October 07, 2008

OneSteel to invest AUD 20 million in Newcastle facilities

Mr Geoff Plummer MD & CEO of Australian OneSteel announced investments in excess of AUD 20 million at two of its production facilities in Newcastle. The investments will take OneSteel’s technology in rail wheels and wire rope to world’s best practice, allowing OneSteel to continue to meet customer requirements in these rapidly growing niche markets.

One investment redevelops and upgrades the wheel plant at the Waratah steel mill to enhance its position as a major supplier of rail wheels both domestically and internationally. The new technology will upgrade the Waratah plant’s capability to satisfy the developing requirements of the premium end of the market. The AUD 14 million investments will also improve safety and increase efficiency, so lowering the overall cost base. By increasing manufacturing capacity by 21,000 wheels to 105,000 wheels per annum, OneSteel will be able to maintain its existing share in this growing global business with a very high degree of sustainability and market differentiation.

OneSteel also plans to install a plastic injection and rewinding facility at its wire rope plant at a cost of around AUD 8 million. The investment builds on OneSteel’s 150 tonne capacity closing machine that manufactures 6 and 8 strand rope for the mining industry. The facility will allow for the production of fully plastic injected ropes up to 95 mm in diameter. As a result, OneSteel will be able to supply a full suite of mining ropes to the Australian and international markets. Globally, modern open cut mining operations are increasingly using fully plastic injected rope in face shovel machines to improve rope life and reduce wear and maintenance.