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Vale iron ore transshipment project in Malaysia to cost up to MYR 14 billion
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Saturday, 22 Jan 2011
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The Star reported that Brazilian mining giant Vale International SA's construction costs in its iron ore trans shipment project will be between MYR 9 billion and MYR 14 billion over a 5 year period and the project will likely start in July or August 2011.

Dr Zambry Abdul Kadir Perak Mentri Besar Datuk Seri said that Vale has received the necessary planning and statutory approvals. It is now in the midst of drawing up the engineering plan.

While the Perak government has no equity participation in the project, it will participate in the port and logistics operations. There will also be co sharing with local companies on the downstream activities. The multiplier effect of the downstream activities is expected to triple Vale's initial investment.

Dr Zambry said that "Vale has agreed to bring more economic growth along that area. Local companies will be subcontracted to participate in the trickle down activities. They will include Malaysian companies involved in iron ore, steel, fabrication, shipbuilding, canning and tin."

Dr Zambry said that under the project, Vale will develop an iron ore complex, including its own jetty in Teluk Rubiah in Lumut. He added that "This will be Vale's largest factory outside Brazil. All the necessary acquisitions have been made; it is just a matter of coming out to do it now."

He said the ship building activities would take place along the beachfront from Lumut to Bagan Datok. He added that "Some of the local shipbuilders may build the smaller ships to transship the iron ore in the latter phase."

Dr Zambry said that the first of the two phase Vale project will create jobs for 1,000 skilled workers. Over the entire two phases, jobs would be created for 3,000 skilled workers and a few thousand unskilled workers. The figures do not include the spin off effects from the downstream activities.

Dr Zambry said that "The Perak State Development Corporation has started drawing up a value chain roadmap based on the presence of the Vale project in Malaysia. We will identify and promote foreign and domestic direct investments using the project as a base."

With Perak's strength in natural resources, he said the state was once again opening up the tin sector to increase its revenue. Perak stands to receive 5% in royalties from tin players. He added that "Tin prices have been increasing due to high demand and shortage of supply. We are now in the midst of considering applications both for licensing of exploration and concessions."

(Sourced from www.thestar.com.my)

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