Aug. 8 (Bloomberg) -- OAO Mechel, the Russian company planning to sell shares in a mining unit, said the subsidiary had 3.271 billion metric tons of coal reserves as of May 1, according to international standards for estimates.
OAO Mechel Mining has 4.373 billion tons of coal resources under Australia’s JORC classification system, the company said today in a statement. Of that total, 3.14 billion tons are coking coal. Mechel Mining has 267 million tons of iron ore reserves and 427 million tons of iron ore resources, the statement shows.
The deposits are enough for 110 years of mining, at Mechel’s current rates of coal production, George Buzhenitsa, a Moscow-based analyst at Deutsche Bank, said by phone today.
Mechel picked JPMorgan Chase & Co., Morgan Stanley and UBS AG to manage an initial public offering for Mechel Mining, two people familiar with the process said July 22. The company may sell a stake of 10 percent to 15 percent in London and Hong Kong this year, they said.
Mechel fell 5 percent to 568 rubles by the 6:45 p.m. close in Moscow. The 30-stock Micex Index fell 5.5 percent.
To contact the reporter on this story: Yuliya Fedorinova in Moscow at firstname.lastname@example.org
To contact the editor responsible for this story: John Viljoen at email@example.com