Maintenance outsourcing for MMKLifecycle partnership
Magnitogorsk Iron & Steel (MMK) ranks among Russia’s largest steel producers, accounting for 20% of the country’s production. Founded in 1932, the company today covers the entire process chain of iron and steel making – from ore through to strip processing.
The relationship between MMK and SMS group dates back to these beginnings, ranging from the construction and delivery of complete mills to modernizations, revamps, spare part deliveries, multiple service contracts and cooperations. There is almost too much to mention, without writing a book about it. So, let’s focus on just a few of the more pre-eminent examples:
MMK’s benefits at caster No. 6 included a higher performance, a ramp-up curve, which was 33% better than planned and a plant availability of 86 percent. With regard to savings, the SMS maintenance team decreased the life cycle costs of the annual maintenance budget by more than 15 percent compared to equivalent plants in the MMK group. Impressive results.
As a result, MMK extended the cooperation on caster No. 6 by three more years. Based upon the success with this caster, SMS group took over the servicing of MMK’s remaining 5 slab casters, which are actually third-party systems – built in the 1980’s and 1990’s – increasing the number of SMS group service crew members to a total of 650.
The long-standing cooperation between MMK and SMS group also laid the foundation for successful teamwork also under extremely challenging conditions. In February 2020, MMK decided to reconstruct and upgrade the two-stand four-high Compact Cold Mill. The mill was originally supplied by SMS and had been in operation since 2002. After a thorough assessment of the equipment jointly with SMS, MMK decided to integrate the state-of-the-art and future-proof technological features, which were already operative in their slab casters, including an extensive service contract with the SMS group Technical Outsourcing Service (TOS).
“Given the current, global COVID-19 crisis, we were faced not only with technological challenges in this project. My special thanks goes to MMK’s and our own teams. Thanks to their strong commitment, dedication and pragmatic approach, it has been possible – even under the restrictions due to the pandemic – to complete this project according to schedule, with the production of the first coil after only twelve months.”
Marc Hoffmann, Executive Vice President, Flat Products of SMS group
Working on the future of metals
This long history of cooperation has put MMK and SMS group in an excellent position for future developments. In that spirit, a Memorandum of Understanding (MoU) was signed between Magnitogorsk Iron and Steel Works and SMS group in 2021, cementing common goals. This MoU states the intention of both companies to cooperate in the development and use of decarbonization technologies in order to reduce CO2 emissions, potentially to zero. ‟In today's reality, due to the imminent introduction of the EU’s cross-border carbon regulation (CBAM), reduction of the ‘carbon footprint’ is fast becoming one of the key tasks and the biggest challenge for global metallurgy”, said Pavel Shilyaev, CEO of MMK.
The ongoing partnership between MMK and SMS group is certainly extraordinary. Dating back almost 100 years, both companies have found extreme value in each other’s body of work and their mutual understanding of what is needed in today’s steel production. If a good example of a Lifecycle Partnership can be found anywhere, it must be here.