May, 25 2006
TATA Steel on overseas acquisition drive
TATA Steel is looking at acquiring steel plants in the US, Europe, South Africa and South East Asian regions. TATA Steel has already acquired Nat Steel & Millennium in last one year.
Dr T Mukherjee deputy MD of Steel said "Other companies are seeing so they have started talking to us, to come and have a look at our plant. We are also interested so we are short listing those companies, which will fit into our way of thinking."
He added that "There are great opportunities in US & Europe, as Mittal Steel has proved by opting for or making an offer for Arcelor. So there are many companies in that area. Most companies can have a better future with a company that has got good steel making facilities."
In South Africa, too, TATA Steel is pursuing an acquisition possibility of Highveld through a consortium.
PSL to set up pipe plant in UAE to save on freight costs
PSL Ltd plans to set up a wholly owned manufacturing and coating unit at Hamriyah Free Trade Zone in the UAE by investing $15 million to save on the freight cost of exporting pipes from India and improve margins on orders from the Middle East. The unit with an initial capacity of 75,000 tonnes per year would be built by the first quarter of 2007.
Mr Ashok Punj MD told during an interview "We are getting enquiries from several countries in that region. This plant would cater to markets in Sudan, Qatar, Saudi Arabia, Kuwait and Oman." Mr Punj said that the company also planned to expand into North Africa, Bangladesh and Vietnam after the UAE project.
Praxair India gets gas plant contract from TATA Steel
Praxair India announced the award of a major contract from TATA Steel to build and operate two on site industrial gas plants at the site of their steel plant at Jamshedpur. These plants will be commissioned by early 2008 well in time for the ongoing 1.8 million ton expansion TATA steel at Jamshedpur.
Praxair India will build, own and operate two state of the art cryogenic air separation plants, each with a capacity of 700 metric tons per day to meet Tata Steel's gas requirements. In addition to meeting Tata Steel's oxygen, nitrogen and argon requirements, these plants may also meet the growing demand for liquid gases from customers in eastern and northern India.
Dr T Mukherjee deputy MD Steel of TATA Steel said "We have confidence that Praxair will once again meet the quality and reliability expectations of Tata Steel, in the supply of cryogenic gases required to meet the capacity expansions called for in our corporate plan."
In October 2005, Praxair commissioned an 875 MTPD plant at Jamshedpur to supply TATA Steel's needs.
Coal drives Indias mineral production growth in March 2006
The mineral production from mining and quarrying sector in March 2006 was higher by 13.2% as compared to February 2006 and marginal increase was recorded as compared to March 2005. The total value of mineral production excluding atomic & minor minerals in the country during the month was Rs.7031 crore.
The contribution of coal was the highest at Rs3229 crore at 46%. Iron ore accounted for Rs.722 crore, lignite Rs.201 crore and limestone Rs.163 crore.
L&T enters hydroelectric power projects
Larsen & Toubro Ltd has announced that the Company has bagged the development rights for a 60 MW Singoli Bhatwari Hydroelectric Power Project in Rudraprayag district of Uttaranchal on Mandakini River, a tributary of the Ganga, from the Government of Uttaranchal.
Valued at around Rs 5,000 million, this project will be executed by the Company on Build Own Operate and Transfer basis for a concession period of 45 years. The project involves design and construction of a 20 meter high and 80 meter long barrage, 12 kilometers long headrace tunnel, surface powerhouse, substation and a 12 kilometers long 132 KV transmission line. Francis turbines will be used to generate 361 million units of energy in a year with 90% rain fall.
Though L&T has to its credit engineering and construction of many power, infrastructure and industrial projects and BOT variants, this will be the Company's maiden hydroelectric project via the Public Private Partnership model. Mr KV Rangaswami ED & Head of the Construction Division of L&T said, "Hydro projects would be one of the thrust areas for L&T, and such projects give us the opportunity for taking up challenging construction and engineering works. We are also evaluating similar project opportunities in other states".
Thermex reports surge in profits for 2005-06
Thermax Ltd has posted a net profit after tax of Rs 419.70 million for the quarter ended March 31, 2006 as against Rs 261.90 million for Q4 of 2004-05. Total Income is Rs 4800.60 million for Q4 of 2005-06as against Rs 3474.20 million in Q4 of 2004-05.
Thermex has posted a net profit after tax of Rs 1232.50 million for the 2005-06 as against Rs 552.90 million for 2004-05. Total Income is Rs 14980.00 million for 2005-06 as against Rs 9411.60 million in 2004-05.
