September, 07 2005
Global Steel Holdings ushers Indian Ispat into fold
In a major consolidation move, Global Steel Holding Ltd GSHL, the UK based company owned by Mr Pramod Mittal and Mr Vinod Mittal has taken India based Ispat Industries into its fold. GSHL, which has operations in six countries with a total steel-making capacity of 14 million tonnes, has taken over the smaller companies that formed the promoters group of Ispat Industries. GSHL now becomes the largest steel group operating in India, overtaking both SAIL and Tata Steel.
GSHL has an asset base of $10 billion and Ispat Industries, which is in the process of expanding its capacity to 3.3 million tonnes by the year end, will get a bigger financial leverage to raise funds.
GSHL is looking to raise capacity to 20 million tonnes across the globe. In the recent past, the group has grown at a scorching pace by acquiring plants in various locations. At present, it has operations in Nigeria, the Philippines, Libya, Bulgaria and Bosnia in addition to India.
Essar plans to set up 1500 MW unit in Hazira
Essar Power Ltd a part of Essar Group, has chalked out plans to setup a 1500 MW gas-based power plant at Hazira at an approximate investment of Rs. 4000 crore. Essar has achieved the full financial closure for the project, which has been put on the fast track by the Central government informed MD Mr Prashant Ruia
EPL expects to complete the first phase of 750 MW of the plant within two years of the zero date, and the balance 750MW in the subsequent 12 months.
Essar has already signed a power purchase agreement with the corporation. Essar had signed another agreement with Gujarat State Petrochemicals Corporation regarding supply of gas for the power plant.
Once the 1500 MW power plant was commissioned, power generation capacity of Essar Power would increase to over 2300MW, Prashant Ruia added. Essar already had a 515MW power plant operational at Hazira, selling 300MW to GEB and the remaining to Essar Steel. Essar is building another 355MW power plant at Hazira costing Rs 750 crore, due for commissioning by September 2006. first phase of this plant, having capacity of 100 MW, was commissioned in May 2005
Vizag to get another bulk port by 2007
The Gangavaram bulk port in Andhra Pradesh, near Visakhapatnam, floated by Dubai Ports International (DPI) and the Hyderabad based entrepreneur Mr DVS Raju, is expected to be operational by 2007 end
An agreement for financing the project has been signed by the promoters with a consortium of Indian banks led by State Bank of India and Industrial Development Bank of India for 1200 crores debt and 500 crores equity to fund 1700 crores project
Gangavaram port, with 6 bulk berths, has been projected to generate traffic of 27.4 million tonnes annually in the initial phase. The port can handle import and export of coal, iron ore and other dry bulk cargo, and can accommodate larger vessels up to 200,000 DWT.
The port company is understood to be discussing cargo commitments from the RINL, SAIL, HPCL and other ore and coal traders.
Arcelor to raise steel prices in Q4
The world's second-largest steel maker Arcelor is aiming to raise prices for steel in the fourth quarter, its chief executive officer was quoted as saying on Tuesday. "We will raise prices of our flat products by several dozen euros a tonne, or less than 10 percent, for delivery in the fourth quarter," Guy Dolle told a Belgian
The paper also reported him saying that steel stocks among clients have returned practically to normal. He expected a rise in apparent demand in the fourth quarter of this year and the first of next year. He said that they had expected stocks to return to normal by the end of the summer, and the first signs of a recovery were seen in June and July.
Taiwanese SS price remain unchanged for September
YUSCO has announced that the ex mill domestic prices for September remain unchanged, although YUSCO believed international price and raw material cost give conditions for a higher quote. The September prices are 76000-77000 NTD/ton for SS HR and 82000-83000 NTD/ton for SS CR
The company continues with production cut in September also but it is believed that after the half year stock adjustment, traders and end users are keeping low stocks and are waiting for replenishment signaling that market will spring back soon.
Another Taiwanese mill, Tang Eng has also kept ex mill prices same as August at levels of 78,000 NTD/ton (US$ 2,382) for 304 SS HR and 87,000 NTD/ton (US$2,656) for 304 SS CR.
