December, 31 2006
NTPC inks power plant agreement with Sri Lanka
Board of Investment of Sri Lanka has entered into an agreement with National Thermal Power Company Limited and the Ceylon Electricity Board to set up a coal based 2x250 Megawatt Power plant at Trincomalee in Sri Lanka. The power plant is expected to commence operations from 2011.
The project would involve an investment of $ 500 million and would be implemented by a joint venture company to be formed with a stake of 50% each by NTPC Ltd. and CEB. The project would be funded with a debt equity ratio of 70:30. A joint venture agreement between CEB and NTPC, a power purchase agreement between the JV company and CEB, an agreement between BOI and the JV Company, implementation agreement and coal supply agreement are expected to be signed soon.
Sri Lankan BOI will facilitate the project by granting tax holidays and other duty waivers for 25 years and help with obtaining the 500 acres that were needed for the project. In addition Sri Lankan treasury will provide $ 70 million for the CEB to commence the construction of a transmission line from Trincomalee to Veyangoda and to upgrade the existing grid sub stations. A $75 million jetty will be constructed by the Sri Lanka Ports Authority to handle the coal cargo needed to run the facility.
SCCL to achieve highest ever annual coal production in 2006-07
State owned Singareni Collieries Company Limited has announced that it is gearing up to achieve its all time high annual coal production target of 37.50 million tonnes during 2006-07.
Mr S Narsing Rao CMD of SCCL told reporters that SCCL has produced 25.56 million tonnes of coal up to December 27th 2006, highest ever in the company's 117 year old history, which is 1.522 million tonnes more than the corresponding period of last year.
Mr Rao said that coal demand on SCCL will be 52.04 million tonnes by the end of XI plan period of 2011-12 and the projected production would be 40.80 million tonnes. Mr Rao informed that SCCL plans to open 22 new mines in the state with an estimated investment of INR 2,915.61 crores to achieve the projected coal production in addition to current 58 coal mines.
PM calls WB to catch up with industrialization
Dr Manmohan Singh prime minister of India while addressing a ceremony to lay the foundation stone for modernizing Steel Authority of India Limiteds IISCO steel plant at Burnpur in the state of West Bengal said that time has come for a new era of industrial development in West Bengal.
PM reminded that the state had been in the vanguard of India's initial charge for industrialization, but had fallen behind in the last 25 years and hoped for a new era of industrial development as the state has slipped in keeping up with more developed parts of the country.
He said that "There was a time when the steel and the coal industry was doing very well but the state has fallen behind in industrial development in the past quarter century. It cannot continue to slip in such a manner. It must move forward in the march of progress and benefit from the rapid economic growth. The time has come for a new industrial and economic development in West Bengal.
Dr Singh said The time has come for a new era of industrial development in West Bengal. I hope the expansion of this steel plant here in Burnpur will mark a new beginning for West Bengal. The state needs modern industries and the jobs that come with it. It needs a process of industrialization which is employment-intensive, welfare enhancing and on the whole, humane and just.
The timing of the PMs open criticism of West Bengals industrial plight is significant due to the recent Singur developments and when Mr Buddhadeb Bhattacharjee chief minister of WB is battling stiff political opposition over farmland acquisition for large industrial projects.
Indian government to change coal royalty mechanism
ET has reported that, power tariffs in India may increase as the government is planning to revise royalty rates on coal and allowing states to levy up to 5% cess on coal over and above the royalty charges. As per report, the government is considering a new rate to be fixed between 20% and 22% of coal prices.
A coal ministry committee on coal and lignite royalty had earlier suggested shifting royalty rates on coal to a mix of specific and ad valorem duties, but under pressure from states, the Energy Coordination Committee at its recent meeting also favored advancing implementation of internationally acceptable ad valorem royalty rates.
The report mentions that the coal ministry would now revise the cabinet note to include both the options on royalty, mixed rate as well as ad valorem rate, and it will be up to the Cabinet to finalize the most appropriate option.
At present, the Centre fixes the rate of royalty on coal on per tonne basis for three years, which is payable to the state governments. As the rates were last revised in September 2002, a revision was due last year.