GAIL to implement Assam Gas Cracker Project
Gail India Ltd has announced that with the recent approval of the Cabinet Committee on Economic Affairs, its Joint Venture Company will implement Assam Gas Cracker Project at an investment of Rs 54606.10 million at integrated Petrochemical Complex at Lepetkata, District Dibrugath.
It shall be implemented by a Joint Venture Company to be promoted by the Company with 70% equity participation. The remaining 30% equity will be shared equally among OIL, NRL and Govt of Assam. The project will be completed in 60 months from the date of approval.
CVRD seals 19% iron ore price hike with Arcelor
Mr Barbosa CVRD's Financial Director told reporters European steel producer Arcelor had agreed to a 19% increase in the 2006 contract price, following similar agreements last week with Mittal Steel and other major producers in Germany, Italy, Japan, Taiwan and South Korea
CVRD said that its biggest customer China would have to pay the same 19% price hike agreed by other steelmakers adding that talks were continuing with Chinese steelmakers, who are fighting for a maximum 12.5% price rise in 2006. Mr Fabio Barbosa said "We have concluded deals with nearly all the European steel makers and we're making progress in China. We're not making and won't make any different iron ore prices."
Metal analysts expect Chinese steel makers to accept the 19% price rise which in Asia would apply retroactively from April 1 and in Europe from January 1.
PSMC Privatization Supreme Court suspends sale
Pakistans Supreme Court issued an interim order on Tuesday halting the sale of Pakistan Steel Mills to MMK, Al Tuwairqi and Arif Securities consortium until June 15.It also directed the PSMC chairman to continue normal production while it hears a petition challenging the privatization on the grounds that it is unconstitutional and the price paid by the consortium is too low. The court adjourned the hearing till June 15.
The court passed the interim orders on a constitutional petition filed by Watan Party President Mr Hashim Shaukat Khan under Article 184(3) of the Constitution. The PSM employees union has also filed a petition to become a party in this case. The court was about to issue a formal stay order but the respondents the Privatization Commission, PSMC and the consortium agreed not to transfer possession till June 15. It may be recalled that all the matters of the mills were to be handed over the bidder on May, 29.
A consortium of MMK Arif Habib Securities Limited and Al Tuwairqi group bought a 75% stake in the PSMC at a cost of Rs 21.68 billion in an auction.
Baosteel & Shaoguan JV for 20 million tonne plant in Guangdong
A HK based Ta Kung Pao newspaper, quoting a reliable source, has reported that the Guangdong's Zhanjiang municipal government has signed an agreement with Bao Steel and Shaoguan Iran & Steel Group for building one of the China's largest iron and steel plant. No party involved in the deal has publicly disclosed details of the agreement, including the investment involved and the project's timescale.
According to the report the JV will have a registered capital of 20 billion yuan ($2.5 billion), total investment of 140 billion yuan ($17.5 billion) and an initial investment of 70 billion yuan ($8.8 billion). Initial production capacity will be 10 million tons of steel for the automobile and consumer electronic industries. The project will have an annual production capacity of 20 million tons when fully operational.
Guangdong's annual production capacity of iron and steel stands at 7 million tons at present, although its annual consumption is 28 million tons.
BHP welcomes decision on Mt Newman Rail Line
BHP Billiton welcomed the decision by the Federal Treasurer, the Hon. Peter Costello MP, to effectively reject a recommendation by the National Competition Council to declare open access to the companys Mt Newman railway tracks.
BHP Billiton CEO Mr Chip Goodyear said that the decision reflected recommendations from the Hilmer Committee and the Prime Minister's Export Infrastructure Taskforce that access declarations be applied sparingly and in carefully limited circumstance.
Mr Goodyear said BHP Billiton has invested more than $2 billion developing our rail line in conjunction with our mine and port operations, as a technologically sophisticated and integrated production process. This investment has been supported by our more than 350,000 shareholders and the millions of people standing behind the superannuation funds. Their support is critical as we look for additional opportunities to expand our activities further. This decision should help in continuing to retain their support, while also helping to ensure the ongoing integrity and reliability of the system.
Mr Goodyear said that if any appeal was lodged, the company would continue to vigorously defend its position. He said In the case of an appeal, we are confident that the ultimate outcome will be determined in accordance with Australia's best interests. That is, the railway line will not be declared.
