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#2' 2005 print version

The previous year in the iron-and-steel making operations of EvrazHolding was marked by the start-up of the whole number of new and reconstructed facilities. Large investments and big expectations were associated with the above. The managing directors describe to what extent they have proven true.

Andrei Karunos

n a conversation with Eurasian Metals Andrei Mokrinsky, the managing director of the West Siberian Steel Corporation (ZSMK or ZapSib), has revealed that his enterprise is moving to a new production level and that it will become a supplier of quality steels. He considers it the key result of modernization works being underway now at ZSMK.

In 2004 several new production facilities have been constructed at ZSMK. Among the most important ones Andrei Mokrinsky mentions the two-position furnace-to ladle installation. It has been constructed just in ten months and, in the words of the managing director, precisely this installation makes it possible to offer the market products with a higher added value and reduce costs. As Andrei Mokrinsky stresses, specialists at ZSMK ¡°know well the value of each degree when metal is being heated¡±. The new furnace-to-ladle installation is aggregated with a section continuous casting machine. It means that a temperature in the converter during the steel-making process can be lowered at once by 70 to 80¨¬¬³. ¡°Besides, when making quality steels under the converter-furnace-to-ladle-continuous casting machine scheme, we reduce technological losses of metal by as much as ten times as compared with the classical scheme¡±, says Mokrinsky.
In 2005 the main goals of investments at the integrated plant will be:
- commissioning a slab continuous casting machine with the production volume of 2.5 million tons year-on-year;
- continuing reconstruction works on the by-product-coke production facility along with putting in operation coke-oven battery No. 1 with the production volume of 750, 000 tons year-on-year,
- mastering the new technology of forming transportation packages at the rolling-production facilities.
It is planned to allocate over $178 million so as to implement the whole program of reconstruction. As before, transferring the steel-making process to continuous casting still remains the priority. Within this project over $71 million will be invested in constructing a continuous casting machine complex.
In 2004 the production volumes at ZapSib were lowered somewhat. Against the background of the positive dynamics in the previous years it seemed somewhat strange. The managing director explains this phenomenon by deliberate actions: overhauling simultaneously two blast-furnaces that resulted in reducing production of cast iron by 6.9 % and affected the whole production cycle. However, the strategy remains the same. Andrei Mokrinsky considers an increase in steel making the enterprise¡¯s most important task.
In response to the question about the urgency of the raw material problem Mokrinsky reminds that his enterprise is a structural unit of EvrazHolding, which is strenuously consolidating its own raw material base. The principal supplier of iron ore to ZapSib is Evrazruda, the holding¡¯s ore-mining company. The proved reserves of iron ore, which it possesses, are valued today at 260 million tons. In 2004 Evrazruda mined 14.1 million tons and produced 7.7 million tons of primary concentrate. EvrazHolding is planning to acquire new raw material assets and keep on investing in Evrazruda so as to provide for the needs of its iron and steel integrated plants by 100%.
The main supplier of coal to ZSMK is the company Yuzhkuzbassugol: its share amounts to about 80% of ordinary coking coal and to 100% of coal concentrate.
The managing director believes that as far as energy supplies to ZSMK are concerned, the key task is to reduce energy consumption. He draws attention to the gradual reduction in purchasing energy resources. Between 2001 and 2004 purchases of gas at ZapSib went down from 631 to 574 million cubic meters and purchases of electric power were reduced from 2,937 to 2,919 million kwh, while the steel-making volumes remained about the same.
Under the holding¡¯s IT-programs ZapSib keeps developing the information infrastructure. At present, there is a local exchange of information ensured throughout the whole territory of the integrated plant. There is also an access of users to centralized information and telecommunication resources of the plant¡¯s unified information network as well as to remote information resources.
¡°The range of ongoing works is illustrated by the following indicators: 160 km of fiber-optic lines of communication have been laid, 230 units of active network equipment have been installed¡±, says Andrei Mokrinsky. ¡°Six thousand computer users have been united in a single network. All this has made it possible to create conditions at the integrated plant, which are necessary for introducing the SAP R/3 system¡±. ¡°The further development of the integrated plant¡¯s information infrastructure is linked to accomplishing such major tasks as: improving the monitoring system as well as the system of managing the unified corporate network of EvrazHolding¡¯s enterprises, improving quality of support information services, developing the information security system, creating a multi-service unified network of the holding¡¯s enterprises that makes it possible to arrange a voice traffic, to hold video conferences¡±, notes Andrei Mokrinsky.
Before the conversation is over, the managing director is asked a question that is rather sharp, if specific Russian conditions are taken into account: how does the management at ZSMK find ¡®the golden mean¡¯ between conducting a socially responsible business and the necessity to free the integrated plant from the nonspecialized activity and the excessive social infrastructure?
As Andrei Mokrinsky believes, the separation of nonspecialized assets from the basic business cannot be regarded as giving up a socially oriented policy. ¡°We do not reduce the concrete social package, which every employee has at the plant as well as at the nonspecialized units¡±, says the managing director. ¡°Interests of these employees are taken into account: in this respect mechanisms of contract relations are put into effect¡±.
Andrei Mokrinsky stresses that the social policy of the management company, EvrazHolding, is built upon interaction with Russia¡¯s ore mining labor union, while principles of social partnership serve as a basis. In his words, the priorities of this policy at ZapSib are to support retirees, improve health of employees and their families, work with youngsters and solve housing problems. In 2004 over $15 million were allocated for implementing social programs. Besides, being the region¡¯s largest enterprise the West Siberian Steel Corporation provides a considerable sponsorship assistance and is actively engaged in charity.

Photo captions:

¡°Gates¡± to the West Siberian Steel Corporation
Oxygen-converter shop No.2
Managing director Andrei Mokrinsky 

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