July, 24 2005
ONGC & Mittal join hands
In a bid to acquire oil acreage abroad, the petroleum ministry has managed to rope in steel tycoon, Mr LN Mittal. He has joined hands with the government owned Oil and Natural Gas Corporation (ONGC). India can now use Mr Mittals influence in central Asian and African countries for acquisition of oil and gas blocks.
Mr Mittal and ONGC today floated two joint venture companies to target oil and gas opportunities abroad to ensure energy security for the country in the wake of rising oil prices in the international market.
The joint venture is a win-win proposition for ONGC as well as Mr Mittal. While India would use Mr Mittals influence in oil producing countries, Mr Mittal would diversify his business from steel to the energy sector.
The petroleum ministry is planning to cash in on the goodwill enjoyed by Mr Mittal, London-based NRI, who is known for his steel business worldwide, particularly in countries such as Kazakhstan. In fact, PetroKazakhstan would be the first target of the newly formed joint venture.
The joint venture is going to help Indian bids for global oil giants including Unocal, said an elated Union minister for petroleum and natural gas, Mr Mani Shankar Aiyer, who was instrumental in persuading Mr Mittal to join hands with the government owned PSU.
As per the memorandum of understanding signed by ONGC and Mr Mittal, the former will hold 49.98 per cent stake in both the joint venture companies while Mr LN Mittal, who till now focused only on the global steel business, will have 48.02 per cent equity in the energy venture. The remaining two per cent would be with ICICI.
Both the companies will acquire stakes in overseas oil and gas blocks and energy-related businesses and the joint venture will be registered outside India. According to ONGC, the first joint venture company, ONGC Mittal Energy Ltd, a joint venture between OVL the overseas arm of ONGC and Mittal Investments Sarl, would focus on acquisition of oil and gas firms and exploration business.
The second company, ONGC Mittal Energy Services Ltd, will look at related businesses such as refining, petrochemicals, pipelines, LNG, shipping and energy trading.
The Indian government had requested us to go into oil business since our business is in oil dominating countries, said Mr Mittal. The deal capitalises on ONGCs domain knowledge in oil and gas and the Mittal Groups expertise in global business.
ONGC chairman and managing director, Mr Subir Raha said the joint ventures were for securing energy security for India through global resources. Mr Aiyar complimented Mittals global strides and said he had found an able match in visionary Mr Raha who thinks out of the box and who is willing to reach for the stars... This is a partnership of strong and confident (companies) to increase their strength exponentially, he said.
In Kazakhstan, where the Mittal Group has a huge business interest and considerable influence over the government, OVL has been eyeing a stake in Kurmangazy oilfield besides interests in Makhambet and Satpayev exploration blocks. It was also interested in taking over $3.5-billion PetroKazakhstan, which has all its assets in Kazakhstan.
OVL hopes to use Mittal Groups influence to acquire the company which owns 500 million barrels of reserves, 1,50,000 barrels a day of crude output and a refinery in Kazakhstan.
The Canada-based company has had strained relations with the Kazhak government, which has a veto power on any equity sale.
Mr Raha said despite the joint venture with the Mittal Group, ONGC would continue to pursue partnerships with global oil giants such as Rosneft and Gazprom of Russia.
OVL managing director, Mr RS Butola said by joining hands with the Mittal Group his company was aiming to acquire big companies
Govt backs Mittal's proposed plant in Jkarkhand
Government on Saturday assured NRI global steel magnate LN Mittal that sufficient iron ore will be provided for his proposed 10 million tonne steel plant in Jharkhand.
Mittal met Steel Minister Ram Vilas Paswan, who said Government would look into policy issues for providing all possible facilities to investors.
"The biggest concern is availability of iron ore. The Ministry has given assurance and would address the issue in National Steel Policy that is being prepared," Paswan told reporters after the meeting.
