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Moscow, Russia – January 14, 2015 – Mechel OAO (NYSE: MTL), one of the leading Russian mining and metals companies, announces signing a memorandum of understanding with China’s steelmaking major Baosteel Resources corporation, which provides for an increase of coal supplies to 1.4 million tonnes of coking coal a year.

According to the memorandum, Mechel will supply Baosteel Resources with up to 1.4 million tonnes of coking coal. The agreement will be valid from April 2015 through March 2016, with a possibility of further prolongation. Prices will be determined on a monthly basis.

The memorandum also provides for a possibility of supplying Baosteel with other Mechel products, such as PCI and steam coal, as well as cooperation in other areas, including the possibility of collaboration with the economic development institutes in Russia and China.

Mechel is fully meeting its obligations according to the earlier contract, which provides for supplies of 1.2 million tonnes of coking coal a year. Since April 2014 through December, over 1 million tonnes of coking coal was shipped to Baosteel enterprises in China’s eastern and southern provinces, which accounts for 10% of Mechel’s coal exports to Asia Pacific.

“Long-term export contracts are particularly important for us in the period of FX volatility as they provide Mechel with stable foreign currency revenue. We are currently exporting over 70% of our mining division’s products,” Mechel OAO’s Chief Executive Officer Oleg Korzhov commented.

• [Editor:Phillip.Feng]