Thirty US scrap sites in hurricane area likely heavily damaged
About 30 scrap metal processing plants and scrap yards in Louisiana, southern Mississippi and southwestern Alabama were likely to be heavily damaged by Hurricane Katrina, according to the Institute of Scrap Recycling Industries.
ISRI spokesman Mr Chuck Carr said that information on the damage and the whereabouts and health of the workers at the locations was unavailable.
ISRI has about 1,200 members involved in ferrous and non-ferrous scrap metal industry, with some involved in plastics, rubber and paper recycling.
Sumitomo Metals gets price hike for shipbuilding plate
Sumitomo Metal Industries agreed with major shipbuilders to increase the plate contract price by 5,000 yen per tonne to 60,000 yen per tonne for shipment in second half of fiscal 2005 ending March 2006
However, Sumitomo Metals will seek another hike for fiscal 2006 when the price is still lower than international price and plate prices for other applications.
Noble resources to divest in Consolidated Minerals
Consolidated Minerals Limited, a manganese, chromite and nickel miner, announced that its major shareholder, Hong Kong based Noble Resources Limited, has made a decision to divest half of its 12.4% share holding in Consolidated. MD Mr Michael Kiernan said Nobles decision to exit its holding directly reflected Consolidateds success and its strong growth to date on the back of its core steel and stainless steel related minerals businesses and they have made a decision to realize the profit on their initial investment made in 1990
He further said that the sales agency agreements and trading relationships we have with Noble as our principal sales agent into China are for life of mine and Nobles decision to sell its shares has absolutely no operational impact on Consolidated and from a marketing perspective, we will continue to have a very strong ongoing relationship with Noble
Hanbo Steel reborn as Hyundai
Korea South Chungcheong provinces Dangjin steel mill, which was purchased by affiliates of Hyundai Motor Group last year from the bankrupt Hanbo Iron & Steel Co, is finally coming back to life as INI Steel Co, a Hyundai affiliate, plans to turn Dangjin into a national steel center, with plans for an additional 7 million ton annual capacity to open by 2011 for which construction would begin in 2008.
Korea's two major steel centers are currently Pohang in North Gyeongsang province and Gwangyang in South Jeolla.
The steel facilities at Dangjin have been empty for over seven years following the Hanbo bankruptcy in 1997. In September, two affiliates of Hyundai Motor Group, INI Steel and Hyundai Hysco Co. took over the plant for 877.1 billion won ($856.4 million).
"The Dangjin plants, once fully operational, will contribute to Hyundai Motor's production by supplying premium quality steel sheets for vehicles," said Mr Lee Sang-soo, an executive at Hyundai Hysco
Coalmine explosion traps sixteen miners
Rescuers were searching for 16 workers trapped in a coalmine in northern China after a gas explosion overnight, state media reported. The accident was at the Zhike Town Coal Mine in Zhongyang county of Shanxi province when 18 miners were working underground, Xinhua news agency said. Two workers managed to escape but the rest were trapped.
The mine was operating in defiance of a government order for it to shut, the report said.
China last month ordered 7000 coalmines to suspend operations by the end of the year as deaths from accidents linked to poor safety standards soared.
But it was not clear how it could enforce the closures as many profit-driven mines soon reopen after being shut down, with local officials bribed to turn a blind eye.
China's mines are the world's deadliest with safety often sacrificed to supply the fuel that is driving the country's rapid industrialization and economic growth. China recorded about 2700 mining fatalities in the first half of the year from explosions, shaft collapses, fires and other accidents. Independent estimates say the real figure could be far higher as mines often falsify death counts to escape closures and fines.
FAS investigating iron ore price complaint of MMK
The Russia government's Federal Anti Monopoly Service FAS has informed press that it expects to complete an inquiry into possible collusion by domestic miners in supply and pricing of iron ore within the next four months. A questionnaire covering the period from January 1, 2003, to June 30, 2005, has been sent to all the major Russian iron-ore producers and the deadline for response is September 15
FAS is going to determine the degree of competition in the Russian market for iron ore raw material, the price and marketing policy of participants of the market, and connection between steelmakers and manufacturers of iron-ore raw material in the commodity market.
