MOSCOW, Feb 27 (Reuters) - Russian steel maker Severstal CHMF.MMCHMFq.L will invest $500 million in a new facility at its main plant to produce beams for Russia's fast-growing construction sector, the company said on Wednesday. The project is due for completion by 2011 and is part of a $6 billion investment in Severstal's Russian steel division, the company said in a statement. The 1 million-tonne-per-year beam plant will be installed at its Cherepovets Iron and Steel Works.
“The facilities will manufacture large rolled products for the construction industry to meet the growing needs of the construction market in Russia’s northwestern region,” said Anatoly Kruchinin, general director of the Cherepovets plant.
Severstal, Russia’s largest steel maker including foreign assets, has previously said it plans to invest $10 billion between now and 2011, including at its North American division.
The company says $6 billion of this total will be spent in Russia, where it forecasts the construction market will grow by 20-25 percent a year to 2010.
The beam facility will comprise an arc furnace, ladle furnace, continuous casting machine and rolling mill.
Severstal is also building two $500 million mini-mills to produce bars and wire rod in central Russia. Both will be launched in 2010: one in Balakovo, in Saratov region, and the other in Dzerzhinsk, in Nizhny Novgorod region.
The Cherepovets steel plant is Russia’s second-largest standalone mill after Magnitogorsk Iron and Steel Works. Severstal also has assets in Italy and the United States.
Reporting by Robin Paxton; editing by Chris Johnson
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