Glencore buys Asarco's Tennessee zinc mines
Switzerland based Glencore has purchased Asarco's Tennessee Mines Division at auction from US Bankruptcy Court for the Southern District of Texas. According to court documents, the minimum purchase price would have been $40 million, although, since the sale was an auction, the final price could have been higher.
The assets of the Tennessee Mines Division include the Young and Coy underground zinc mines and the 7,600 st/day Young mill in Jefferson County, Tennessee and the Immel underground zinc mine in Knox County, Tennessee.
Operations at these units were suspended in November 2001. Asarco filled for Chapter 11 bankruptcy August 9, 2005.
Portman MD says that benchmark price established even for China
Iron ore miner Portman Ltd said that the outcome of recent price negotiations for the metal with several steel mills in Japan, Taiwan and Germany has established the benchmark price and Chinese mills should agree to a similar price.
Mr Richard Mehan MD of Portland said that once a benchmark iron ore price was established history showed it was accepted by the entire industry. He said "If history is a guide and I'm not going to say history is always exactly right for the future but it's clear that a benchmark has been established." Mr Mehan noted a discrepancy in the benchmark price settled between the major miners and the Asian markets had never occurred. Mr Mehan said that "We are not at the table in China so I don't know what the issues are that would stop that benchmark price transferring over to China, other than what the Chinese have said about their desire to have cheaper iron ore than the 19%."
Portman, which is 80% owned by US based Cleveland Cliffs, sells the majority of its iron ore from its two West Australian operations to China under contracts set to the benchmark price. Portman recently completed an expansion at its main Koolyanobbing operation which now produces six million tonnes of ore a year. The company also mines iron ore at the smaller Cockatoo Island mine.
POSCO buying 40% of Prestar subsidiary Posmimit
POSCOs Steel Service & Sales Co Ltd is acquiring a 37.86% stake in Prestar Resources Bhd's subsidiary Posmmit Steel Centre Sdn Bhd. POSCO is acquiring or 2.14% in Possmit from Spur Reach Sdn Bhd under a separate agreement.
Prestar said that The transaction amount will determined later after the completion of the due diligence review of the assets and liabilities of Posmmit. An agreement is expected to be executed between the parties within 30 days after the completion of a due diligence review and to close the transaction not later than September 30.
Prestar said POSCO was acquiring the stake in Possmit under its business expansion plan. As for Prestar, it was its strategy to move up the value chain of the steel industry. Prestar owns a 68% stake in Posmmit.
Russias coal production up by 11.2% in April
Russia increased coal production 11.2% YOY in April to 26.12 million tonnes. The country has produced 105.89 million tonnes of coal during January to April.
Industry and Energy Ministry said that 67% of the coal was mined in the Kuznetsk and Kansk-Achinsk coal basins, where output rose by 3.8% and 15.8% respectively during January to April. Production in the Pechora basin was unchanged and production in the Russian part of the Donets Basin fell by 7%.
Russian coal export increased by 2.6% YOY during January to April 2006. Domestic market sales increased by 5.6% to 70.8 million tonnes including growth of 7.6% to 34.5 million tonnes to power stations and 7.3% to 12.9 million tonnes to steel mills. Sales to households, utility providers and farms fell 2.8% to 9.8 million tonnes.
Aleris to buy Corus downstream aluminium unit
Aluminum major Aleris International Inc said that it has agreed to acquire the downstream aluminum business of Corus Group plc, after signing a letter of intent in March to buy the operation. Aleris will pay 700 million euros cash ($899.7 million) for the business and assume about 28 million euros ($36 million) in debt and certain other liabilities. The transaction is scheduled to close in the third quarter, subject to regulatory approvals.
The purchase includes Corus' aluminum rolling and extrusion businesses but excludes Corus's primary aluminum smelters.
Following completion of the proposed transaction, Aleris, which makes rolled aluminum products and specification alloys, will have about 8,800 employees and operate 51 manufacturing plants in North America, South America, Europe and Asia.
US Senate passes bill to improve safety at coal mines
US Senate voted on Wednesday on measures required for safety upgrades at underground coal mines. The measure would require coal mine operators to keep more emergency air supplies underground and to better seal off abandoned sections of mines. The Bush administration has expressed support for the measure. The last time Congress passed legislation overhauling mine safety laws was in 1977 following fatal mine accidents in Kentucky.
