Business
Amendment of transshipment agreement
Amendment of transshipment agreement.
About this update from Evraz Plc
[{"type":"text","content":"\n \nRNS Number : 2781Y Evraz Plc 31 December 2019 \n\nAMENDMENT TO THE TRANSSHIPMENT AGREEMENT WITH NAKHODKA TRADE SEA PORT\nEVRAZ plc (\"EVRAZ\", the \"Company\" and together with its subsidiaries, the \"Group\") announces today that it has signed a Deed of Amendment (\"Transaction\") in relation to the Long-Term Transshipment Agreement (\"LTA\") between East Metals AG (the \"EMAG\"), a fully owned subsidiary of the Company and Nakhodka Trade Sea Port (the \"Nakhodka Port\") previously concluded as a part of the disposal of Nakhodka Port in May 2017.\nIn the Transaction, parties have agreed:\n1. to decrease rates for excess volumes of transshipped coal for 2020,\n2. to approve new rates for transshipment of steel products (including fumigation cost of dunnage for steel products). \nKey Commercial Highlights\n1. The parties have determined and agreed on a new lower rate for excess volumes of transshipped coal. \n\n\n\n\nTERM\n\n\n2019\n\n\n2020\n\n\n\n\nRates for transshipment of excess volumes of coal (exceeding agreed quotas)\n\n\nUS$19.0 /per metric t\n\n\nUS$15.0 /per metric t\n\n\n\n\n \nNew rates are comparable with the rates set by the Nakhodka Port for the third parties. This will allow EVRAZ to transship additional volumes of coal to the Far East at a lower cost. The cap for excess coal volume has not changed and remains at approximately 2.7 million metric tonnes. \n2. EMAG requested additional services from Nakhodka Port regarding the use of wooden dunnage for transshipment of steel products corresponding to the ISPM 15 standard. Thus the parties have agreed to increase by US$1.7 the rates for transshipment of steel products (such were disclosed in the LTA published in May 2017).\n \nPursuant to UK Listing Authority (\"UKLA\") Listing Rule 11.1.4R, Nakhodka Port is classified as a related party of EVRAZ, due to its direct shareholders also being substantial shareholders in the Company. The Transaction, therefore, constitutes a smaller related party transaction as defined under UKLA Listing Rule 11.1.10R and EVRAZ has accordingly obtained a written confirmation from a sponsor that the terms of the transaction are fair and reasonable as far as shareholders of EVRAZ are concerned.\n \nBackgroun...