SAIL & RINL seek partnership in Coal Videsh Limited

It is reported that the ministry of steel has sent a proposal to the coal ministry for allotting a sizable equity stake of Steel Authority of India Limited and Rashtriya Ispat Nigam Limited in Coal India Limiteds overseas arm Coal Videsh Limited to facilitate overseas acquisitions of coking coal mines. The report said that ministry of steel is in favor of equal participation for SAIL-RINL by putting together 50% stake in CVL either as a direct equity or stake in CILs SPV.

Coal ministry has already floated a cabinet note for seeking views of different ministries over its proposal to set up CVL. A final note is likely to be sent soon to the cabinet in this respect. Coal ministry wants CVL to be set up as CILs subsidiary while the finance ministry has favored CIL to float special purpose vehicles for making acquisitions abroad.

The total import of coking coal into India is estimated to be more than 20 million tonnes. SAIL is expected to import 11.5 million tonnes of coking coal in 2006-07 and RINL about 3 million tonnes. Their requirement is likely to increase further as both the companies plan to double steel capacity in the next few years.

Expert committees favor autonomous coal price regulator

ET has reported that the coal ministry has initiated discussions to set up an autonomous body of experts that will replace the government committee which now determine coal prices for different user industries. The regulator is expected to help in improving exploitation and allocation of available resources, regulate pricing of coal under e-auction and enable a competitive coal market to emerge for user industries.

According to reports the move for an independent regulator for the sector gained momentum after two expert committees on coal sector reforms headed by Mr TL Sankar and Planning Commission expert group on integrated energy policy headed by Mr Kirit Parikh favored independent regulation of domestic coal prices.

The Parikh Committee, which is likely to finalize its report on Integrated Energy Policy this month, has proposed that that 20% of total coal production should be brought under e-auction and remaining coal should be sold through a fuel supply and transport agreement with power sector for 100% of its requirement. Other consumers should be allowed partial FSTA, leaving them to meet the shortfall through e-auction and imports. Pithead price of coal under FSTA should be revised annually by the coal regulator based on a formula that reflects prices obtained through e-auction, FOB price of imported coal and production cost, the committee has said.

At present, coal prices are fixed by the coal ministry in consultation with coal miners Coal India Limited and Singareni Collieries Company. Prices are determined on the basis of costs incurred in coal production from different mines in a coal company plus a reasonable amount of profit. However, this method is considered grossly inadequate in the present context and results in coal prices not reflecting market realities.

Indian Railways may divest stake in Ircon & RITES

Business Line has reported that Indian Railways may partially divest its stake in wholly owned Ircon International and Rail India Technical and Economic Services to raise funds for the proposed dedicated freight corridor project and it has sought the views of Ircon & RITES on the matter. The only Railway PSU to have been divested so far is Container Corporation of India, which was divested in 1998-99.

There was a move to divest RITES and Ircon by the Disinvestment Ministry in 2002 which was stalled by the then Railway Minister Mr Nitish Kumar.

RITES is a consulting organization of Indian Railway with expertise in transport, infrastructure and related technologies. RITES has recorded a net profit of Rs 24.25 crore in Q1 of 2006 up by 142% YOY with quarterly turnover of Rs 125 crore up by 180% YOY.

Ircon is the construction arm with expertise in rail track, civil, electronic and signaling construction. Ircon has recorded a net profit of Rs 17.78 crores in Q1 of 2006 up by 24% YOY with quarterly turnover of Rs 28.9 crore up by 52% YOY.

TATA Steel pledges to take care of displace people

After the unpleasant incident of violence at TATA Steels steel plant site at Kalinga Nagar in Orissa, TATA Steel has decided to take total responsibility of people displaced by its projects.

Mr B Muthuraman MD of TATA Steel said that the company would ensure that all those displaced in Jharkhand, Orissa and Chhattisgarh are made a part of the Tata Steel family. He promised that the company would see to it that adequate compensation is given to them, jobs are provided to a member from every family and above all TATA Steel would keep track of their earnings.

TATA Steel is setting up Greenfield projects in Orissas Kalinga Nagar for 6 million tonnes, Chhattisgarhs Jagdalpur for 5 million tonnes and Tontoposhi in Jharkhand for 10 million tonnes.

