MECHEL ANNOUNCES ELECTRIC ARC FURNACE NO. 2 COMMISSIONING AT ITS TIKHVIN
FERROALLOY SMELTING PLANT SUBSIDIARY


Moscow, Russia – June 01, 2009 – Mechel OAO (NYSE: MTL), one of the leading
Russian mining and metals companies, announces that Electric Arc Furnace No. 2
at its Tikhvin Ferroalloy Smelting Plant (JSC “TFZ”) was started up after its
repair.
Electric Arc Furnace No. 2 at Mechel’s Tikhvin Ferroalloy Smelting Plant
subsidiary was commissioned on May 27, 2009. Thus, three electric arc furnaces
(EAFs) currently operate at the plant with only one EAF remaining in stand-by
mode.
JSC “TFZ” is the youngest ferroalloy smelting plant in Russia. It comprises four
EAFs with 22.5 MVA capacity each, which are designed to smelt high-carbon
ferrochrome. The process of the furnaces commissioning took place from April
2007 to April 2008.
From October 2008, the plant’s operations were limited due to decrease in demand
for its products and increased prices for imported chrome ore. From October 2008
to May 2009, ferrochrome was smelted with only two furnaces operating with
underutilization of their capacities. Owing to such measures, the plant managed
to keep its operability and staff composition. During that time, scheduled
maintenance was performed by the plant’s own personnel, which enabled increasing
the equipment’s effectiveness. Specifically, the plant’s water-cooling system
has been repaired and gas cleaning system tubes have been replaced with those
capable to operate under higher temperature, which improved quality of waste gas
treatment.
From January 2009, steady supplies of high quality chrome ore commenced from the
new Voskhod Chrome Mining Plant (Kazakhstan), which is a part of Mechel’s
ferroalloy sub-holding, Oriel Resources Ltd. At the same time, increase in
demand for high-carbon ferrochrome was observed on the markets from April 2009.
Combination of these two factors made it possible to increase utilization of the
plant’s capacity.
“The increased utilization of capacities of our ferroalloy subsidiaries, Tikhvin
Ferroalloy Smelting Plant and Southern Urals Nickel Plant (commissioning of the
latter’s shaft furnace No. 8 was announced previously) proves that our
ferroalloys segment development strategy and our anti-crisis program are quite
efficient. We supported each of the Group’s ferroalloy plants with its own raw
material base and thus ensured our independence from expensive imported ore. It
also enabled us to fully utilize our production chains’ synergy. The scheduled
maintenance works performed during the period of lower demand allowed us to
increase performance of the equipment. And, at last, careful monitoring of the
market situation allowed us to promptly respond to the demand growth taken shape
and to increase utilization of the equipment in a view of the orders available
in our order book,” Mechel OAO Senior Vice President Vladimir Polin commented.

***
Mechel OAO
Ilya Zhitomirsky
Phone: + 7 495 221 88 88
ilya.zhitomirsky@mechel.com
***
Mechel is one of the leading Russian companies. Its business includes four
segments: mining, steel, ferroalloy and power. Mechel unites producers of coal,
iron ore concentrate, steel, rolled products, ferroalloys, hardware, heat and
electric power. Mechel products are marketed domestically and internationally.
***
Some of the information in this press release may contain projections or other
forward-looking statements regarding future events or the future financial
performance of Mechel, as defined in the safe harbor provisions of the U.S.
Private Securities Litigation Reform Act of 1995. We wish to caution you that
these statements are only predictions and that actual events or results may
differ materially. We do not intend to update these statements. We refer you to
the documents Mechel files from time to time with the U.S. Securities and
Exchange Commission, including our Form 20-F. These documents contain and
identify important factors, including those contained in the section captioned
“Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in our
Form 20-F, that could cause the actual results to differ materially from those
contained in our projections or forward-looking statements, including, among
others, the achievement of anticipated levels of profitability, growth, cost and
synergy of our recent acquisitions, the impact of competitive pricing, the
ability to obtain necessary regulatory approvals and licenses, the impact of
developments in the Russian economic, political and legal environment,
volatility in stock markets or in the price of our shares or ADRs, financial
risk management and the impact of general business and global economic
conditions.