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Severstal
Russian steel and mining company From Wikipedia, the free encyclopedia
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Severstal (Russian: Северсталь, lit. 'Northern Steel') is a Russian company mainly operating in the steel and mining industry, headquartered in Cherepovets. Severstal is listed on the Moscow Exchange and LSE and is the largest steel company in Russia. The company is majority-owned and controlled by billionaire Alexey Mordashov.
Severstal owns major industrial facilities in Russia, Ukraine, Kazakhstan, France, and Italy, as well as in several African countries. The company also has mining assets, thus securing its supply of raw materials.
Severstal also owns Severstal Cherepovets, a professional ice hockey club which plays in the Kontinental Hockey League and Severstal Air Company, an airline operating mainly from Vnukovo International Airport and Cherepovets Airport.
Severstal has been ranked as among the 16th best of 92 oil, gas, and mining companies on indigenous rights and resource extraction in the Arctic.[2] It's ranked 37 among the largest steel makers. In 2021, Severstal was ranked no. 27 out of 120 oil, gas, and mining companies involved in resource extraction north of the Arctic Circle in the Arctic Environmental Responsibility Index (AERI).[3] In 2021, the company's revenue amounted to 770 billion rubles.[4]
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History
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1930s–1993: Formation and early development
In the early 1930s, deposits of iron ore were discovered on the Kola Peninsula, while significant reserves of coal were identified in the Pechora region.[5] These discoveries enabled the establishment of a steel industry in northwestern Russia.
In 1940, the Government of the Soviet Union issued a resolution entitled "On the Organisation of Steel Making in the North-West of the USSR", authorizing the construction of a steel mill in Cherepovets, a city strategically located on the Leningrad–Ekaterinburg railway and the Volga–Baltic Waterway. Construction of the Cherepovets Steel Mill began shortly thereafter.
In 1947, construction of the facility was completed, and on 24 August 1955 at 15:25, the mill was officially commissioned. Over the following decades, Cherepovets developed into one of the key steel production centres in the Soviet Union.
On 24 September 1993, a decree by the President of Russia, Boris Yeltsin, transformed the state-owned Cherepovets Iron and Steel Complex into Severstal, an open joint-stock company.
2004–2011: International expansion and acquisitions
In 2004, Severstal North America was established following the acquisition of all steelmaking assets of Michigan-based Rouge Steel.
In April 2005, Severstal purchased a 19.9% stake in the European steel producer Gruppo Lucchini. The company was listed on MICEX SE in June 2005.
In March 2006, Severstal made an offer to acquire French conglomerate Arcelor.[6] The bid was ultimately unsuccessful after Arcelor was acquired by Mittal Steel Company in June 2006.
Also in April 2006, Severstal and Arcelor inaugurated the Severgal joint venture (75% Severstal; 25% Arcelor).[7] During the same month, Severstal acquired British wire producer Carrington Wire.[8]
Between 2006 and 2008, Severstal further expanded through multiple acquisitions in Europe, Russia, the United States, Kazakhstan and Africa, including Sparrows Point (Maryland), Esmark Inc. (West Virginia), and WCI Steel (Ohio). The company also invested in gold mining, acquiring Celtic Resources, Aprelkovo, Nerungri Metallic, Balazhal Gold Mine, and later High River Gold.
In 2008, the company began a US$500 million expansion of Severstal Columbus, aiming to double production capacity.[9]
From 2010 to 2011, Severstal continued restructuring its international assets, acquiring the remaining shares of Gruppo Lucchini and Crew Gold, creating Nord Gold NV, and divesting several U.S. mills in 2011.[10]
Developments since 2013
On 11 February 2013, an explosion occurred at the Vorkutinskaya mine in the Komi Republic, resulting in the deaths of 18 miners.[11]
In March 2012, the company completed its separation from Nord Gold.[12]
In 2014, Severstal divested its remaining U.S. steelmaking assets, selling its Dearborn, Michigan, and Columbus, Mississippi, facilities for a combined US$2.3 billion.[13]
In 2017, Severstal sold Redaelli Tecna and acquired the debt of the Yakovlevsky mine.[14]
In December 2021, as part of its decarbonization strategy, Severstal agreed to sell "Vorkutaugol" to Russkaya Energia LLC for 15 billion roubles.[15] Approval of the transaction was postponed by the Federal Antimonopoly Service in February 2022.[16]
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International sanctions
Following the 2022 Russian invasion of Ukraine, the European Union sanctioned Severstal's majority shareholder, Alexey Mordashov, on 28 February. This forced the company to cease its steel shipments to Europe.[17]
Along with other major Russian corporations, in 2023 Severstal was included in the sanctions lists of Australia,[18] Canada,[19] the United Kingdom, and the United States. According to the British authorities, "PJSC Severstal is and has been obtaining a benefit from or supporting the Government of Russia by carrying on business in a sector of strategic significance, namely the Russian extractives sector and; (2) PJSC Severstal is owned or controlled directly or indirectly by a person involved in obtaining a benefit from or supporting the Government of Russia, namely Alexey Mordashov."[20] According to the Australian authorities, measures against Severstal and other sanctioned companies "aim to slow Russia's war machine."[18]
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Sustainable development and corporate responsibility
Sustainable development is one of the strategic priorities for Severstal, as stated in its annual reports.[21] Starting 2010, the company has annually released a Corporate Social Responsibility and Sustainable Development report.[22]
In 2018, Severstal joined the UN Global Compact.[23]
At the same time, since 2000, Severstal has been a sponsor and patron of TK-20 Severstal, a nuclear submarine of the Russian Navy, which was renamed after the company in 2001.[24][25][26] In 2000-2005 alone, Severstal donated 5.5 million rubles to support the submarine and its crew.[24]
Environment
In 2018, Severstal became one of the pilots of the World Steel Association's programme to reduce greenhouse gas emissions by the global steel industry 'Step up'.[27]
In June 2019, in connection with the Presidential Decree dated 7 May 2018 No. 204 "On the National Goals and Strategic Objectives of the Development of the Russian Federation for the Period up to 2024" and the Federal Project "Clean Air", Severstal agreed on co-operation for reducing air emissions in Cherepovets with the Ministry of Natural Resources and Ecology, Rosprirodnadzor and the local authorities. In accordance with this agreement, the company assumed obligations to ensure the implementation of measures that will reduce pollutant emissions by 30 thousand tons into the atmosphere by 2024.[28]
Severstal reported Total CO2e emissions (Direct + Indirect) for the twelve months ending 31 December 2020 at 27,860[29] Kt (-250 /-0.9% y-o-y). There is no evidence of a consistent declining trend as yet.
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References
External links
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