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Work is continuing at the company's rolling mill, whereas operations at the steel casting unit have been halted temporarily but will resume in the coming days, said Kovalenko.

So far, Ukrainian investor KVV Group has invested EUR 50 million in resuming production at Liepajas metalurgs. "Unfortunately, we had to revise our optimistic plans regarding the steel casting facility, as production costs do not ensure competitiveness as compared to products of similar metallurgical companies in other European Union countries and regions of the world," said Kovalenko.

"We have to concede that the main reason is the mandatory procurement component in the electricity tariff, which, according to our estimates, accounts for a large part of production costs – EUR 12 million annually if the plant is operating in full swing," said Kovalenko. "We know that the ministry in charge of the matter is already working to solve the problem as soon as possible. Regrettably, we nevertheless have to revise our production plans, and put on hold that part of the plans that deals with increasing production volumes and starting work in three shifts at the steel casting facility," he explained.

This has also altered the company's staffing plans – the company has no choice but to lay off some part of workers. "We hope that the question of the mandatory procurement component and its impact on production will be resolved, and we will be able to start full-scale operations at the plant and hire more workers, as we were originally planning to do. We are hoping for assistance from municipal and state officials," added Kovalenko.

As reported, since the resumption of production in March, KVV Liepajas metalurgs had produced 90,000 tons of steel rebars by mid-May. Furthermore, since the re-opening of the company's steel melting facility, KVV Liepajas metalurgs employed a total of 960 persons at the beginning of May.

On May 8, the steel melting facility had 195 employees working in two shifts and producing 30,000 tons of steel a month.

"At the moment, 90% of the company's produce is exported to Algeria. However, exports to Poland, Germany, and Finland are also slowly kicking off," Kovalenko said on May 15.

LETA also reported, the Ukrainian company KVV Group won the Liepajas metalurgs tender and the right to acquire the metallurgical plant for EUR 107 million. The company's insolvency administrator Haralds Velmers and Valery Krishtal signed the Liepajas metalurgs sales agreement on October 2 last year.

In the past Liepajas metalurgs used to be one of the largest industrial companies in the Baltic States, as well as one of the largest exporters of Latvia, it accounted for about 0.7-1% of Latvia's gross domestic product.