"We have set a target of 120 million tonne of steel production by 2020. This cannot be met by Government alone. The private sector has to be roped in for the purpose and the Ministry would definitely try to make things easier for producers," he said.
He said the deal between Korean major Posco and Orissa government was a very positive development as would be the MoU between Mittal's company and Jharkhand government.
Mittal is going ahead with a 10 million tonne plant in Jharkhand with phase I to produce 3-4 million tonnes.
RINL weighs pellet plant in Jharkhand
Rashtriya Ispat Nigam Ltd (RINL), which owns the Vishakhapatnam Steel Plant, is considering a joint venture with the state-run National Mineral Development Corporation (NMDC) for setting up a pellet or sponge iron plant in Jharkhand.
The public sector steel maker wanted to acquire some iron ore mines in the mineral-rich state, but the Jharkhand government is not inclined to let iron ore go out of the state without any value addition. So the company is contemplating pellet or sponge iron making facility in the state. Iron ore rich states are inclined to give mining lease to only those companies that set up plants there.
RINL sources iron ore from NMDC, but it wants to scale up the mineral supply to feed its capacity expansion to 7 million tonne (mt) by 2007 from 3.5 mt at present. NMDC has identified some mines for RINL in Jharkhand and has also filed applications for their mining lease.
We are looking at the most cost effective measure to secure ore for our plant. Even as iron ore would have been the best option, we have to look at sponge iron or pellet route, a senior RINL official said on the sidelines of the 44th annual general meeting of Indian Refractory Makers Association in the city on Saturday. The company has tried out the pellet route and the sponge iron process is being tested, the official added.
A number of steel makers in the country are looking at new or split-up units to secure iron ore mining lease. JSW Steel, for example, had earlier planned to set up a steel plant in Bengal at an investment of Rs 12,000-crore investment. The company is now considering splitting it between Jharkhand and Bengal in order to get ore mining lease. Meanwhile, RINL is eyeing multiple deals for coal mining abroad. It has identified three miners in Canada, Colombia and Australia.
RINL is, however, cautious on making investment abroad. Given the phenomenal rise in coal prices from $56 a tonne to $125 a tonne, the miners are seeking a premium for giving a stake. The Canadian company, for instance, is seeking $75 million for a meagre 10 per cent stake.
Being a public sector company, we have to be cautious about making such a hefty investment, said S.R. Kamath, executive director of RINL.
Overseas coal equity, however, will not suffice the requirement of the company when it expands steel making capacity to 7 mt going forward. For a 7-mt plant, RINL will require about 7 mt of coal.
The participation in coal mining abroad will provide additional volume along with the existing long-term contracts. At present, coal samples are being tested to see if they are compatible with long term contract. Coal from the Canadian mine has been found suitable.
Centre reviewing iron ore export policy
Even as the Government is reviewing the export policy on how much of iron ore should be allowed to go out of the country, informed sources in the Government told Business Line that exports could be 25 per cent to 30 per cent lower this fiscal.
According to rough estimates by the Government authorities, iron ore exports are expected to be a little over 60 million tonnes this year, down from around 78 mt in 2004-05 against a total production of 145 mt.
The main reason for the expected decline in exports is because spot prices of iron ore have come down by around 30 per cent during the April-July period, despite the fact that some of the largest iron ore producers in the world such as CVRD of Brazil, Rio Tinto and BHP Billiton effected a steep hike in their long-term contracts for the current financial year. Adding to the woes are the falling Chinese demand.
Official sources said that an Indian team of iron ore exporters, including officials from National Mineral Development Corporation (NMDC), Kudremukh Iron Ore Company Ltd (KIOCL), and a few more private parties are in Beijing, negotiating iron ore prices with Chinese buyers.
While the Indian companies had offered a price of $55 per tonne of iron ore, the Chinese buyers are insisting on a price of $43 per tonne. "Moreover, even at the lower price Chinese companies are not ready to enter into even six months contracts, anticipating that prices may fall further," industry sources said.
