DTEK Increases Investment Into Coal

DTEK, the energy wing of System Capital Management, said that it would invest USD 1.1 bln in the coal sector, USD 400 mln more than announced by DTEK’s CEO in March 2007. Most of the funds will be invested into environmental safety. New technologies designed to boost output and decrease costs will also be installed; DTEK is negotiating with German DBT and DMT to purchase new mining equipment for Pavlohrad Coal that will increase its daily extraction almost threefold to 5 ths mt. Overall, DTEK expects to lift coal extraction about 50% by 2012 to 22 mln mt. Most of the increase will come from Pavlohrad Coal (46.6% by 2012), while Komsomolets Donbasa (SHKD: U/R) will also see a small increase (14.3% by 2012). DTEK also reiterated its March announcement that it will direct USD 380 mln into electricity generation by 2012.