February 9, 2009 / 4:29 PM / in 11 years

UPDATE 1-Russia's Mechel gets $1 bln Gazprombank credit line

(Adds quote, more details, background)

MOSCOW, Feb 9 (Reuters) - Russian miner Mechel (MTL.N) has received a $1 billion credit line from Gazprombank to help it repay short-term debt, Mechel said on Monday.

The credit facilities provided by Gazprombank, the banking arm of Russian gas export monopoly Gazprom (GAZP.MM), have a three-year term.

“The new long-term credit facilities allow Mechel ... (to) navigate the near-term economic challenges while continuing to execute on our long-term strategy of developing production assets,” its chief financial officer, Stanislav Ploschenko, said in a statement.

The metals and mining group said late last year it was seeking to refinance debt used to fund its $1.5 billion purchase in 2008 of British ferrochrome producer Oriel Resources OLR.L (ORL.TO).

As of Sept. 30, 2008 Mechel’s total debt stood at $5.08 billion. The group also last month agreed to borrow $255 million to fund the construction of a mill for steel rail production in Chelyabinsk. (Reporting by Alfred Kueppers and Amie Ferris-Rotman; Editing by Greg Mahlich)

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