Update - Rescue Operation at Vorkutaugol

Update - Rescue Operation at Vorkutaugol

PAO Severstal provides an update in regard to the rescue operation that has been ongoing at the Severnaya mine, one of the five coalmines of AO Vorkutaugol. 

Shortly after 2pm on 25 February an underground rock burst occurred at Severnaya. 110 miners were working in the mine at the time of the incident. On 26 February the Company updated that 80 colleagues had been safely evacuated to the mine's surface, while a further eight colleagues had been admitted to a local hospital with non-life threatening injuries. Tragically, four miners had been killed and rescue operations were ongoing to save 26 missing miners.

Following a third blast at the Severnaya mine on Sunday 28 February, five rescue workers and one miner were killed. The Company is deeply saddened to announce that on 28 February, the Emergency Commission determined that, due to the degree of destruction and the level of methane gas concentration in the mine, all of the missing miners were presumed dead.

Mining operations at Severnaya remain suspended. The Emergency Commission has preliminary determined that the initial blast was caused by geological reasons rather than men's error or equipment failure. At the moment the decision has been taken to block off the hazardous area, drain out oxygen via nitrogen compression and begin restoration works, which could take several months to complete. Employees at the Severnaya have been placed on paid leave while longer-term options are considered. An assessment for the continuation of mining operations at Severnaya is underway, but experts say that if the planned restoration works are successful, the mine can return to full-scale operations within 6-12 months. All the other Vorkutaugol's four mines and one open pit operate as business as usual.

The health and safety of its employees is the Company's first priority. The directors and management of Severstal and Vorkutaugol express their deepest condolences and will provide support to the families, colleagues and friends of those affected by this tragic incident.

Severstal will provide further updates as soon as the information becomes available.

In 2015, the Severnaya coal mine produced approximately 1.5 million tonnes of 2Zh grade coking coal concentrate, which is approximately 27% of Vorkutaugol's overall production of coking coal concentrate in 2015 (5.6 million tonnes)

For further information, please contact:

Severstal Investor Relations

Victor Drozdov

T: +7 (495) 926-77-66

victor.drozdov@severstal.com

Severstal Public Relations

Anastasia Mishanina

T: +7 (495) 926-77-66

anastasia.mishanina@severstal.com 

Severstal's financial communications agent - Hudson Sandler

Andrew Hayes / Elena Garside / Alex Brennan

T: +44 (0) 20 7796 4133