RIL plans JV with GMDC for lignite gasification project
It is reported that, Reliance Industries is planning to invest INR.5000 crore for gasification of lignite in South Gujarat under a JV with Gujarat Mineral Development Corporation.
RIL will be using Uzbekcoal and Yerostigaz technology for the project in which the lignite reserves located deep down will be converted into gas by burning controlled burning them and the gas generated from this process will be retrieved through pipes.
The produced gas will be used in power generation, fertilizer units and also in value added products like manufacturing of liquid fuels.
NMDC awarded ISO 14001 by DNV
National Mineral Development Corporation has received ISO-14001:2004 certificates, relating to up gradation of environment management of its projects from Det Norske Veritas.
Mr B Ramesh Kumar CMD of NMDC said that environmental credibility has become a major factor in national and international competitiveness.
Gujarat coast line attracts many firms for shipbuilding facility
EximNews has reported that Gujarat Maritime Boards proposal to construct over half a dozen shipbuilding and repair yards on the coast of Gujarat is attracting several firms, which is driven by boom in Indian shipbuilding industry as global players have their order books full up to brim.
As per reports, in addition to existing players like L&T, Adanis, Pipavav shipyard and ABG Shipyard, Mercator Mech Marine, Core Marine Tech, Gujarat Shipbuilding, Sandesara Group, Dolphin Offshore Enterprises and Startek Marine etc are keen to setup shipbuilding and repair facilities in Gujarat.
GMB had commissioned a study to develop shipbuilding yards in Gujarat and identified 5 sites for setting up shipbuilding facilities at an investment of around Rs 200 crore to Rs 400 crore depending upon the size of vessels to be built. The sites include the coastal belts between Gogha and Mithivirdi in the gulf of Khambhat, between Salaya and Sikka in the Gulf of Kutch, between Jodia and Navlakhi in the Gulf of Kutch, on the estuary of Narmada River in the Gulf of Khambhat and in South Gujarat region near Billimora. In addition, some companies are looking at sites such as Dahej and Bhavnagar
Nagarjuna Construction bags orders for INR 370 crore
Nagarjuna Construction Company Ltd has informed the BSE that the company has secured three new orders aggregating to INR 370 crore.
The first order valued at INR 282 crore is for water supply at Ajmer in Rajasthan. The project completion period is 24 months and operation and maintenance period is for five years.
The second order valued at INR 65 crore was obtained from Sahara India Commercial Corporation Ltd for construction of 72 villas at Amby Valley City near Pune. The project completion period is 18 months.
The third order valued at INR 23 crore is from the Military Engineer Services Chandigarh for augmentation of Water Supply of Ambala Cant. The project completion period is 24 months, a company release said.
Chinese domestic market to face glut due to inventories
The inventories of steel held by major mills in China have increased to their highest level in November 2006 and that the stockpile of unsold metal equals 26% of the Chinas monthly output. National Development and Reform Commission n a statement posted on its Web site said that The market condition is tougher. Stockpiles of wire rods, reinforcement bars and other products rose by 17% to 6.16 million metric tons as of November 30th from last December.
NDRC said that Chinas 5th largest steel maker Jiangsu Shagang Group, has the highest ratio of stockpiles to monthly output of the country's top five producers as its inventories are equivalent to 41% of its monthly output as compared with 29% at Baosteel Group Corp, 13% at Anben Steel Group, 6.1% at Tangshan Iron & Steel Group and 15% at Wuhan Iron & Steel Group.
Chinese government has recently tightened rules to curb exports by imposing export taxes of 10% on pig iron, steel billet and semi finished steel products and reducing export rebates on steel exports to 8% from 11%. These moves will curb exports to some extant temporarily, but result in a glut in domestic market reducing domestic prices, which will after sometime force Chinese steel makers to increase exports as they will realize more or almost equal prices even after paying taxes imposed for exports.
Russia & EU sign deal for 2007 metal quotas
Russian ministry of economic development and trade announced that Russia and the European Union have signed an agreement on trade in metal products for 2007.
As per announcement, Russia managed to negotiate with the European Union in advance the terms of metal products trade in 2007 and that 2007 trade quotas will be equal to those in 2006 amounting to 2.27 million tonnes. In addition, the rules of distribution and licensing will also remain same.
