DTEK halts coal mining in Russia due to accident

Obukhovskaya mine in
Russia stopped its coal mining operations on Aug. 16 due to an explosion in its
longwall, the Interfax news agency reported on Aug. 17. Premature detonations
of explosions occurred during preparations for a blasting operation in a mine.
One person was killed and five were injured in the accident, while there is no
information on damage to the mine, Interfax reported. Mining operations have
been halted for the period of the investigation of the accident. Obukhovskaya
mine is part of Ukraine’s largest energy holing DTEK and a key supplier of
anthracite coal to the power plants of DTEK Energy (DTEKUA).

Alexander Paraschiy: Based on DTEK Energy’s business plan briefly presented in its 2017
annual report presentation, the holding counted on the supply of 1.6 mmt of
anthracite from its related Russian mine in 2018, which fulfills more than 80%
of its power plants’ anthracite needs. Should DTEK commit to this plan (which
looks not likely at the moment), the accident won’t spoil it as the halt in
mining at Obukhovskaya looks to be brief. All in all, we see no material effect
from the accident on DTEK Energy’s fundamentals.