Oct. 4 (Bloomberg) -- Ukraine’s Interpipe Group, owned by billionaire Victor Pinchuk, opened a $700 million electric steel mill in Dnipropetrovsk with an annual output capacity of 1.32 million tons of steel for its seamless pipe production.
The Interpipe Steel plant will provide 90 percent of the steel needed for pipe production by 2014, the company said in an e-mailed statement today. The second phase of the steel plant may increase output to 2 million tons a year.
“Should markets show a more or less stable demand for our products, we will be able to quickly increase volumes of steel production at our new plant,” Pinchuk said today in Dnipropetrovsk. “All infrastructure necessary for the construction of the second stage is in place,” he said.
Investment in the factory will be covered in three to four years, Pinchuk said, adding that steel not needed for pipe production may be exported to western Europe.
Interpipe forecasts sales to the European Union will increase 20 percent in the second half compared with the first six months after the EU cut import tax for producers, Oleksandr Kirichko, the company’s director general, told reporters in Dnipropetrovsk.
Interpipe will ask the government to cut electricity prices to the electric steel mill, according to Kirichko. The new plant will allow Interpipe to replace open hearth steel production with less energy consuming technologies, the company said in the statement.