MECHEL ANNOUNCES FINANCIAL LEASE CONTRACT FOR MAINLINE DIESEL LOCOMOTIVES

Moscow, Russia – August 5, 2011 – Mechel OAO (NYSE: MTL), one of the leading
Russian mining and metals companies, announces the signing of a three-party
contract between Mecheltrans Vostok OOO, Sinara-Transport Machines OAO, and VTB
Leasing OAO for development, production and delivery of TEM-8 type locomotives.
The contract stipulates that in 2012-2014 Lyudinovsky Diesel-Locomotive Building
Works (part of Sinara-Transport Machines OAO) will deliver 18 single-sectional
eight-axle TEM-8 locomotives to Mecheltrans Vostok OOO.
The new mainline single-sectional TEM-8 locomotive will be developed on the
basis of the servicing of the TEM-7A electric-transmission switcher locomotive
and equipped with the 2,206-KW power installation produced by GE Transportation
Parts LLC (USA).
“The locomotives we are leasing will be used on the 315-kilometer Ulak-Elga rail
branch, which links Mechel Group’s Elga Coal Complex with the Baikal-Amur
Mainline. Sinara-Transport Machines will develop locomotives specially suited to
use in mountainous areas and intricate climatic conditions, which will not only
enable us to use the Ulak-Elga railway with maximum efficiency, but also save on
transport expenses. In accordance with production plans for Elga Coal Complex
before 2014, these leased locomotives will allow us to ensure prompt and timely
delivery of Elga coal. We are glad that our long-time partner VTB Leasing is
part of this deal,” Mecheltrans Management OOO’s Chief Executive Officer
Alexander Starodubov commented.
Mecheltrans OOO is Mechel Group’s transport operator, providing freight
forwarding of no less than 50 million tonnes of cargo annually. The operator
transports Mechel’s products to Russia and the CIS as well as further abroad. It
arranges exports bound for Europe and Pacific Asia. A major part of the cargo
goes through land border-crossings to China, Ukraine, Slovakia, Romania, Bosnia
and Herzegovina.
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Mechel OAO
Ekaterina Videman
Phone: + 7 495 221-88-88
ekaterina.videman@mechel.com
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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, nickel, steel, ferrochrome, ferrosilicon, rolled products,
hardware, heat and electric power. Mechel products are marketed domestically and
internationally.
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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.