FAS started its inquiry after receiving a complaint from Magnitogorsk Metallurgical Combine, Russia's largest steelmaker, that it was being squeezed by alleged coordination of price increases from two iron ore combines GOKs controlled by Mr Alisher Usmanov, Lebedinsky & Mikhailovsky and an allied plant in Kazakhstan Sokolovsko - Sarbaysky.
MMK, Russia's largest steel mill, is the most dependent of the domestic steelmakers on iron ore supplies from independent mines.
Stoilensky, which is owned by Mr Vladimir Lisin's Novolipetsk Steel group, and Kachkanarsky, which is controlled by Evraz, control 13% and 9%, respectively, of the Russian ore market. Mikhailovsky and Lebedinsky control 41% of the aggregate production. While most Russian GOKs are part of major steel groups, Usmanov's group is the largest independent iron-ore producer and significantly affects the market.
Judgment today on Mittal Steel SA strike dispute
Judgment in the Labor Court in Johannesburg in the legal action between Mittal Steel South Africa and trade union Solidarity over the intended strike action by the trade union has been suspended until today, Mr Tami Didiza, Mittal Steel South Africa's General Manager of Corporate Affairs, said yesterday.
This means there will be no strike action by Solidarity members at the Vereeniging plant until the judgment is handed down by the court, Mr Didiza said.
The dispute between Mittal Steel South Africa and Solidarity was over the union's demand for more money for the working hours of 134 of its day shift members at the plant. Mittal Steel South Africa had attempted to seek a conciliatory solution and explained that the demand was against the letter and spirit of the three-year wage agreement, which bars the parties from raising issues that have financial implications, except for the annual adjustment provided for in the agreement.
Australian minerals export earnings hit record $67b
The export earnings of Australia's mines increased by almost a third to hit a record $67 billion in 2004-05, a new report says. The chief commodities forecaster, the Australian Bureau of Agricultural and Resource Economics (ABARE), said the minerals and energy sector enjoyed a 29 per cent lift in export earnings last financial year.
Coking coal recorded the biggest rise, up a whopping 65 per cent to $10.7 billion. Strong rises in export earnings were also recorded for iron ore and pellets, up 53 per cent to $8 billion, and steaming coal up 45 per cent to $6.3 billion.
"This strong performance reflects higher export prices across almost 80 per cent of all minerals and energy commodities exported, along with increased export volumes for over two thirds," ABARE executive director Brian Fisher said. "Each of these commodities recorded increases in both export prices and volumes, particularly in the June quarter, following substantial increases in contract prices from Asian steel mills and electricity generation plants," Dr Fisher said.
IPSCO reports on the effects of Hurricane Katrina
IPSCO reported today that its Mobile, Alabama Steelworks sustained minimal damage from Hurricane Katrina and returned to normal production levels within two days. However, significant damage to the Gulf region's distribution infrastructure, especially Westbound, has disrupted the normal flow of inbound and outbound freight.
Production is expected to maintain its normal output and meet established schedules for existing orders. Alternate sources of critical materials and supplies have been arranged where required. Shipment of existing orders will be filled consistent with our ability to obtain transportation from the mill.
Minor storm damage was isolated to the roof of the Company's new heat
treat facility under construction at the site. The damage is not expected to
delay completion of the facility.
Barge and rail service to the West was severely damaged by Katrina and
must be rerouted. Service to the East and North are near normal levels.
Availability of truck transportation has been affected by the shortage of fuel
and increased demand caused by the disruption of barge and rail service.
IPSCO operates steel mills at three locations and pipe mills at six locations in Canada and the United States. As a low cost North American steel producer, IPSCO has a combined annual steel making capacity of 3,500,000 tons. The Company's tubular facilities produce a wide range of tubular products including line pipe, oil and gas well casing and tubing, standard pipe and hollow structural, for a combined annual capacity of 1,775,000 tons.
