MMK to do without its own ore.

The company will sell the Kulmyakovsk plot.

The Magnitogorsk Iron and Steel Works (MMK) plans to sell Kulmyakovsk iron ore deposit purchased in 2011 for the self-sufficiency of the company with raw materials. Since buying the site the company has decided to change its strategy, abandoning the priority of the expanding of its raw materials sources. The analysts believe the sale is the manifestation of the general conservatism of the industry: the companies carefully invest into long term projects in the current economic situation.

On August 12th Victor Rashnikov’s OJSC "MMK" Board of Directors decided to sell the LLC "Kulmyakovsk", which holds the license for the Kulmyakovsk iron ore deposit in the Chelyabinsk region, stated MMK yesterday. This site with the starting price of 25 million roubles was acquired from the auction in 2011 (according to unofficial sources for 27.5 million roubles). The inferred resources of the Kulmyakovsk area are small: 20 million tons of P1 category and 60 million tons of P2. Even if the P1 resources are confirmed, with an annual consumption of 18-19 million tons of ore that amount would be enough to MMK for a year, a source close to the company stated.