RUXX Index: Mechel Stands to Lose Mining Licenses, Sees Cost of Debt Rise

RUXX Index continues covering MTL amid its license conflict as the company's valuation affects the overall index.

New York -- April 18, 2012 -- Russian steel and mining giant Mechel may lose three coal mining licenses at Yakutugol, its core mining subsidiary, over license violations. This news creates a significant downside risk for the stock.

A recent inspection by Prirodnadzor, the Russian environmental watchdog, discovered that Yakutugol was behind on mine infrastructure construction, may be mining outside its license area limits, that some of its mines were below required production volumes, and that it did not keep proper records, the agency’s statement says.

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