July 30, 2020

PAO Severstal (“Severstal”; “the Company”), one of the world’s leading
vertically integrated steel and steel-related mining companies, today announces
a public target to cut its greenhouse gas emissions intensity by 3% over the
next three years compared with 2020 . It is the first stage of a longer-term
strategy to reduce its carbon footprint and increase its contribution to
meeting the goals set by the Paris Climate Agreement.

We have identified the following investment projects that should contribute
most significantly to this target are: the construction of long-range wire mill
170, implementation of argon purging of metal in a steel casting ladle from
production to casting, increasing the share of sintering ore from Yakovlevskiy
Mine in sintering mix, the reconstruction of the solid fuel unit Sinter plant 2
as well as the launch of top-pressure recovery turbines #16 & #25.

In addition, Severstal has revised and upgraded its total atmospheric
emissions reduction targets for 2025. Following the Company’s decision to fit
new gas cleaning equipment at the Cherepovets Steel Mill’s sinter processing
plant, Severstal now expects to reduce its total atmospheric emissions by 13%
(66,500 tonnes) against 2017 levels, compared with the previously announced
target of 7%.

Alexander Shevelev, CEO of Severstal, commented:

“Severstal recognises the urgency for the steel industry to reduce
its direct and indirect emissions and contribute towards the goals of the Paris
Climate Agreement and is wholly committed to showing leadership in reducing its
own climate contribution. For this reason, we continue to challenge ourselves
to achieve more in this area.

The three-year GHG emissions intensity reduction target we have set
is underpinned by detailed programmes and a roadmap of specific investment
projects giving our stakeholders confidence that the 3% reduction is a
near-term commitment rather than an abstract promise.

It is important to note that as a vertically-integrated company, we
control and bear responsibility for emissions at every stage of our production
chain – from the extraction of raw materials to the development of finished

In the first half of 2020, Severstal has already invested 1.34 billion
roubles in environmental initiatives, compared with approximately 750 million
roubles in the full year 2019.

Further information:

Since 1990, the intensity of greenhouse gas emissions from steel
production at the Cherepovets Steel Mill (Severstal’s main asset, “CherMK”) has
decreased by 43%. According to the World Steel Association (“worldsteel”),
Severstal is in the first quartile of companies in the steel industry with the
lowest greenhouse gas emissions. Greenhouse gas emissions intensity of CherMK
in 2019 amounted to 2.08 tonnes of CO2 equivalent / tonnes of liquid steel
(Scopes 1–3). Over the past year, Severstal has climbed three places in the
worldsteel ranking of companies with the lowest specific greenhouse gas
emissions to rank 13th out of 64 companies with comparable

Severstal was the first Russian company in the industry to pilot the
worldsteel “Step up” programme, which aims to find production processes along
the entire production chain that can be improved to achieve the greatest
results in terms of reducing greenhouse gas emissions. According to an expert
assessment, the greatest impact is possible from the introduction and
development of innovative technologies, more efficient methods of generating
electricity, reducing consumption factors in the blast furnace and steelmaking
processes, and using better quality raw materials.

More information available –