TATA Steel to buy coal & manganese mines in S Africa

The Business Standard citing Mr P Roy executive in charge of ferro alloys and minerals of TATA Steel has reported that TATA Steel is planning to buy two to three manganese blocks as well as an unspecified number of coal mines in South Africa.

The report said that TATA Steel may acquire the assets together with a South African partner without naming the likely companies or the projected value of the investments.

Samancor, Assmang, Vanadium and Highveld Steel dominate the South African manganese production. Around 40% of the production is exported to ferro alloy producers while the remaining is converted to alloys and manganese metal which are then exported.

The report also said that TATA Steel already has ferro chrome mines in the country without saying where they were.

Domestic steel makers to face fierce competition

Indian government has said that with the reduction in import duty, steel imports have increased, resulting in domestic steel utilities facing competition from the global steel giants.

Mr Ram Vilas Paswan union minister of steel informed Lok Sabha that "With the reduction in import duty, steel imports have increased, resulting in competition with the global steel companies. Also with the proposed entry of international players like Posco and Mittal Steel, competition would be fiercer, especially in the light of the state of art technology available with such new entrants."

He said that SAIL has announced its corporate plan 2012, which envisaged enhancing capacity and building competitiveness for maintaining leadership in the domestic steel market. The plan envisaged a growth in production to 22.5 million tonne of hot metal with an investment of about Rs 37,000 crores. SAIL has also finalized extensive plans to improve the quality of products across the value chain and make value added steel, which would help in improving marketability and financial performance.

Essel Mining to buy coal mine in Indonesia

BS has reported that Aditya Birla Groups subsidiary Essel Mining & Industries Ltd is looking to acquire wholly or partially a coal mine in Indonesia at an investment of $80 million to $150 million. It is reported to have short listed about a dozen mines and is in the process of choosing investment banks to advise it for the acquisition.

Mr Ravi Kastia Aditya Birla group executive president and business head told Business Standard The Aditya Birla group is actively seeking to acquire a coal mine in Indonesia and will appoint an investment bank to advise us in the acquisition in the next couple of weeks. We have identified about a dozen mines and the mandate to the bank would be to complete the acquisition process in the next six months. Mr Kastia said We are looking to service export markets like India, South Korea and Japan from this acquisition but a lot depends on what kind of mine we get. If it is a coking coal mine, then the opportunities are broader but if it is merely a thermal coal mine then our options may narrow down.

Essel Mining & Industries Ltd has operations around Barbil in the Keonjhar and Sundergarh districts of Orissa and is estimated to produce about 7 million tonnes of iron ore with Fe content of 63% to 65% this year. Mr Kastia said that the company would increase production of iron ore to 9 million tonne in the next two years with an additional investment of Rs 200 crore.

JSW to take 6 months to acquire overseas coal mines

JSW Steel, which had earlier said that it was on the lookout for coal mines in Canada, Australia and Mozambique, said that it will take another six months to finalize the deal although there was a report that it has finalized acquisition of a coal mine in Mozambique.

Mr MVS Seshagiri Rao director finance of JSW said We have identified some coal mines and the talks are going on. However, it will take another six months to make a final announcement.

Mr Rao said that acquiring coal mines would help the company ensure a steady supply of coal and to isolate itself from the vagary of price hikes. It would also help the company to stay a few steps ahead among its peers and reduce production cost.

Brakes India considering a foundry unit in Oman

Business Line has reported that Brakes India Ltd is considering putting up a foundry unit in Oman. Mr S Viji MD said that the proposal was in preliminary stages and needed to be discussed with the company's foreign partner TRW.
Mr Viji said that Oman is a politically stable country. It also has a very good deep draft port which would make exporting out of the country easier. He added that the advantages of setting up a plant in West Asia include proximity to customers in Europe and the US and much lower power costs.

TVS Groups Brakes India has two divisions for brakes and foundry products. The turnover of the brakes division is of the order of Rs 500 crore. Sale of the foundry division is about Rs 200 crore with an installed capacity of 47,000 tonnes a year of castings.

IDLconsult bags caol mining contract from SCCL

IDLconsult has bagged a mining contract worth Rs 110 crore from Singareni Collieries Company Limited. Under the contract, IDLconsult will undertake works for drilling, blasting, excavation, hauling and dump yard management. The project is to be executed over a period of 24 months at Manuguru Open Cast mine in Khammam district.