On the other hand, the Government's internal review of the iron ore export policy is being subjected to the conflict of interest between the Ministry of Steel and the Commerce Ministry.
Official sources said that Ministry of Steel is in favour of curtailing iron ore exports on the grounds of preserving national resources and also under pressure from the domestic steel industry.
But the Commerce Ministry is against any such curtailment because its effort is to boost the total export performance.
Steel Exports down & Imports up in Q1
The import-export figures of finished steel for the first quarter have been released by the Joint Plant Committee (JPC) under the Steel Ministry.
According to estimates, finished steel imports during the first quarter increased to 5.4 lakh tonne against 4.48 lakh tonne during the corresponding quarter last fiscal, marking an increase of 20.5 per cent.
Exports during the quarter stood at 8.75 lakh tonne against 9.35 lakh tonnes during the corresponding period of the previous fiscal.
US based International Watch support POSCO Investment
Facing strong opposition from various quarters on setting up a multi-billion steel plant in the poor Orissa State, the Chief Minister, Navin Patnaik, and the Korean steel giant, Posco, seems to have found a friend in the United States.
Apprehending that such opposition might once again scuttle a project, having potential to take Orissa on the path of industrialization, U.S.-based International Watch has begun to lobby for the steel plant among the top leadership of all the political parties to neutralize and contain such hostilities.
It has further gone ahead to set up a $5 million (about Rs. 22 crores) Tribal Trust Fund to ensure proper and humane rehabilitation of the tribals who would be displaced as a result of the project.
"We have already put the fund in a separate account. This is just a beginning. If need be we would bring more for the cause. We do not want that another project of such a nature is scuttled," P. Narayanan Kutty, of the International Watch, told the sources.
The non-governmental International Watch, which works in the field of discovering and revealing hidden truth regarding financing connections between world corporations and terrorist organizations, would soon open its office in Bhubaneshwar for this purpose, he said.
Sesa Goa: No signs of slowdown yet
A booming steel industry coupled with increasing demand for iron ore from China and other Asian countries has opened up opportunities for India's largest private sector iron ore exporter Sesa Goa (SGL). The company is into iron ore mining and has a turnover of over Rs.1500 crore. Mitsui &Co, Japan holds 51% in the group.
SGL has diversified into manufacturing of pig iron and metellurgical coke. It has mining operation in Goa, Karnataka and Orissa and has recently been granted the Prospecting License for the state of Jharkhand. The company is planning to invest Rs 250 crore for developing mine in this state for meeting the growing demands of China.
The company has an export percentage of above 90% and China accounts for 50% of the total exports. SGL is insulated from any possible slump in ore prices due to term contracts with most of its overseas customers. Out of 9.8 MT ore produced last year, it exported around 8.8 MT and sold the rest domestically. The domestic demand for iron ore is also buoyant. A look at the group sales figure for the last 5 years gives a fair idea of the steady growth the company had in sales and also the spurt in sales realisations over the last 2 years.
Major iron ore exporters in India are National Mineral Development Corp, Kudremukh Iron Ore Corp, Sesa Goa. NMDC is the single largest exporter with 23.14 MT of ore exports in 2004-05. SGL's profit (PAT) moved up by 186% to touch Rs. 473.2 crore in the last financial year backed by almost 72% rise in its top line.
JSSL: Backward integration to cut costs
Jindal Stainless Steel Ltd (JSSL) is one of the flagship companies of the Jindal group of companies with a production capacity of 530000 MT. For the year ended March 31, 2005, the company recorded sales growth of 30.47 % to touch Rs 3147.69 crore over a net profit growth of 41.29 % to Rs 231.98 crore, respectively.
JSSL is a manufacturer of wide range of steel products like coils and plates and caters to the growing demand in the infrastructure, railways, construction and auto industries in the domestic as well as Export market. It is in the manufacturing of chrome manganese 200 series, which is considered as one of the fastest growing grades and is used extensively in China for architecture, building & construction.
