Vale SA has announced detailed plans for a 5 million tonnes a year steel mill in Espirito Santo State.

According to a Vale statement, the new mill will be innovative and preoccupied with the environment. The Anchieta mill project, will be called Companhia Siderurgica Ubu. Environmental licensing caused the abandonment of Vale's previous project to build a USD 3 billion steel mill at the Anchieta site.

In January 2009, Vale and China's Baosteel ended a steel mill JV in Espirito Santo because of environmental objections, centered around water questions.

Vale said that it was studying measures to avoid water shortages at Anchieta and aimed to recycle 97% of water used at the mill. Vale would also look at the possibility of desalination.

Furthermore, Vale said it would take action to reduce particulate pollution at the proposed mill. The new mill will also require a new deepwater port terminal at the site and will be served by a new coastal railroad.

If licenses are obtained then work on CSU could begin in 2011 and operations in 2014.

(Sourced from www.dowjones.com)