February 20, 2020

PAO Severstal, one of the world’s leading vertically integrated steel and
steel-related mining companies, announces the construction of long-range wire
mill 170 in the long-rolling production segment at Cherepovets Steel Mill (part
of Severstal’s Russian steel division). The total investment is expected to
amount to approximately 11 billion rubles.

Alexander Shevelev, CEO of Severstal, commented:

“In the highly competitive and volatile market in which we operate, we must
be agile and smart in our investment decisions. We need to think ahead and
predict the future requirements of our customers; in this way, we are investing
in our company’s future. The new mill will allow Severstal to considerably
improve our long product and metalware supply chain, end-to-end. We will take
on our subsidiary Severstal-metiz’s microstructure and strict requirements in
terms of long product surface quality and will also be able to expand our
product range; in particular, mill 170 will have the capacity to produce a
14-32 mm diameter circle.”

The mill line will include a heating furnace, a hydraulic descaling unit,
stands 3, 4, 5 and 6, a laying head, a Stelmor air cooling line, a Garret
winder line with a rotating coil and a packing line. The total length of the
mill will be 550 meters.

The unit will have an annual design capacity of 1 million tons. The launch
of mill 170 is planned for the second half of 2022. Severstal estimates that
the new mill will account for about 8% of the Company’s project costs in 2020.
These figures are already factored into the disclosed capital investment