Mr Subhas Pramanik MD of Gulf Oil Corporation said "We are honored to have bagged this large contract and we will continue to maintain the same standards of excellence in our performance and contribute to the economic growth in the mining industry. Our mining and infrastructure division has doubled its service income in 2005-06 to Rs 72 crore. We now have plans to double it again in 2006-07."

The company release said that IDLconsult had executed two major coal mining contracts in SCCL worth about Rs 90 crore in the past and its last project at Koyagudem was adjudged the Best Mine among all coal mines in the Singareni Collieries by the Directorate General of Mine Safety.

IDLconsult is the mining and infrastructure division of Hyderabad based Gulf Oil Corporation Limited.

MEPS estimates global crude steel production at 1.215 billion tonnes in 2006

The latest forecast by MEPS (International) Ltd for global output of steel in 2006 is 1215 million tonnes up by 7.5% over 2005. MEPS said that a number of factors are at work driving such rapid growth. Firstly, strong real demand continues in many important developing and emerging countries. Inventory rebuilding has also occurred in several industrialized nations after the production cuts in 2005. Finally, rising raw material input costs have prompted customers to order in advance of steel price hikes creating an exaggerated market for steel products.

Production Estimate ('000 tonnes)
Source: MEPS - World Steel Outlook

MEPS expect 2007 to show further advances in supply. But the rate of growth is likely to moderate from the levels of recent years. A period of inventory drawdown is anticipated in many of the industrialized nations.

China's domestic steel prices drop in July

Domestic steel prices in China dropped in July after five consecutive months on month rises as overproduction began to hit the market. A report released by the People's Bank of China showed that steel prices in July dropped 3.9% from June and 4.9% from the same month last year. This was the first monthly decline since January but the steel price still 11.9% up from the beginning of the year.

The dip in prices for some select products during this period at Shanghai is given below

Source Mysteel.com

Analysts said the decline showed overproduction has begun to bite on the steel market. China's steel production maintained its rapid growth in the first six months, with crude steel output approaching 200 million tons.

But the domestic prices have stabilized and in many cases moved up a little in last 2 weeks.

Arcelor-Mittal announces management changes at Mittal Steel US

Arcelor Mittal has announced changes at senior positions within Mittal Steel US that are designed to improve operational performance at the US operations and strategically align the company's flat products division in the Americas with long term goals for the combined company.

Mr Lou Schorsch president and CEO of Mittal Steel US has been appointed to the position of CEO Flat Products Americas. Mr Schorsch will lead the integration and executive management of flat rolled operations in the Americas including integration and oversight responsibilities for CST and Vega do Sol in Brazil, Mittal Steel Lazaro Cardenas in Mexico, Mittal Steel US and the flat rolled operations of Mittal Steel Canada. Mr Schorsch will report to Mr Aditya Mittal CFO of Arcelor Mittal who also has overall responsibility for Flat Products

Mr Mike Rippey has been selected to succeed Mr Schorsch in the role of president and CEO of Mittal Steel US. Mr Rippey previously served as executive VP Sales and Marketing of Mittal Steel US. Mr Rippey will continue to report to Mr Schorsch.

Mr Dan Mull has been appointed as executive VP of sales and marketing for Mittal Steel US.

Mr Bill Brake executive VP operations of Mittal Steel US will be leaving the company to pursue other opportunities and will be succeeded by Mr Len Chuderewicz who currently heads operations at Mittal Steel Indiana Harbor.

Mr Aditya Mittal said "We believe there are tremendous operational opportunities and strategic and synergy benefits to be captured in the new Arcelor Mittal American flat products division. As a result we have made key senior executive changes designed to ensure that we capture all of these opportunities in the optimum time frame.

Teck Cominco raises offer for Inco

Canada's Teck Cominco Ltd. raised its offer to buy Canadian mining company Inco Ltd on Tuesday just hours after Inco agreed to negotiate with CVRD about the Brazilian company's attempt to outbid two rival deals.

Teck Cominco plans to raise its offer to $89 Canadian dollars per share from $82.50, boosting it to $17.8 billion Canadian dollars.

World Bank predicts Chinas GDP growth at 10.4% for 2006

The World Bank has predicted that China's economy will grow by 10.4% in 2006 and by 9.3% in 2007.

