Severstal Starts Building a 10 Million Tonne Iron Ore Pellet Plant in Cherepovets

MOSCOW, September 24, 2024 — Russian steel maker Severstal has started to build an iron ore pellet plant at its Cherepovets production site, the company announced. The new facility, designed for 10 million tonnes of pellets per year, is to be commissioned in 2026 and has been reported to cost about 97 billion roubles, making it one of the largest industrial projects under way at the company's flagship steelmaking hub.

Construction already under way at the Cherepovets site

"Work is underway to build roasting, pelletizing and crushing facilities, control and desulphurization facilities," Severstal said in a statement reported by Interfax on September 24, 2024. The announcement confirms that the project, first outlined by the company in the autumn of 2023, has moved from planning into active construction.

The pellet plant was formalised under a special investment contract (SPIC 2.0) signed in June 2024, which sets the framework for the facility with a capacity of 10 million tonnes per year. Reported investment in the project stands at 97 billion roubles, with commissioning targeted for 2026.

Key parameters of the project

• Product: iron ore pellets to serve as the company's own blast furnace feedstock.
• Designed capacity: 10 million tonnes per year.
• Location: Severstal's Cherepovets site, home of the Cherepovets Steel Mill.
• Investment: about 97 billion roubles, as reported.
• Legal framework: special investment contract (SPIC 2.0) signed in June 2024.
• Commissioning: 2026.
• Scope of works: roasting, pelletizing and crushing facilities, plus control and desulphurization facilities.

What the pellet plant changes for the Cherepovets Steel Mill

The core purpose of the project is to replace external and sintered feedstock with pellets produced on site. According to Severstal, the new plant will supply the Cherepovets Steel Mill's blast furnaces with their own feedstock and improve their productivity by 9%.

Sintering machines to be phased out

Switching the blast furnace charge to pellets will enable several sintering machines to be decommissioned. Sinter production is one of the most energy- and emission-intensive stages of the integrated steelmaking route, so its partial retirement is a structural change to the site's production chain rather than a cosmetic upgrade.

Environmental effect of the switch to pellets

Severstal links the decommissioning of the sintering machines directly to a measurable reduction of emissions at the Cherepovets site:

• Greenhouse gas emissions: reduced by more than 2 million tonnes per year.
• Other pollutants: reduced by 133,000 tonnes per year.

For a site of this scale, the combination of higher blast furnace productivity and lower emissions per tonne of iron is the main industrial logic behind the investment.

Background: from announcement to construction

1. Autumn 2023 — Severstal announces plans to build its own pellet production facility in Cherepovets.
2. June 2024 — the company signs a special investment contract (SPIC 2.0) for a pellet plant with capacity of 10 million tonnes per year.
3. September 24, 2024 — Severstal confirms that construction of the roasting, pelletizing, crushing, control and desulphurization facilities is under way.
4. 2026 — target commissioning year for the plant.

Company and contacts

Severstal is one of Russia's largest vertically integrated steel and mining companies; the Cherepovets Steel Mill is its principal production site. The start of construction and the project parameters above were announced by the company in a statement reported by Interfax on September 24, 2024.

Contacts: Severstal corporate statement of September 24, 2024, as cited in the Interfax news report (MOSCOW, Sept 24, Interfax).

Website: https://www.severstal.com/