable to complete the construction of the electrometallurgical plant in Tyumen without help of the RF Investment Fund.

The plant's designed annual capacity is 550 thousand tons of rolled section. It is being constructed on conditions of private-public partnership between the Ural Mining and Metallurgical Company and the Tyumen Oblast Government. 40% of metal structures have been erected to date. The metallurgists count on 6 billion roubles from the Investment Fund, UMMC will allocate the further 9 billion roubles.

UMMC informed RusBuinessNews that the delivery of the key technological equipment from Italian companies DANIELI and SIAD should be completed by the end of April 2009. By September the construction site should receive the furnace for kilning lime and dolomite from Italy.

It should take about three months to draft the documentation for the RF Government. If UMMC does not get the additional funding, the company will have to suspend the project. Originally, the Austrian company Strabag SE was in charge of the construction, but the general contract with this company was terminated in December 2008 due to excessive costs: the assembly work was carried out predominantly by Austrian and German specialists.

In January - April 2009 UMMC and Strabag were managing a coordinated transfer of the interim construction work results, the delivery of the ordered metal structures and the contract payment settlements. Strabag SE is under the obligation to transfer the subcontracts for the completion of unfinished construction and assembly works to new subcontractors.