World Bank in a quarterly report released in Beijing said China's gross domestic product expanded 10.9% in the first half of the year, implying second quarter growth of 11.3%, a pace not seen since 1996. Even so, the economic outlook remains favorable." The bank projected a mild slowdown in exports and fixed-asset investment for the second half, which would imply a slight fall in GDP growth to below 10%, resulting in the 10.4% rise for the entire year.

The report said that with production capacity continuing to expand in line with demand, inflation low and the current account in surplus, the economy does not threaten to overheat at present. In the long term, however, the continued investment boom warrants concern and makes more moderate growth desirable.

Severstals net profit dips by 27.6% YOY in H1

Severstal announced that its revenues calculated to RAS fell by 27.4% YOY in the first six months to 72 billion rubles ($2.7 billion). The company's gross profit fell by 24.5% in the reporting period to 22.1 billion rubles ($810 million) while pre tax profit declined by 25.5%, to 18.6 billion rubles ($688 million). Severstal's net profit fell by 27.6% YOY to 13.7 billion rubles ($503 million).

Novolipetsk Steel completes VIZ-Stal buy out

The Novolipetsk Steel has bought 100% stake in the Urals based VIZ-Stal steel producer for $550 million. The Novolipetsk Steel, whose chairman, Vladimir Lisin, controls about 90% of its stock, said it had financed the deal using its own funds. NLMK said that Viz Stal will be consolidated by NLMK from mid August, 2006.

The Russian Anti Monopoly Service approved a deal in early June allowing the Novolipetsk Metal Combine to purchase 100% of the shares of VIZ-Stal. But it prohibited the company to stop or limit steel output at the purchased facilities without its consent in order to maintaining competition.

Based in Ekaterinburg, Viz Stal is a rolling facility which specializes exclusively in electrical steel. Viz Stal produces cold rolled electrical steel sheet, and has a 56% share of the Russian grain oriented steel market and about 11% of the world market. Viz Stal's production capacity is approximately 200,000 tonnes per year of electrical steel.

China to face excess SS production capacity

China, which is dependent on import of stainless steel at present, is likely to face an overcapacity situation in coming years. Mr Chen Chuanping chairman of the Taiyuan Steel Group while attending the annual meeting of the stainless steel industry held recently warned that the production capacity of stainless steel in China ought to be controlled by restricting the building of new projects.

According to Mr Chen Chinas stainless steel production capacity is estimated to reach more than 10 million tons annually ion will soon put into production upon completion of all the projects.

Industry insiders pointed out that if the growth of the countrys stainless steel capacity is not put under control, the overcapacity will cause strong side effect in the next two years.

As per estimates China will produce 4.5 million tons of stainless steel in 2006 to become the largest producer of SS in the world.

Inco agrees to discuss with CVRD about its offer

Inco Ltd has agreed to negotiate with CVRD about its $17.2 billion cash takeover offer while affirming its rejection of Teck Cominco's cash and stock bid and continuing to support the cash and stock offer from Phelps Dodge Corp valued at $17.7 billion.

Inco said in a statement "The CVRD Offer could reasonably be expected to result in a superior proposal for purposes of the combination agreement (with Phelps Dodge). This determination allows Inco to engage in discussions and negotiations with CVRD and, accordingly, the board has authorized Inco's senior management and its advisers to engage in such discussions and negotiations."

The CVRD offer is open for acceptance until September 28th 2006.

Nickel dealers hoping for $30,000 levels

Due to global shortage and strong demand nickel for delivery in three months on the London Metal Exchange was $27,200 a tonne at 1008 GMT from $27,100 at Monday's close and a record high of $27,325 in Asia on Tuesday. Stocks of nickel in LME monitored warehouses fell by 132 tonnes overnight to 5,808, of which over 3,600 tonnes are already earmarked for delivery. Daily world nickel consumption is around 3,500 tonnes.

A dealer said "People are expecting nickel to hit $30,000. They buy early in the day in anticipation and sell in the afternoon. The game is still being played out. Some of the strength in nickel may also be to do with events in equities markets."

Mr Stephen Briggs of SGCIB said "Demand has bounced far more than anyone anticipated, and nickel producers have been unable to respond. What looked a few months ago to be a modest surplus has evaporated and the price should go up."

The doubling in nickel prices since the start of the year was sparked by an unanticipated rise in stainless steel demand coupled with miners' failure to ramp up production fast enough.