The company has initiated major capacity expansion plans in Hisar and Dubri in the state of Orrisa to facilitate its product line. By the end of the next two years it is expected that some of the products like Ferro Chrome, Ferro Manganese, Silico Manganese will be produced through inhouse facilities. These materials constitute almost 35-40% of overall raw material cost. This is expected to reduce the cost of production, which in turn will improve the overall competitiveness of the company.
Company is eyeing the growing demand from the Indian Railways/Metro Rail, which currently consumes nearly 6000 MT/year. At the same time other sectors like construction auto, pipe & tubes, white goods, dairy process, and capital goods are expected to generate the demand. On the export front company is looking at demand from Asian and European markets. As per the estimates of the ISSF (International stainless steel forum) stainless steel demand in Asia is expected to grow by 12% annually. The export of the Company has registered a growth of 289.9% in Q1FY06.
For the quarter ended June 30, 2005, Jindal Stainless Steel Ltd (JSSL) has recorded an income of Rs 856.85 crore over a net profit of Rs 66.1 crore, a growth of 32.4% and 31.9%, respectively. Interestingly, the operating profit margins of the company have come down to touch 15.76% from 17.08% in the previous year.
The operating profit margins of the company has declined marginally, with the rise in the raw material cost which has gone up by 34.9% and the Cost of power and fuel consumed has gone up by 34.40% during the same period.
NTPC to go for pit head power plants
NTPC, the country's largest consumer of coal and the largest power producer, has decided to go for integrated projects that involve the setting up of pithead power plants along with development of coal projects linked to the plant.
In the 11th Plan, the company plans to set up two power projects having a capacity of 6,000mw of power tied to coal mines that have a capacity of 30 million tonnes per annum, according to C P Jain, chairman and managing director. The power plants would be set up at Talcher in Orissa and Raigarh in Chattisgarh.
Jain said that NTPC consumes 100 million tonnes of coal from Coal India Ltd. While the acquisition and rehabilitation of the mines to be acquired would be done by NTPC, delivery and dispatch of the coal would be done by another agency, which would be selected by way of open tender. A joint venture with Coal India Ltd in this regard could not be ruled out, he added.
Mittals Next stop Jharkhand
Steel tycoon L.N. Mittal today said he would sign an MoU with the Jharkhand government in a couple of weeks to set up a steel plant in the state.
Mittals team in Ranchi is negotiating with the state government there. Mittal, who met steel minister Ram Vilas Paswan today, said he had been assured of iron ore supplies to run the plant. Paswan has assured him that a national policy for iron ore was being evolved for new steel manufacturing units and infrastructure problems would be addressed to.
Mittal said he was looking forward to investing in India as it would help to develop his global business.
Last month, Posco signed a deal with the Orissa government. The deal assures 600 mt of iron ore reserves to Posco in return for a 12-mt steel plant in the state.
Mittal has been trying for sometime to convince the Jharkhand government to part with precious iron ore concessions in and around Chaibasa district where SAIL has its Chiria mines. Mittal, on his part, has promised to set up a modular steel plant whose capacity would eventually go up to 10 million tonnes.
High prices of iron ore has forced most steel makers to hunt for ore and many of them are eyeing India as it, along with Brazil, has the largest and richest ore reserves.
State governments have also woken up to the possibilities of making money from their locked up mineral wealth and are trying to expedite leases.
The Jharkhand government has been trying to get back three extremely valuable mining leases from SAIL. If it manages to do so, the state may lease out some of these to private entrepreneurs like Mittal who have shown interest in investing in the state .
The Centre had till now maintained that the mines leased out to IISCO some 70 years ago should remain with SAIL to help its expansion plans
Russian steels alert on market downfall
Russian steel makers rising sales at home and their growing taste for specialty products may prove to be the best insulation against a downturn on the global steel market, producers and analysts said.
