Securing the position as a major coking coal supplier in Russia

Key developments in 2017

• Consistent product quality helped to retain Russian market leadership;
• Production volumes rose;
• Investments to expand and overhaul production facilities helped to boost output of saleable products;
• Open-pit mining was launched at the Raspadskaya-Koksovaya mine site;
• Coal mining was resumed at the Raspadskaya mine’s production seam no. 6;
• Investments into the new flotation equipment at the third section of Raspadskaya’s beneficiation plant helped to improve product quality.

Outlook for 2018

• Maintain leading positions on the Russian market by keeping product quality consistent;
• Improve reliability of deliveries;
• Increase premium low vol. HCC production volumes;
• Boost saleable products volume to c. 18 million tonnes by increasing mining volumes at the Raspadsky open-pit with additional equipment, as well as increasing mining efficiency at other assets;
• Launch flotation at Raspadskaya’s first and second sections (full +1.5% yield effect from 2019).

Increase sales to Ukrainian market

Key developments in 2017

• Maintained sales volumes to Ukraine.

Medium-term outlook

• To increase annual sales to Ukraine.

Expansion of the export portfolio

Key developments in 2017

EVRAZ achieved its targets for 2017 export sales by:

• Maintaining a flexible sales geography:
  • Export priorities: Ukraine, Japan, South Korea, and Vietnam;
  • Entering new markets, like Indonesia, and expanding geographical diversity within Europe;
  • Sending some volumes to China via spot contracts;
• Conducting site visits for new clients and regular audits at the request of key customers.

Coking coal export volumes to countries in South-East Asia exceeded 4.3 million tonnes (up 25% year-on-year). Additionally, exports to Turkey and other European countries increased by 1 million tonnes (a six-fold increase).

Outlook for 2018

• Ensure a diverse sale geography by seeking new supply routes from Baltic Sea ports;
• Increase export sales to South-East Asia and European countries.