Corus to increase long product prices by 10%

Corus Group Plc announced that it will increase prices of long products by up to 10% from October 1 due to strong market demand. Mr Derek Randall commercial director for Corus's Long Products division said "Demand across our main markets such as construction, commercial vehicles and shipbuilding continues to be strong and we are increasing our prices."

ThyssenKrupp had announced last week it plans to raise prices for HR, CR and surface treated sheet steel by 30 euros per tonne starting in October due to higher raw material costs. Salzgitter has also said it expects to raise average prices for flat steel products by up to 40 euros per tonne in the fourth quarter.

V&M Star to supply seamless line pipe for Prudhoe Bay repair

Vallourec & Mannesmann Tubes V&M STAR has been selected to provide 30-35,000 feet of 10-inch, high strength, seamless line pipe for BPs Prudhoe Bay in Alaska pipeline operations.

V&M STAR has agreed to adjust current operating schedules in both its Houston and Youngstown facilities to provide BP with the best possible delivery. The process will begin in Youngstown with steel and pipe making and then the pipe will be shipped to Houston for final processing which includes heat treatment, inspection and end finishing.

Final delivery of the product will be made to BP in Houston by mid September and BP will arrange transportation from Houston to Prudhoe Bay.

Germany's IG Metall union to seek 7% wage hike

AFX has reported that German Trade union IG Metall will be demanding a 7% wage increase for about 85,000 workers in the steel and iron industries in three regions North Rhine-Westphalia, Bremen and Lower Saxony in western Germany when the wage bargaining talks begin on August 23rd.

The IG Metall spokesman said that IG Metall's Wage Commission has decided today to table a 7% wage hike with validity for 12 months. The last wage bargaining, which took place in 2005, saw IG Metall finally obtaining a 3.5% increase after initially asking for 6.5%.

Two steel producing regions in eastern Germany normally follow the results of wage talks in North Rhine-Westphalia, Lower Saxony and Bremen.

Ukrainian PM favors coking coal mines operations by steel mills

Ukranian Prime Minister Mr Viktor Yanukovych stated that it would be more efficient to sell the coalmines that mine coking coal to the vertically integrated steel holdings. Mr Yanukovych said The best effect would be if the mines will be acquired by steel holdings. They also must have coke plants in their chains.

The remaining state owned coalmines include 3.8 million tonne per year Donetskvuhillya, 2.1 million tonne per year Makiivvuhillya, 2.3 million tonne per year Dobropillyavuhillya, 2 million tonne per year Chervonolimanska mine and few others.

Coking coal mine privatization move, if undertaken, is likely to attract bids from almost all major steel making groups in Ukraine including Industrial Union of Donbas, Mittal Steel Kryviy Rih, Mariupol Illich Steelworks, Pryvat Group, SCM and Zaporizhstal.

Ukraines biggest coking coal mines with 6million tonne per year output Chervonoarmiyska Zakhidna has already been sold to Donetskstal group and Pavlohradvuhillya and Krasnodonvuhillya coalmining holdings are owned by System Capital Management.

Xstrata takes control of Falconbridge

Xstrata PLC has taken control Canadian mining company Falconbridge by acquiring another 67.8% of Falconbridge's outstanding common shares in addition to the 24.5% it already owned.

The statement said "Xstrata has now taken effective control of Falconbridge and both management teams are working closely together to facilitate a smooth and swift integration of the two businesses."

Xstrata also said that it is extending the expiry date of its all cash offer from August 17 to August 25 to ensure that remaining Falconbridge shareholders receive their $62.50 per share promptly.

Esmark welcomes support from USW

Esmark Incorporated has released a statement welcoming the announcement of United Steelworkers supporting the proposed combination of Esmark and Wheeling-Pittsburgh Corporation and opposing the proposed transaction between Wheeling-Pitt and Companhia Siderurgica Nacional.

Mr James P. Bouchard CEO of Esmark said in the statement "We are pleased, but not surprised, that the United Steelworkers has announced their strong support for the proposed Esmark transaction. Our vision is to combine the best of mini-mill production and downstream distribution resulting in a rebuilt Wheeling-Pitt. We are creating a regional steel company nimble enough to succeed in the rapidly evolving steel industry. To do so, there are several essential ingredients. First and foremost, the people that work in the mill must be empowered to help the new management team recreate this once great company. Second, Wheeling-Pitt must have a large customer base in the Midwest. Third, Wheeling-Pitt must be placed in a position to reduce; not increase its debt. We must lay the foundation for a company that can provide a greater return to its shareholders.