The bill, which was approved on a voice vote, would require miners to have at least two hours of oxygen available instead of one as under the current policy. It also would require mine operators to store extra oxygen packs along escape routes and to perform checks on the devices to ensure they work. The mine agency recently issued a temporary rule requiring coal operators to give miners extra oxygen, but miners have been pressing Congress to enact a permanent solution.
The Senate bill also would require the strengthening of seals for abandoned sections of mines. Traditionally, concrete blocks have been used as seals, but nontraditional materials also have been allowed since the 1990s.
The United Mine Workers of America and the industry-backed National Mining Association have endorsed the Senate bill. United Mine Workers of America President Mr Cecil Roberts said "This legislation is a step in the right direction and I urge the House to pass it as soon as possible and President Mr Bush to sign it into law without delay."
In all, 33 coal miners have been killed on the job so far this year in US. The fatality rate is up from 22 coal miners killed throughout all of 2005.
DMZ earnings in 2005 tumble by 90%
Ukraines The Donetsk Metallurgical Plant has reported that its net profit in 2005 dipped by 91.2% YOY to 7.62 million hryvni. The sales in 2005 also reduced to 1.39 billion hryvni from 1.89 billion hryvni in 2004.
Pretax profit fell by 78.4% YOY to 28.08 million hryvni.
Coal mine gas explosion kills 8 in Henan province
Eight miners have been killed in a gas explosion at a coal mine in central China's Henan Province. The accident took place at Siyuangou Village near Chencun Town of Mianchi County at 9:00 PM on Monday, killing the 8 miners and trapping others.
The unlicensed coal mine, which had been shut down by local government, restarted operation at 7PM on Monday without any approval from authorities
Rescue work is in full swing, according to the officials.
Brazils crude steel production in April hit by BF closure at CSN
Brazilian Steelworks Institute has attributed the 12.4% YOY drop in the production in April to 2.41 million tonnes in Brazil to the stoppage of blast furnace at CSN and said that if this isn't considered, the production rhythm observed is the same as last year.
The 9.6 million tons production of crude steel in Brazil during January to April of 2006 also dropped by 10.2% as against 10.6 million tons in the corresponding period of 2005.
Sales to the domestic market increased by 2.6% in April. According to the IBS, the increase in 7.9% in domestic sales of long products confirms the firm demand from construction segment. Exports dropped by 6.6% YOY overall mainly due to 38.5% YOY drop in long products.
Regulators start review of new Mittal Steels revised offer
Reuters have reported that financial regulators have received documents related to Mittal Steel's improved bid for Arcelor and should be able to approve them within the next two weeks. The revised bid, which would serve as a supplement to the original offer document, arrived at regulators late on Tuesday, a source told Reuters.
Regulators in Luxembourg, France, Belgium and Spain, where Arcelor is listed, need to approve Mittal's improved offer for it to be put to Arcelor's shareholders. The regulators themselves declined to comment.
Gerdau to hold long product market share in Brazil
Brazilian long steel producer Gerdau does not plan to give up its domestic market share even if Mittal Steel acquires Arcelor. Gerdau investor relations director Mr Osvaldo Schirmer said in a web cast "We see this possible acquisition of Arcelor as a natural step and that Gerdau is analyzing acquisition opportunities outside Brazil.
Gerdau has crude steel output capacity in Brazil of 9 million tonnes and Arcelor Brasil has installed output capacity of 11 million tonnes of long and flat steel. In addition to Brazil, Gerdau operates in Argentina, Canada, Chile, Colombia, Uruguay, the US and Spain.
Mr Alexei Miller reelected as Gazprom CEO for five years
Mr Alexei Miller has been reelected as the CEO of Gazprom for another five years. Russian energy giant said "The five year contract will come into force on May 31, 2006."
A former deputy energy minister, Mr Miller was first elected Gazprom CEO on April 30, 2001, replacing Mr Rem Vyakhirev.
Vietnams Danang steel plant closed due to pollution
Danang Steel Plant in Lien Chieu Industrial Park, the largest steel mill in central Vietnams Danang city, has been shut down pending repairs to its pollution treatment system after widespread complaints in the vicinity about iron dust pollution.
A municipal inter department task force tool had inspected the plant after receiving pollution complaints from hundreds of households around the park. The inspection showed the plants iron dust emission rate was 7.6 times higher than permitted.
It will be allowed to reopen after it fixes the pollution system and gets approval the city natural resources and environment department.