Nigerian President orders probe of himself for Ajaokuta
The countrys is to investigate in connection with corruption following accusations by a state governor.
President Mr Olusegun Obasanjo states anti fraud agency to a probe of himself and other top officials after Mr Orji Kalu, governor of south eastern Abia state, accused them of receiving bribes for oil contracts and privatizations, and operating illegal foreign bank accounts.
Mr Kalu has accused Mr Obasanjo of taking bribes in the recent privatization of two steel mills at Ajaokuta and Aladja
Stelco wins court approval to sell Stelpipe plant
An Ontario court has approved Stelco Incs plan to sell its pipe plant, Stelpipe Ltd., to Romspen Investment Corp., the steelmaker said on Tuesday.
Romspen, an independent non-bank lender, will continue Stelpipe's operations in its Welland, Ontario, facility through a new, wholly owned subsidiary, Lakeside Steel Corp. It will retain almost all the plant's employees, Stelco said.
Stelco, which has operated under court protection from creditors since January 2004, said it will assume the entire pension and benefit obligations of Stelpipes retirees.
The transaction is expected to close around the end of October.
Xstrata takeover of Falconbridge likely
The move by Swiss miner Xstrata to acquire 20% of Falconbridge likely could lead to a 100% takeover of the Canadian base metals company, according to industry analysts.
Xstrata CEO Mr Mick Davis "is intent on growing Xstrata and he sees value in Falconbridge, he sees value in the nickel industry. That's why he's doing it," said Mr Damien Hackett, metals analyst with Cannacord Capital. "I have no doubt that he will finish up owning 100% of the company," he added. strata's track record of growth through acquisition is solid and disciplined, Hackett continued, citing takeovers and bids in Australia. "Mick Davis is on a very aggressive growth strategy for the company via acquisition rather than through organic growth," he explained.
Analyst Mr John Meyer of Numis Securities agreed in part, saying Xstrata's purchases of Falconbridge shares could be "with a view to taking over the whole company at some future point in time, and perhaps at a cheaper level." n addition, Meyer sees the possibility that Xstrata may be looking to resell its Falconbridge stake in the future, using it to "package the company up" and make it more attractive for eventual Chinese buyers. Chinese investors have been eyeing resource companies of late in a move to ensure raw material supplies for the Asian country's booming economy.
Xstrata declined to comment on whether it intends to make a takeover bid for the Toronto-based company. "What we would like to do with our holding is to equity account it, instead of holding onto the minority interest in our accounts," a company spokesperson said regarding the rationale for its most recent share purchase.
Xstrata processes coal, alloys, copper and zinc in the Americas, Europe, Africa and Australia, and has 50% of the Alumbrera copper-gold mine in northwest Argentina, an interest it acquired by taking over Australia's MIM in June 2003 for US$2.3bn.
Malaysian Lion Group to invest additional RM5.0 Bln
Lion Group, which has invested about RM5.6 billion in the steel industry so far, expects to invest an additional RM5.0 billion in several steel-related projects to improve productivity and efficiency, its chairman Mr Tan Sri William Cheng said Tuesday. He said the Lion Group hoped to be among the 10 most efficient steel producers in the world with the completion of their proposed steel-related projects within five years. He said the additional investment in the projects would also raise their total production capacity to 7.8 million tonnes per annum.
Some of the proposed projects are the construction of the new Banting Bridge, DRI plant, power plant and blast furnace. The proposed DRI plant would have the capacity to produce 1.54 million tonnes per annum of DRI
They would also invest some RM1.2 billion on blast furnace project to reduce its steel production cost and improve production yield. The proposed power plant with an investment of about RM1.6 billion would use waste gas from the blast furnace and natural gas to generate power required in the steelmaking projects
Fortescue's Chinese whispers
Fortescue Metals shares rocketed on rumors that CEO Mr Andrew Forrest had finally snared a partner for the group's $2.3 billion iron ore project in the Pilbara region of Western Australia. Chinese giant Sinosteel has been "whispered" as a possible project partner. Fortescue confirmed Sinosteel had expressed interest but said it was also in discussions with other international steel companies.