Abundance of raw materials and plenty of cash generated during the 2004 steel bonanza have turned Russian producers into global heavyweights, with many snatching assets abroad and debuting on Western stock exchanges.
But this years cool-down in the world steel market has alarmed the export-oriented sector, and mills like Magnitogorsk have begun shifting their focus towards the steel-hungry machinery and construction industries at home.
The share of exports in companies total sales is falling because Russias economy is growing and steel consumption is rising, said Slava Smolyaninov, a metals analyst at UralSib. Naturally, those who sell more products domestically will suffer less. Chinas decision to scrap the yuans peg to the dollar could also in the short term boost trade with neighbouring Russia, the worlds No. 2 steel exporter, analysts say.
The world price for hot-rolled steel, a benchmark product used to make cars and appliances, has fallen by more than a third from its peak last September and is expected to decline further this year.
And that has already had its toll on Russias most export-heavy companies like Novolipetsk.
In the first half of 2005, domestic producers raised output only marginally to protect prices and shield margins. Production rose just one percent to 33 million tonnes of crude compared with a rise of nearly 5 percent in the whole of 2004.
In June alone, output of steel, accounting for 20 percent of Russias total exports, fell 14.7 percent to 4.6 million tonnes. But serving the domestic market and focusing on specialty products are a good buffer, producers say.
Our strong position in Russia will help lower risks linked to global market volatility, Severstal said in remarks sent to Reuters. A big modernisation programme will help us keep costs low while expanding output of value-added niche goods.
It may take months for the Russian market, where companies tend to sell more value-added goods, to fully adjust to changes in the global business environment, mainly because specialty steel product prices are less elastic, analysts say. Russian steelmills, once obsessed with the Soviet-era emphasis on high volumes rather than quality, are now playing catch-up with Western rivals by focusing more on higher-quality, higher-margin products and specialty alloys and parts.
Alexander Pukhayev of United Financial Group says average domestic steel prices fell by six percent since the beginning of the year compared to the global fall of 30 percent. But you have to accept the fact that... prices would adjust eventually if global steel prices continue to fall, he said. Novolipetsk, which exports two-thirds of output to Europe and Southeast Asia, cut rolled output by nearly 10 percent to 3.3 million tonnes in the first half. Rival Magnitogorsks rolled production was largely flat at 5.2 million tonnes.
Mittal Steel USA plans vacation at Weirton
The president of the Independent Steelworkers Union said his membership is prepared to participate in next week's scheduled plant-wide vacation at Mittal Steel-USA's Weirton operations.
Glyptis said the majority of the union's rank and file membership as well as most of the plant's management employees will be on vacation next week as Mittal Steel slows local operations as part of an inventory adjustment in domestic steel production.
"I have been told on several occasions that the No. 1 Blast Furnace, which was banked May 27, will be brought back on line in September. So I anticipate seeing an increase in prep work in the Blast Furnace Department as well as the Basic Oxygen Plant/Caster in order to prepare our ironmaking and steelmaking facilities for full operations," Glyptis noted.
Mittal Steel-USA has taken similar steps at other plants, including furnace shutdowns in Cleveland. U.S. Steel took the nation's largest blast furnace, the Gary, Ind., works No. 13, out of production for much of the summer after announcing plans to renovate it.
Fording's Income up due to higher Coal Prices
Fording Canadian Coal Trust today announced strong second quarter results. Net income was $123 million in the second quarter, up from $13 million in 2004, largely due to higher metallurgical coal sales prices.
Net income before unusual items and future income taxes was $162 million in the second quarter of 2005 compared with $43 million in 2004. On a year-to-date basis, net income increased to $189 million from $23 million in 2004. Year-to-date net income before unusual items and future income taxes was $222 million in 2005 compared with $47 million in 2004.