He said "We welcome the support of the United Steelworkers as we seek to elect our slate of directors at the next annual meeting. After election of our board nominees, we look forward to working together with the United Steelworkers as a partner."

Headquartered in Chicago and founded by the Bouchard Group, Esmark is a steel services family of companies.

Tenaris to seek clarification on EC ruling on Luxembourg laws

Tenaris SA said that it will seek clarification over a European Commission decision on the tax treatment of Luxembourg holding companies. Tenaris said it will seek clarification and take appropriate legal action in the unexpected case that the authorities fail timely to confirm Tenaris's interpretation.

Tenaris said the European Commission, following a probe of Luxembourg's 1929 holding company regime, determined that the tax treatment of holding companies is incompatible with the EU common market. Tenaris said the EC is requiring Luxembourg to cancel or modify the tax treatment of 1929 holding companies not later than Dec. 31, 2006. The EC decision contemplates a transition period that would allow preexisting 1929 holding companies to continue benefiting from their current tax regime after implementation of the EC decision until Dec. 31, 2010.

Tenaris said this benefit would appear to terminate if all or part of the capital of such companies is transferred during the transition period. Tenaris believes this termination does not apply to listed companies. Tenaris said it is confident the EC or Luxembourg will clarify this, but that no assurances can be given.

As a holding company under Luxembourg's 1929 regime Tenaris is exempt from corporate income tax and certain other Luxembourg taxes and its dividend payments are exempt from withholding tax.

EPA cites Mittal Steels Burn Harbor plant for clean air violations

PR News Wires has reported that US Environmental Protection Agency Region 5 has cited Mittal Steel US for alleged clean air violations at its steel mill located at Burns Harbor in Indiana. EPA alleges that in 1994, Mittal modified a coke oven battery, resulting in a significant increase in sulfur dioxide emissions, without getting a state permit that would have required the best available technology to control the emissions. These are preliminary findings of violations. To resolve them, EPA may issue a compliance order, assess an administrative penalty or bring suit against the company.

Mr Bharat Mathur acting regional administrator of EPA said "EPA's mission is to protect public health and the environment. We will take whatever steps are needed to ensure compliance with the Clean Air Act."

Mittal Steel has 30 days from receipt of the notice to meet with EPA to discuss resolving the allegations.

Exposure to sulfur dioxide can impair breathing, aggravate existing respiratory diseases like bronchitis and reduce the ability of the lungs to clear foreign particles. Sulfur dioxide can cause acid rain and contribute to fine particle pollution. Children, the elderly and people with heart and lung conditions are the most sensitive to sulfur dioxide.

Angang Steel Company Limiteds net surges by 154% in H1

Angang Steel Company Limited based on international accounting standards its net income in January to June 2006 increased to 3.1 billion yuan ($390 million) up by 154% from 1.22 billion yuan in H1 of 2005. Its sales in H1 of 2006 increased to 25 billion yuan up by 76% from 14.2 billion yuan in H1 of 2005.

Erstwhile Angang New Steel Co had earlier posted an 82.1% rise in first quarter net profit and had attributed the improvement to the purchase of Angang New Steel and Iron Co from parent company Anshan Iron & Steel Group Complex. Angang New Steel had also announced in April end an expected increase in the profits for the H1 100% to 150% as compared with the same period in 2005.

Caparo Merchant Bar to upgrade bar mill at Scunthorpe

UK based steel producer Caparo Merchant Bar has decided to upgrade their bar mill in Scunthorpe and has placed orders for major equipments.

The modernization project involves mill modifications and equipment installations to improve the mill's performance. CMB will replace the five existing mill stands of the roughing mill, install a so called joker stand and pendulum shear and also supply standby equipment.

Caparo Merchant Bar is largest producer of merchant bar in the UK with a manufacturing capacity in excess of 400,000 tonnes per annum.

Golden West stops work at Wiluna West iron ore mine

It is reported that Golden West Resources has stopped work at its Wiluna West iron ore mine site in Western Australia after being instructed to do so by the Department of Indigenous Affairs.