Pressure is mounting for Fortescue to secure a partner if it is to maintain its schedule of starting to ship ore by late 2007 or early 2008 but Fortescue must finalize a Native title agreement before it begins mining. The Nyiyaparli people have asked the Federal Court to void an agreement signed last month, claiming it was made under duress and without lawyers present.
Rotem to export steel press to Kia's Slovakian plant
Rotem Co., a rolling stock manufacturer under Hyundai Automotive Group, said yesterday it developed a 5,400-metric-ton mechanical press which will be used at affiliate Kia Motors Corp.'s Slovakian plant. With the press machine capable of producing steel panels for 300,000 cars per year, Rotem plans to challenge the market currently halved by German and Japanese makers, the company said.
Kia Motor Slovakia production plant with an annual production capacity of 300,000 cars is scheduled to open next year.
Rotem plans to export the machine, with the world's highest production
speed of 15 panels per minute, to North America as well as Europe. Rotem's plant and machinery division has manufactured and supplied 3,000-ton mechanical presses since last year.
Rotem was initially formed as a state-run company in 1999 after rolling stock affiliates of Hyundai, Daewoo, and Hanjin groups were merged. The company currently makes numerous rolling stocks like diesel-electric locomotives at its Changwon plant in South Gyeongsang Province. It also has a defense division that produces armored vehicles for the Korean military
Falconbridge discovers significant Nickel deposits in Brazil
Falconbridge Limited's wholly owned Brazilian subsidiary, Falconbridge Brazil Ltda., today announced that it has discovered two new significant nickel deposits on its Araguaia Nickel Laterite properties in the Para State of northern Brazil. An extensive exploration program on these promising properties is being conducted by the Company.
These are completely new grassroots discoveries in an area where the first recorded drilling for base metals was completed by Falconbridge's exploration team in October of 2004. The deposits occur on properties owned by Falconbridge or where Falconbridge has the right to earn a 100% interest, by completing a series of cash payments totaling US$2.4 million staged over eight years.
Liberian government hearing for Mittal Steel under review
The controversial Mittal Steel Agreement which is currently undergoing scrutiny for possible ratification by members of the National Transitional Legislative Assembly NTLA in Liberia has been described illegal by scores of lawmakers and other professional Liberians.
Lands and Mines Committee has also suggested that all further negotiations between the government of Liberia and Mittal Steel be halted pending the final judgment into GIHL complain against the NTGL.
The executive manager of Mittal Steel Mr Frank Pannier told his audience that his company will invest US$900 million for twenty five years and in addition to this the entity will provide community empowerment venture that will help Liberians the best way forward. He said his company will provide electricity, medication as well as schools in communities; this exercise he told reporters will be the company's own way of making Liberians part of global development.
Anglo 'on track' with Kumba deal
Anglo American is getting closer to finalizing an empowerment transaction at Kumba and is also making good progress on an empowerment deal for De Beers Consolidated Mines, CEO of Anglo American's South African operations Lazarus Zim says.
There has been widespread speculation recently that Kumba, which is 66% held by Anglo, could split its iron ore and coal assets into separate listings and bring in Eyesizwe Mining as a partner in the base metals and coal company.
Cardero announces Pampa de Pongo resource of 953 ml of iron ore
Cardero Resource Corp has announced the completion of an independent NI 43-101 compliant mineral resource estimate at its 100% owned Pampa de Pongo Iron Deposit, southern Peru.
The independent resource estimate concluded that the Pampa de Pongo deposit contains an Inferred Resource of approximately 953 million tonnes averaging 44.7% Fe, 0.12% Cu, 0.09 g/t Au based on the results of the 2004-2005 drill campaign, 3D magnetic modeling as well as prior drill results obtained by Rio Tinto plc.