Russian metallurgical companies have used almost 100% of quotas on exports of steel of different categories to European Unions countries in 2006. The Russian companies exported some 2.2 million tonnes of metal products, which is 30% more than in 2005.
Arcelor Mittal and Laiwu Steel extend deadline
China's 8th largest steelmaker Laiwu Steel has extended the deadline for closing the earlier announced deal for selling 38.41% stake to Arcelor Mittal as it is waiting for approval from Chinese government.
Laiwu Steel in a regulatory filing at the Shanghai Stock Exchange said that its state owned parent was discussing a new date for the deal to be completed with Arcelor Mittal as the approval process is still making its way through the relevant central government departments.
Arcelor agreed in February to buy a 38.41 per% in listed Laiwu, half of the shares owned by Laiwu's state owned parent. The deal was set to be completed by March 31 2007. If Beijing approves the Laiwu deal, the combined Arcelor Mittal would own stakes in two of China's leading steel firms, Laiwu and Valin Steel Tube and Wire, which has been bought by Mittal Steel. In each case it would have just short of a controlling stake.
Chinas 8th largest Laiwu Steel and 7th largest Jinan Iron and Steel Co Ltd are due to merge under a plan by the Shandong provincial government to create the country's second largest steel maker.
Iron ore price increase not likely to affect Chinese steelmakers
Global iron ore majors, led by Companhia Vale do Rio Doce, have concluded the iron ore price negotiations for 2007 with BaoSteel Group representing all Chinese buyers and mills, Japanese, Korean and some European steelmakers for increase of 9.5% over 2006 prices.
Chinese steel industry experts however do not see much effect of increase in raw material price to the cost of making steel as they see sea borne freight rate to fall down for fiscal 2007 and also considering RMB:$ movement.
Analysts point out that the price rise of 9.5% is equivalent to approximately RMB 50 and assuming steady sea borne freight rate, steel making cost will climb up by RMB 80 per ton provided that 1.6 tons of iron ore is need for making 1 ton steel. However, the cost will drop by RMB 36 per ton in case RMB exchange rate keeps 5% next year. In addition the fall in sea borne rates will further reduce the CFR prices of iron ore for Chinese steelmakers.
Against such backgrounds, it is concluded that iron ore price rise will not put much negative influence on Chinese steel market prices, especially for those high end steel products, such as stainless steel, color coated sheet and galvanized sheet that will hardly be shaken by the prices rise. Costs for making billet and rebar can also be controlled.
Brazilian iron ore exports to cross $10 billion in 2007
News agency AE-Setorial has reported that, Brazilian iron ore exports could surpass $10 billion in 2007 due to 9.5%increase in iron ore price negotiated by CVRD with Japanese steelmakers, Baosteel and POSCO.
As per the report, Brazilian iron ore shipments brought in $8.95 billion in 2006.
Mr Jose Augusto de Castro ED of the Brazilian Foreign Trade Association said that, "It will be the first time a single product has surpassed the $10billion barrier in sales abroad.
Nickel retains No 1 position in Cuban export in 2006
Nickel retained its first place among Cuban exports in 2006, its earnings boosted by unprecedented high prices on the international market, although output was lower than the government had hoped. Nickel has been Cuba's top traditional export product since 2000.
Total Cuban nickel production in 2005 amounted to 75,900 tons, similar to output for 2004, and a very modest increment of 1.1% was planned for 2006.
Last year, Cuba reached an agreement with Sherritt International for expanding production at the Moa-Nuel plant, and incorporating the latest technology at a Canadian cobalt nickel refinery, financed with more than $500 million dollars contributed equally by both partners. The expansion of the Moa-Nuel plant was intended to increase output by 16,000 tons year by the end of 2008. But Sherritt itself has now announced that the plans to increase Moa-Nuel's capacity will have to be reviewed, and are now forecasting staged production increases of 4,000 tons for 2008, 9,000 tons in 2009, and a further 3,000 tons by 2011. The Cuban Canadian joint venture owns the processing plant at Moa, in the eastern Cuban province of Holgu, a refining facility at Fort Saskatchewan, in the western Canadian province of Alberta and a trading corporation in the Bahamas.