Mr Gary Hutchinson from Golden West Resources said the company will do all it can to comply with the wishes of Indigenous groups in the area. He said "We are supporting the area tremendously and we are employing Indigenous people and we're doing as much as we possibly can to make this work. Unfortunately, basically this seems to have gotten a little bit out of control, but hopefully we can resolve it very quickly."

Two Aboriginal groups had differing views about the location of sacred sites in the vicinity. A second independent survey of the land will now be carried out to determine areas to be safeguarded. The independent survey is expected to begin on Wednesday.

Wesfarmers profit jumps by 49% to $1 billion in 2005-06

Perth based diversified industry house Wesfarmer Ltd has posted a 49.3% rise in net profit to record $1.05 billion for 2005-06 but warned next year's results won't be as good. High coal prices combined with better production underpinned the record profit with the energy division generating $1.68 billion in revenue a 44.3% improvement on the previous year. Operating revenue increased to $8.9 billion in the year to June 30, 2006 up from $8.2 billion previously.

Mr Richard Goyder MD said that he was expecting improved earnings from most divisions in 2006-07 but warned lower coal prices would reduce the revenue from the energy division. He said "We are expecting a satisfactory profit in the coming year albeit lower than this record result. There's no point in gilding the lily and we've ridden the wave of high coal prices. The challenge as always is to find growth which is beneficial to our shareholders and nothing's changed in that regard."

Tenaga receives offer for TNB coal mining asset

It is reported that Tenaga Nasional Bhd has received proposals from several major Indonesian companies to buy its 92.5% equity interest in TNB Coal International Ltd. TNB Coal's mining asset in Indonesia is centered around Dynamic Acres Sdn Bhd, which in turn holds a 99% stake in DEJ. DEJ owns the exclusive mining rights to five concession areas in south Kalimantan, Indonesia and supplies coal to TNB Fuel Services Sdn Bhd Tenaga's wholly owned subsidiary since last year.

Indonesia's largest coal producer Padang Karunia to purchase the mining stake in TNB Coal from Tenaga by making an upfront payment of $5.50 million and a deferred payment of $18.25 million on a staggered basis. Padang Karunia is valuing TNB Coal's mining asset at $23.75 million.

A mining contractor for PT Dasa Eka Jasatama PT Pamapersada Nusantara is proposing to acquire TNB Coal by way of writing off Tenaga's investments and advances into DEJ totaling $28.9 million. PAMA is a subsidiary of PT United Tractors, the distributor of Komatsu heavy equipment in Indonesia. PT United Tractors is a unit of PT Astra International, one of the largest conglomerates in Indonesia.

EU increases Ukraines quota for steel exports in 2006

Interfax-Ukraine has reported that the European Union approved a 6% increase in Ukraine's quota to export steel this year, representing 60,480 tons of steel carried over from 2005.

The decision comes into effect on August 20.

Maverick Tube-Tenaris merger conditions

Maverick Tube Corp said in a proxy statement filed with the Securities and Exchange Commission that it must pay to Tenaris SA $72.5 million and also reimburse up to $5 million in expenses if its planned acquisition by Tenaris is terminated.

The proxy statement added that Tenaris must pay Maverick Tube $30 million if the merger isn't consummated due to failure to win Canadian and Colombian competition approvals. Canadian authorities have already approved the merger.

Tenaris is seeking to buy Maverick Tube for $65 a share, a deal valued at $3.2 billion including Maverick Tube's net debt and as per the statement from Maverick Tube its board has already approved the merger and has urged shareholders to approve the deal during a special meeting.

China to allow market forces to decide prices of resources

Chinas National Development and Reform Commission have decided to push ahead with its liberalization campaign. Mr Bi Jingquan NDRC's vice minister in charge of price reform said that "We will allow the scarcity of resources to determine their price. That's the basic principle of the price reforms."

Mr Bi said liberalizing the pricing of raw materials and energy will definitely increase costs in the long run, but the government is determined to make prices more dependent on market forces. Mr Bi said the government is considering further measures to liberalize the price of coal, electricity, oil, natural gas and water. As a result Chinese businesses will have to cope with continuously rising resources costs as pricing liberalization is sped up.

His words were echoed by a report released over the weekend, which called for price reforms to encourage more efficient economic growth. Industry insiders said his speech was the first time the government has formally expressed its determination for pricing reform.