Fording Canadian Coal Trust is an open-ended mutual fund trust. Through investments in metallurgical coal and industrial minerals mining and
processing operations, the Trust makes quarterly cash distributions to
unitholders.
The Trust, through its wholly owned subsidiary, Fording Inc., holds a 60% interest in the Elk Valley Coal Partnership and is the world's largest producer of the industrial mineral wollastonite. Elk Valley Coal, comprised of Canada's senior metallurgical coal mining properties, is the world's second largest exporter of metallurgical coal, and expects to supply approximately 27 million tonnes of high-quality coal products to the international steel industry in 2005.
Elk Valley Coal has six operating mines. The Fording River, Coal Mountain, Elkview and Line Creek mines along with the Greenhills mine (which
is operated by a joint venture in which Elk Valley Coal has an 80% interest)
are located in the Elk Valley region of southeast British Columbia. The
Cardinal River mine operates in west-central Alberta. Elk Valley Coal also
owns numerous other properties, including the coal preparation plant and coal resources at the former Quintette mine and other coal resources in British Columbia as well as a 46% interest in Neptune Terminals in Vancouver, British Columbia.
Iran exports 25,000 tons of alloy steel to Europe
Iran started to export alloy steel to Europe last year. Since then, some 25,000 tons of these alloys have been bought by European auto part manufacturers.
Some 6,000 tons of these products were exported in the past four months of the current Iranian year (March 20-July 20), said managing director of Irans Alloy Steel Company Mullahosseini.
German auto part manufacturers bought over 7,000 tons of Irans alloy steel last year, he added. Irans alloy steel production reaches 250,000 tons, he said, And we expect it to move up to 450,000 tons in the next three years.
He also pointed out that some 100 million dollars will be invested in this industry in a 3-year period
Allegheny County fines Shenango coke works $252,000
Allegheny County fined a coke works $252,000 for violating emissions standards and ordered it to change the way it operates.
The Shenango Inc. coke works on Neville Island must pay the fine and lengthen its normal 18-hour coking times to at least 24 hours by the beginning of next month, according to the county Health Department.
Shenango's violations were "significant exceedances of both county and federal emissions standards," the health department said.
The change should reduce the coke oven emissions, said Roger Westman, county air quality manager. The coke works complied with combustion stack emission limits 40 percent of the time in April and its 56 coke ovens complied with standards just 13 percent of the time, according to the health department.
Shenango was prepared for the fine, but was surprised that it was ordered to change the way it operates, said Jim Birsic, the company's vice president for health, safety and environmental law.
The coke works' production level of about 360,000 tons a year will probably decline if the order remains in effect, Birsic said. But he said he doubts the order will require the company to shut down or lay off any of its 165 employees.
Shenango has been fined about $2.4 million for pollution violations in the last five years.
Chinese Vice PM addresses Coal Industry conference
Vice-Premier Zeng Peiyan has stressed the importance of the coal industry to China's national economy, noting that despite rapid growth, problems such as serious accidents, belated environmental protection and the waste of resources must be tackled.
Addressing a national meeting on coal production, Zeng put forward five demands which included strengthening the management of coal resources, promoting the construction of large-scale coal production bases, accelerating the reform of coal enterprises, advancing the modernization of mining equipment and strengthening ecological and environmental protection.
Industries Qatar posts 46pc rise in H1 profitIndustries Qatar posts 46pc rise in H1 profit
Industries Qatar (IQ) recorded an impressive profit amounting to QR1,532m during the first half of this year as compared to the same period of last year, M S M Al Sherawi, chief coordinator of IQ, said yesterday.
This represents year-on-year growth of 46 per cent and is therefore indicative of the significant increase in sales, whilst also highlighting the cost control exercised and scale-efficiencies achieved by the company, he said.