Atlas increases Pilbara iron ore ground position
Atlas Gold Ltd has reached agreement with Independence Group NL (IGO) and their joint venture partners CO2 Group Limited (CO2) to earn 100% of the iron ore rights on tenements immediately adjoining Atlas' highly prospective Pardoo Iron Ore Project in Western Australia.
The tenements, totaling 490sqkm, host the South Limb Iron Ore Prospect and significantly increase Atlas' tenement interests in the region between Pardoo and the BHP Billiton owned Goldsworthy Iron Ore Project.
Goldsworthy has produced in excess of 50 million tonnes of 63% grade iron ore valued in excess of $2 billion dollars since commencing production.
Atlas' Managing Director, David Flanagan, commented: "It is pleasing to have entered into an agreement with a highly successful mining company such as the Independence Group. We intend to move quickly to assess the economic potential of this new ground as we continue to build on our already pleasing initial drilling results from Pardoo"
As part of the agreement with IGO/CO2, Atlas will commence development within 4 years to earn 100% of the iron ore rights. Initial work will focus on the South Limb prospect, located in close proximity to Atlas other iron ore prospects.
Grande Cache Coal Corporation announces new VP Finance & CFO
Grande Cache Coal Corporation has announced the appointment of Ms Anita L. Roncin as Vice President, Finance and Chief Financial Officer effective October 1, 2005. Ms Roncin currently serves as Controller of Grande Cache Coal Corporation. Anita Roncin will replace Mr Thomas E. Pierce, who will be leaving the Corporation to pursue other interests.
Ms. Roncin is a Chartered Accountant and holds a Bachelor of Commerce degree from the University of Saskatchewan. Prior to joining Grande Cache Coal, she worked for another major Canadian coal producer and has experience with a large accounting firm.
Grande Cache Coal is an Alberta based metallurgical coal mining company whose experienced team of coal professionals are developing a long-term mining operation to produce metallurgical coal for the export market from Grande Cache Coal's coal leases covering over 15,000 hectares in the Smoky River Coalfield located in west-central Alberta.
US Magnesium Steel union holds work stoppage
Members of the United Steel Workers called a work stoppage Saturday at U.S. Magnesium's Tooele County plant. Union members rejected a proposal from the company for a new collective bargaining agreement on Thursday and Friday.
According to a written news release from United Steel Workers Local 8319, employees expressed anger over health-care premium increases and insufficient minimal wage increases, which would more than be negated by the ever-increasing health care costs. The Union has received a tentative agreement with U.S. Magnesium to engage in mediation through a federal mediator this week.
Nigerian steel workers seek payments as per their entitlements
AS government finally divests from the Iron and Steel industry, marooned workers of the sector have appealed for the settlement of their outstanding entitlements. With the three inland rolling mills liquidated and the two steel companies leased for at least 10 years to Indian firms, the workers lamented that some of their emolument including salaries of between January and March 2005 have remained unpaid as the concessionaire began payment of salaries of the remaining workers as from April in line with agreements signed with government with respect to Ajaokuta and Aladja Steel Companies.
The workers under the banners of Steel and Engineering Workers Union of Nigeria (SEWUN) and Iron and Steel Senior Staff Association of Nigeria (ISSAN) have jointly demanded from the Ajaokuta Steel Company Limited (ASCL), the Ministry of Power and Steel, the reconstitution of new Board of Trustee for the ASCL, Pension Scheme and appointment of a fund manager to handle the scheme administration.
The nation's Iron and Steel industry has been in a quandary over the years as all the nine companies, agencies and research institutes owned by government in the sector never realized their full potentials despite huge sums expended to develop them.
Zamil Steel builds second plant in Vietnam
Zamil Steel Co. on September 6 started work on it second plant in Vietnam with a designed annual output of 24,000 tons of structural steel.
The new project has boosted the Saudi Arabia-headquartered companys investment capital in Vietnam to US$40 million.
The second plant is located in Amata Industrial Park in southern Dong Nai province with the first being in Hanoi.