Lone Star to form JV with Hunan Valin Steel

Lone Star Technologies Inc announced that it as entered into a definitive agreement to form a JV with Hunan Valin Steel Tube & Wire Co Ltd. As per the terms of the agreement, Lone Star will acquire a 40% stake in one of Valin Tube and Wire's subsidiaries, Hengyang Valin MPM Steel Tube Co Ltd for a consideration of $132 million. The transaction is expected to accretive to earnings in 2007.

Lone Star contemplates a series of future transactions related to the steel tube assets of Valin Tube and Wire with the expectation that Lone Star would eventually contribute up to an aggregate of $238 million.

Mechels net profit down by 31.7% YOY in H1

Mechel announced that its net profit as per RAS dropped by 31.7% in the first half of 2006 YOY to $16.87 million. It said that its pre tax profit had fallen by 31.8% to $17.36 million and gross profit by 50% to $4.13 million. Earnings increased 2.8 fold to $41.33 million.

Mechel has several steel plants and mines in Russia, Romania and Lithuania and its output totaled 15.6 million tonnes of coal, 5.9 million tonnes of steel, and 4.6 million tonnes of rolled metal in 2005.

Aztec board disappointed with Mt Gibsons bidder statement

Takeover target Aztec Resources Ltds directors continue to advise shareholders to take no action in regard to the unsolicited offer after receiving the bidder's statement from Mount Gibson last week. Aztec said that "The Aztec directors are disappointed with the lack of detail in Mount Gibson's bidders statement and believe that it does little to alleviate a number of serious concerns."

Aztec also questioned the production forecast for Mount Gibson's own Tallering Peak operation and queried the uncertainty of its Extension Hill projects.

Mr Ian Burston chairman said that Aztec would make a series of announcements in the coming weeks, shoring up the development plans for the Koolan Island project. Mr Burston said "These announcements will continue to demonstrate the value that is inherent within the company."

Aztec shareholders are being offered one Mount Gibson share for every three Aztec shares in an all scrip bid including Aztec shares due to be issued under forthcoming options expiries. The success of the offer would give Mount Gibson control of the high grade iron ore project on Koolan Island off the North West coast of Western Australia.

Phelps Dodges bid for Inco to be voted on September 25th

Phelps Dodge Corp shareholders will get a chance to vote on the proposed $17.7 billion takeover of Inco Ltd on September 25th 2006. The voter eligibility of Phelps shareholders will be determined by August 24th.

At least one major Phelps stockholder, Atticus Capital, has said it will vote against the Phelps-Inco combination because of the amount of debt the firm will incur in the transaction.

Teck Cominco Ltd has tabled its $17.7 billion cash and shares bid topped by CVRDs $17.2 billion cash bid of last week. Inco's board has consistently backed the Phelps bid, which began as a friendly three way merger that included Falconbridge Ltd.

SCMs MetInvest Holding aims for IPO

Ukrainian Media has reported that Mr Rinat Akhmetov, the majority shareholder of SCM which controls MetInvest, stated at the press conference in Donetsk that MetInvest will be ready to IPO by the end of 2006. The IPO can be expected in 2007.

Kobe Steel to increase crude steel production in fiscal 2006

Japanese steelmaker Kobe Steel expects that its crude steel production will be 7.6 million tonnes to 7.7 million tonnes for fiscal 2006 ending March 2007.

Its output decreased by 150,000 tonnes to 7.56 million tonnes in fiscal 2005 as against fiscal 2004 when the firm reduced the output in second half of fiscal 2005 to reduce commodity grade export and domestic sheet steel inventory.

Universal Stainless appoints Mr Hack as VP sales & marketing

Universal Stainless & Alloy Products Inc has announced that Mr Richard J Hack has joined the Company as VP of Sales and Marketing. Mr Hack has more than 25 years of steel industry experience, with a background in manufacturing as well as extensive sales and marketing expertise in the specialty steel segment.

Mr Mac McAninch president and CEO commented "Rick Hack is an important addition to the Universal Stainless management team. His knowledge and experience complement our current business focus and will enable us to pursue new opportunities to further grow our company."

Universal Stainless & Alloy Products Inc headquartered at Bridgeville in Pennsylvania manufactures and markets a broad line of semi finished and finished specialty steels including stainless steel, tool steel and certain other alloyed steels.