He said that IQ sales grew by 42 per cent, emphasizing that it is one of the fastest-growing companies in Qatar. Sales volumes and prices grew significantly year-on-year, resulting in revenue for the period reaching QR3.1bn, making IQ one of the largest companies in the country, in terms of sales revenue. This marks an impressive profit margin of 50 per cent.
"With high international demand for our products and a buoyant world economy expected to continue, we expect this year-on-year growth to continue in 2005.
As the culture of cost control becomes embedded and the production plants continue to operate at high capacity, it is expected that profitability will continue to be strong during the year," he said.
He said that plans to increase production capacity and create additional world-class facilities are progressing smoothly. This capital investment will help ensure sustained sales growth and strong profitability in the future Major milestones this Quarter (April to June 2005) include Qasco signing an engineering, procurement and construction (EPC) contract with Danieli Officine Meccaniche, an Italian firm, to expand its steel melt shop at Mesaieed and boost annual capacity to 1.6 million tonnes.
Slater spins off 40m International Molybdenum
A company co-founded by Jim Slater, the 1960s asset stripper and stock-market tipster, is to float International Molybdenum on the Alternative Investment Market this Thursday, valuing the firm at about 40m.
It will be the first company to be spun off from Galahad Gold, where Slater is deputy chairman with 10% of the equity. Galahad will retain control of more than 80% of the shares when the company lists.
International Molybdenum will use the funds generated from its listing to develop its operations in Greenland, where it hopes to begin production in 2008. The price of molybdenum, used in the production of stainless steel, has risen from an all-time low of $2.36 per pound in 2001 to more than $30 per pound today.
Slater was the founder of the Slater Walker empire, and built fame and influence on the back of a 1960s stock-market bubble. However, the markets collapse in 1974 caused his empire to implode, leaving him facing debts of 3m. He slowly paid off his creditors and rebuilt his fortune through an eclectic mix of investments in property and fishing rights.
Polymet closer to opening new mine
PolyMet Mining Corp. has completed the geologic logging and sampling of 22 large-diameter drill holes at its proposed NorthMet non-ferrous mine south of Babbitt.
About 42 tons of the drill core will be tested later this summer for grade, chemistry and mineralogy at SGS Lakefield Research Laboratory near Toronto. Test results will provide information for environmental planning, review and permitting, according to a PolyMet news release.
PolyMet is planning to mine a 800 million-ton ore deposit that contains copper, nickel, cobalt, platinum, palladium and gold using some of the facilities at the former LTV Steel Mining Co. near Hoyt Lakes. The $235 million project would employ about 400 people.
Russia forms special economic zone
Russia plans to form its first special economic district between St. Petersburg and the Estonian border. RIA Novosti reports the district will be in Ust-Luga on the Gulf of Finland 60 miles from St. Petersburg.
Ust-Luga is already a coal transshipment center, and a port with a cargo-handling capacity of 35 million tons is under construction.
Plans call for a rail-ferry service connecting Ust-Luga to Kalinigrad a Russian area on the Baltic surrounded by other countries and to German ports. That will allow the shipment of goods into and out of Kalinigrad without entering the territory of the Baltic States.
Holcim agrees to restrict slag use in Canda
The Holcim Inc. cement plant near Three Forks has agreed to restrict its use of slag from refineries in Montana and Canada while the state completes its analysis of the industrial waste and a related environmental study
Holcim has dropped plans to burn slag imported from a Canadian lead and zinc operation and limit use of slag from the closed smelter in East Helena to 15,000 tons a year, the agency reported.
Director Richard Opper said the deal was struck after the department received test results on the slag, which Holcim uses to add iron to its cement.
Nicole Prokop, alternative materials manager for Holcim, said the company agreed to limit use of slag in recognition of the department's concerns about hazardous air pollution coming from the plant. But, as part of the agreement, the state agreed to finish work on Holcim's request for a permit to burn old tires as fuel at the plant, she noted.
Controversy over materials burned at the Holcim plant began about four years ago when the company applied for a permit to use tires as fuel.
