MECHEL ANNOUNCES COMMISSIONING THE FOURTH ELECTRIC FURNACE AT TIKHVIN FERROALLOY
SMELTING PLANT


Tikhvin, Russia – June 30, 2009 – Mechel OAO (NYSE: MTL), one of the leading
Russian mining and metals companies, announces that electric furnace No. 1 at
Tikhvin Ferroalloy Smelting Plant (JSC “TFZ”) has been commissioned. JSC “TFZ”
is a subsidiary of Oriel Resources Ltd. (Great Britain). Today all of the four
electric furnaces concurrently operate at Tikhvin Ferroalloy Smelting Plant.
Oriel Resources Company Ltd. (Great Britain), acquired in April 2008 and
representing Mechel’s ferroalloy segment, unites all the ferroalloy assets of
the Group: Tikhvin Ferroalloy Smelting Plant (St. Petersburg region), Southern
Urals Nickel Plant (Orenburg region), Bratsk Ferroalloy Plant (Irkutsk region),
Voskhod mining and processing plant (Kazakhstan), which develops chrome ore
deposit. The company Oriel also owns Shevchenko Nickel Deposit in Kazakhstan.
The programme of equipment modernization and production output volume bringing
to the pre-crisis level is implemented at all Oriel Resources’ plants. Electric
furnace No. 1 that has been commissioned at JSC “TFZ” became the last of the
four units at the plant put into continuously operating regime. Currently, three
electric furnaces are brought to 14 MVA capacity and the capacity of electric
furnace No. 1 will be gradually increased to reach its full load. Thus, Mechel
increases its output of high quality ferrochrome, an alloy required to produce
stainless and special steels.
Tikhvin Ferroalloy Smelting Plant is currently 100% provided with high quality
chrome ore supplied from Voskhod Mining and Processing Plant (Kazakhstan). Owing
to its operations, JSC “TFZ” completely gave up purchases of imported raw
material of lower quality and became capable of utilizing its production
equipment more efficiently and increasing the quality of its products.
Ferrochrome produced by the plant is consumed by the Group’s subsidiaries and is
also supplied to the market. Approximately 85% share of JSC “TFZ” sales
comprises export sales. Ferrochrome is shipped to Japan, USA, Germany, India,
China, and other countries of the world.
“Tikhvin Ferroalloy Smelting Plant’s output tends to reach the indicators
comparable to its designed capacity. This is mainly due to our correct choice of
ferrochrome segment development strategy. Provision of our ferroalloy
subsidiaries with their own raw material base gives us additional margin of
economic steadiness and efficiency. I would also like to emphasize that the
orders volume we already have in summer 2009 practically matches the designed
capacity of Tikhvin Ferroalloy Smelting Plant and commissioning of the fourth
electric furnace at the plant would enable us to bring the ferroalloy segment’s
output volumes to the pre-crisis level,” Alexey Ivanushkin, Chief Executive
Officer of the Oriel Resources Company Ltd. commented.
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Mechel OAO
Ilya Zhitomirsky
Phone: + 7 495 221 88 88
ilya.zhitomirsky@mechel.com
***
Mechel is one of the leading Russian companies. Its business includes four
segments: mining, steel, ferroalloy and power. Mechel unites producers of coal,
iron ore concentrate, steel, rolled products, ferroalloys, hardware, heat and
electric power. Mechel products are marketed domestically and internationally.
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Some of the information in this press release may contain projections or other
forward-looking statements regarding future events or the future financial
performance of Mechel, as defined in the safe harbor provisions of the U.S.
Private Securities Litigation Reform Act of 1995. We wish to caution you that
these statements are only predictions and that actual events or results may
differ materially. We do not intend to update these statements. We refer you to
the documents Mechel files from time to time with the U.S. Securities and
Exchange Commission, including our Form 20-F. These documents contain and
identify important factors, including those contained in the section captioned
“Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in our
Form 20-F, that could cause the actual results to differ materially from those
contained in our projections or forward-looking statements, including, among
others, the achievement of anticipated levels of profitability, growth, cost and
synergy of our recent acquisitions, the impact of competitive pricing, the
ability to obtain necessary regulatory approvals and licenses, the impact of
developments in the Russian economic, political and legal environment,
volatility in stock markets or in the price of our shares or ADRs, financial
risk management and the impact of general business and global economic
conditions.