A. Project Opportunities

A 1. Project Name

аа) Short name: "Creation of 57" all-steel radial OTR tire production". b) Full name: "OTR Tire Plant, Main Building. Creation of 57" all-steel radial OTR tire production". c) Aim of the Project: Production of the new generation of tires for mining equipment, to be compliant with the leading foreign manufacturers and to meet the demands of automobile industry in the Republic of Belarus, as well as of mining industry in the CIS and worldwide countries.

A 2. Project Status

Pre-investment stage. A business plan has been worked out, design and estimate documentation has been examined. Process is being adjusted; tender documentation to purchase equipment is being elaborated.

A 3. Organizations Involved and Their Role

Belshina JSC - borrower, Republic of Belarus, Mogilev region, Bobruisk Mr. Nikolay Chirun, Director General Tel. +375 (225) 43 43 90 Fax +375 (225) 43 31 11, 44 63 88

A 4. Project Description

Creation of 57" all-steel radial OTR tire production will increase production output due to enlargement of products assortment, raise of labour productivity and quality of produced goods, improvement of labour conditions. New tires are designed as OEM for BelAZ, Komatsu, Caterpillar, etc. dumpers. The project is expected to be implemented in the period of  2017. Achievement of this investment project allows to raise labour productivity, to lower fuel-energy resource consuming, save and improve competitive position in the home and foreign markets, to increase export potential.

A 5. Prerequisites/History/ Overall Program/ Related or Similar Projects

Belshina Joint Stock Company (JSC) was established in 1972 as an enterprise of petrochemical industry. The enterprise was state-owned before 26.09.2002.  At present the share of government in the authorized capital of the company is 100 %. Due to high level of technical and technological tooling, high-skilled personnel, high production and labor organization standards the company is capable of producing high-quality tires of various standard sizes de-pending on the market conditions. The territory is 172.6 hectares, of which 104.2 hectares are built-up. Key activities of Belshina JSC: production of tires for heavy-duty dump trucks and super heavy-duty dump trucks,  for construction, road-building and materials-handling vehicles,  tractors and agricultural vehicles, motor cars and light trucks,  trucks and buses and re-treaded tires. Belshina JSC includes: Giant Tire Plant is a manufacturer of tires for dump trucks of high load-carrying capacity, construction and road vehicles, trailers, and agricultural machinery.  OTR tire plant is a manufacturer of tires for heavy-duty dump trucks that are operated in open cast mines of metal mining industry.  Belshina JSC is the sole producer of OTR tires among the tire plants in CIS coun-tries. Car and truck tire plant produces tires for truck families such as MAZ, GAZ, ZIL, buses, and agricultural machinery. It also produces tires for motor cars such as VAZ, Moskvich, Volga, and practically all types of imported cars. Mechanical plant produces polymer and optional equipment and spares, performs major repairs of equip-ment at the tire plants The company output is marketed in the Republic of Belarus and exported to more than 50 countries world-wide.  Exports account for more than 60% of total sales. Russia is a major foreign trade partner, exports to Russia account for 41% of total exports. The share of certified products is 90%. The plant has been certified for compliance with the international quality system standard ISO 9001 - 2000.

A 6. Summary of Environmental Impact

Significant emissions are within the permissible limits. Modern equipment and technologies will permit to reduce total emissions, reduction of fuel and power consumption including.

A 7. Potential Obstacles/Problems/Risk Level

The most important risk to which Project implementation is exposed is the growth of prices for raw materials and supplies.

A 8. Project Implementation and Payback Period

Project implementation period: 5 years Payback period: 6.17 years.

A 9. Industry Classification of Project

Petrochemical

B. Capital Cost Items (Total investment requirement for project implementation)

В 1. Physical components of Project (equipment, works, services, etc for Project implementation)	В 2. Capital '000 EURO
Purchase of equipment, including spare parts and installation supervision	25700
Other costs	1605
Total	27305

C. Available Capital by Source

С 1. Source type	C2. Amount,'000 EURO
Internal funds of Belshina JSC	1605
Total	1605

D. Investment Requirement, Shortage

D 1. Underinvestment, Kind of Financial Assistance

Crediting  - 25700

D 2. Sources of finance	D 3. Type of instrument	D 4. Amount, '000 EURO
Credit facilities	Credit, loan, direct investment	25700

E. Demand (Customers) and Income

E 1. Customers/markets, volumes, prices, revenues, estimated profit/saving

Consumers of products to be produced: domestic market (BelAZ), CIS markets (open-mine dumpers), world markets (India, Indonesia, Africa, Australia). Production volume of 57" OTR tire is 2.2 thousand units/year.

E2. Revenues (sales)	Е 3. Amount, '000 EURO
Revenue from sales of tires	12257

F. Operating and maintenance expenses

F1. Cost components, cost coverage strategy, and management of production

To implement the project, the enterprise has unused production space, utilities and liner networks, power sources, and part of equipment required therefore. No need of new buildings and structures.

F 2. Cost items	F3. Amount, '000 EURO
TOTAL costs of marketing	9161

G. Net income

G 1. Receipts E2 less operating expenses F2	G2. Amount, '000 EURO
	3096

H. Source of Information on Project

H1. Form filled by (Name, post):

Dubasov Dmitri Yurjevich , Head of Advanced Development and Investment Department

H2. Organization (name and address):

Belshina JSC Republic of Belarus, Mogilev region, Bobruisk, Minsk Highway

H3. Tel./Fax/E-mail:

8 (0225) 43 43 90; 43 31 11, 44 63 88; belshina@belshina.biz

H4. Date:

01.09.2011

H5. Superior organization:

-