Russian miner, Mechel OAO MTL announced that its unit – Mecheltrans-East OOO – has inked a four-year contract on locomotive maintenance works with Sinara Transport Machines OAO (STM).
Per the contract, STM's subsidiary STM-Service will fully service and repair TE8 locomotives manufactured at STM's Lyudinovsky Locomotive Plant to Mecheltrans's order. The service and repair work will be done at the repair depot at Verkhny Ulak station, located on the Mechel-constructed Ulak-Elga railway which links the Elga coal deposit (among the world's most large-scale industrial projects) with the Baikal-Amur Mainline.
According to the contract, STM will set up a specialized service center and training personnel and will create a stockpile of spare parts and consumables, which will help to run the business efficiently in this remote area.
The servicing will cost about 120 million rubles per year. The machines are produced so that they can be utilized in difficult climatic conditions and mountainous areas.
Presently Mecheltrans-East's locomotive park includes 15 TE8 locomotives and 3 TEM18DM shunting diesel locomotives. According to Mechel, it is very important for it to conduct timely maintenance and quality repairs of the locomotive park at its production facilities. This will enable the company to save transport costs, have a high rate of its locomotives' technical readiness, resulting in a reliable resource in meeting its cargo traffic plans.
Recently, Mechel inked a new deal with Russian Railways OAO's Center of Corporate Transportation Services, including organization of cargo train traffic by reserved routes with fixed arrival and departure times.
The deal is valid from Apr 1, 2015 till Dec 31, 2015. The routes in which Mechel Group's railway operator will be able to avail Russian Railways OAO’s services are the one from Yakutugol Holding Company OAO (part of Mechel Group) to Trade Port Posiet OAO (part of Mechel Group, located on the coast of the Sea of Japan) and from Port Vanino OAO. The routes from Southern Kuzbass Coal Company OAO to Trade Port Posiet OAO and from Southern Kuzbass Coal Company OAO to Port Vanino OAO will also be included.
Mechel is a leading steel and coal producer, with a strong position in key businesses, including the production of specialty steel and alloys.
Stocks to consider in the steel industry include Evraz Highveld Steel & Vanadium Ltd. HGVLY, Commercial Metals Co. CMC and LB Foster Co. FSTR. All carrying a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Be the first to comment