1 coal miner killed at ICGs Sycamore II mine
A miner was killed Wednesday in an equipment accident underground at 2:4 PM in an International Coal Groups Sycamore II mine near Jarvisville in Harrison County. The mine is owned by ICG's Wolf Run Mining Co. Mr Charles Snavely ICG VP said that Mr Todd Upton, an underground scoop operator, apparently was struck in the head by a wooden board and was pronounced dead at the mine portal area.
The Sycamore mine is about 56 miles from ICG's Sago Mine, where 12 miners were killed in January. Sycamore produced 13,188 tons of coal and employed an average of 28 people last year last year.
The federal Mine Safety and Health Administration have cited the Sycamore mine 49 times since January. The violations range from having the proper guards on machinery to controlling coal dust. The company has been assessed $4,494 in federal penalties since 2005 and has paid $1,520.
ICG controls 916 million tons of coal reserves and has 11 mining complexes in Kentucky, West Virginia, Maryland, Virginia and Illinois. ICG President Mr Ben Hatfield has said the company's total production could hit 24 million tons by 2007, with two new underground mines near Beckley and Grafton expected to contribute to those numbers.
Strike Resources to acquire 51% of Peruvian iron ore projects
Perth headquartered explorer Strike Resources Ltd announced that it has entered into a binding agreement to acquire up to 51% interest in two related iron ore projects. The Apurimac project and the Cuzco project are located in Peru with Strike acquiring an interest in the two projects from Minera los Andes y el Pacifico SA. The Agreement with MAPSA is subject to completion of satisfactory due diligence by Strike.
Based upon a report issued by the Peruvian Ministry of Energy and Mines, the Apurimac Deposits estimated deposit size is of 730 million tonnes of high grade hematite and magnetite iron ore with Fe range of 60% to 66%, silica 2 to 5% and alumina 0.2% to 0.8% in 9 mining tenements having a total area of 7388 hectares.
The Cuzco Deposits estimated deposit size is of 500 million tonnes of high grade iron ore, principally magnetite with Fe 64% plus, phosphorus 0.09%, silica 5.06% and Sulphur content of 0.3% in 5 mining tenements having a total area of 4526.17 hectares.
Baosteel may cut stainless steel production if nickel surges
Shanghai Baoshan Iron and Steel Corp, Chinas second largest stainless steel maker, may be forced to cut stainless steel output if the price of nickel continues to rise in the next few months.
Mr Ding Qiang, a senior official with Baosteel Group's raw material purchasing department told Interfax "Baosteel was offered lower nickel prices compared to the current spot price and based on the current stainless steel price, the company can mostly afford the price. But if the price of nickel rises much higher in the next few months Baosteel could be forced to cut down production of stainless steel.
He added that "The nickel price on the LME is at a peak level now, which is completely out of sync with fundamental demand and supply, but is decided by fund speculation."
Interpipe's Dniprospetsstal earnings dip by 63% in 2005
The Dniprospetsstal steel works in Zaporizhiya Ukraine has reported that the net profit of 32.91 million hryvni in of 2005 has reduced by 63.4% over 2004. Net sales revenue grew by 39.4% to 2.26 billion hryvni, while pretax profit fell by 24.5% to 77.2 million hryvni.
Crude steel output in 2005 rose by 0.8% YOY to 506,000 tonnes and finished steel production increased by 4.1% YOY to 308,000 tonnes.
The Interpipe Group controlled Dniprospetsstal is Ukraine's only producer of special steel sections, bars and forged products. It produces stainless steel, ball bearing steel, corrosion resistant steel, high speed steel and nickel based heat resistant alloys.
Northwest Pipe to get large dia pipes order for North Texas
Northwest Pipe Company has announced that Allen / Plano / Fisco / McKinney Water Transmission Main has chosen it to supply large diameter steel pipes for the North Texas Municipal Water District.
Northwest Pipe is likely to receive a $7 million worth order for supply of 32,000 feet of 72 inch diameter steel pipe. The pipe is expected to be manufactured in the Company's Saginaw, Texas, division with delivery scheduled to begin in the third quarter of 2006.
Northwest Pipe Company manufactures welded steel pipe in three business segments. Its Water Transmission Group is a leading supplier of large diameter, high pressure steel pipe products that are used primarily for water transmission. Its Tubular Products Group manufactures smaller diameter steel pipe for a wide range of construction, agricultural, energy, industrial and mechanical applications. Its Fabricated Products Group manufactures propane tanks and other fabricated products. The Company is headquartered in Portland Oregon and has nine manufacturing facilities across the United States and Mexico.
