UPDATE 1-Mechel says to work with govt after Putin criticism

MOSCOW, July 25 (Reuters) - Russia's top coking coal miner Mechel (MTL.N) responded to an attack on its pricing policy from Prime Minister Vladimir Putin by promising on Friday to work with the government, helping its shares to rally.

After its statement, the shares regained some of the $5 billion wiped off the previous day, when Putin criticised a difference between its export and domestic prices for raw materials.

In the terse statement, Mechel did not protest about Putin's comments and said it would cooperate with the government.

At 1644 GMT, shares in Russia's largest coking coal miner were up 13.84 percent at $26.01.

"Mechel shares the concerns of the government of the Russian Federation, steel plants and metallurgical industry in regard to the growth in prices for steel products and raw materials in recent times," Mechel said in the statement.

"Mechel is ready for cooperation with federal authorities of the Russian Federation and, if required, will provide complete information on any arising issues," it said.

Putin singled out Mechel's raw materials pricing policy as detrimental to the national interest on Thursday, hurting investor sentiment and helping push Russia's benchmark RTS index into bear market territory on Friday.

Mechel's pricing policy is already subject to an investigation by Russian anti-monopoly authorities and the decline in investor confidence threatened to derail a preferred share placement planned for August.

Earlier on Friday, a statement carried on Russian state news agency RIA Novosti quoted Mechel as saying it would never again charge a different price for coking coal on the domestic market than it did abroad.

Mechel said it had not released the statement and the remarks appeared on RIA's wire due to a technical error, tipping the stock off an intraday peak of $27.91.

The confusing news flow resulted in volatility in Mechel's stock, as it fluctuated between a recovery of 14 percent and more than 21 percent.

But it remained firmly in positive territory the whole day, as traders and analysts agreed that the sell-off in its shares on Thursday had been a drastic over-reaction to Putin's televised remarks.

Those remarks hacked 37 percent from Mechel's stock value in Thursday trading. (Reporting by Simon Shuster, editing by Anthony Barker)