Two other nickel processing plants, the RenRamos Latour and the Ernesto Che Guevara facilities, operated at full capacity in 2005. They are both owned and operated by the Cuban state Uni del Nuel Company.
Cuba has substantial nickel and cobalt reserves located in Moa and Nicaro, in the province of Holgu. Proven nickel reserves are estimated at 800 million metric tons, and probable reserves at two billion tons. Cuba's cobalt reserves, meanwhile, account for approximately 26% of the world's total reserves. Russia, the United States, Canada, Australia, Norway and Cuba are the world's foremost producers of nickel.
China plans to build 5000 kilometers long highways in 2007
China will build at least 5,000 kilometers of expressways next year, bringing the total length of expressways in the nation to over 50,000 kilometers by the end of 2007 and also complete the remaining 2,385 kilometers portion of national highway trunk system composed of five north south highways and seven east west highways, with a total length of 35,000 kilometers.
Mr Li Shenglin minister of communications told a Beijing conference that 4,460 kilometers of new expressways had been built and opened across China in 2006 and now China has 45,400 kilometers of expressways, the second longest in the world only after the United States, which had 90,000 kilometers in 2005.
According to the country's expressway plan, between 2006 and 2010, China will build 24,000 kilometers of new expressways and will have 85,000 kilometers of expressways by 2020.
Ukrainian pipes still competitive in Russia
Mr Viktor Yanukovych prime minister of Ukraine said during a press conference in Kiev said that Ukrainian large diameter pipes remain competitive on the Russian market in price even after the imposition of an 8% import duty by Russia.
He said "We supply large diameter pipes to Russia, and our price still remains competitive compared to Japanese pipes. The level of pipe production profitability is sufficient to continue their production ad supplies on the Russian market.
Shenhua to increase coal out put by 11% in 2007
China Shenhua Energy expects its 2007 coal output to increase by about 15 million tonnes a year due to strong demand. The increase represents about an 11% rise from this year's output, which is expected to be at least 136 million tonnes after producing 122.1 million tonnes of coal in 2005.
Shenhua Energy's coal output is tracking the strong demand in the mainland, where coal is the main energy resource. Demand for coal in China, the world's largest coal consumer, is expected to rise 4.2% to 2.5 billion tonnes in 2007.
Russian non ferrous capacities to rise in 2007-2011 period
According to Russian analysts of IA INFO Line prospects of Russian non ferrous metallurgy look sufficiently favorable.
It said that the production capacities of Russian metallurgical enterprises will grow significantly during 2007-2011 period, with alumina making capacities increasing by more than 30%, primary aluminum by more than 25%, refined copper by more than 35% and zinc by more than 50%.
Zhanjiang Ports handling crosses 80 million marks in 2006
Chians Zhanjiang's port capacity had hit record high at 80.96 million tons up to December 29th 2006 up by 15 million tons YoY.
Zhanjiang port has developed 300,000 ton oil terminal, 250,000 ton deep channel and 200,000 ton iron ore terminal in recent years have upgraded local ports.
Zhanjiang Port capacity is estimated at over 100 million tons in 2008 and 150 million tons in 2010. 42 new productive berths and 135 million tons of fresh port capacity in the end of the 11th Five Year Plan are expected to drive the port to a major one in South China. During the 11th Five Year Plan another RMB 10 billion will be injected into the constructions of harbors and channels, mainly eight projects including 300,000-ton channel and container terminal in Baoman
(Sourced from Mysteel.net)
Kosovo selects 4 firms for energy deal
Kosovo has short listed CEZ/AES, Germany's RWE Power AG, a partnership between German EnBW and US based WGI, as well as a consortium of Italy's Enel and the Greek American Sencap to revamp the province's energy sector.
The four firms will bid to build a new power plant, upgrade an old one and open a new coal mine in what is being billed as the largest investment in the province since it came under UN administration in 1999. Officials said earlier that the project to build the power plant, with a capacity of 1800MW to 2100MW should be completed by 2012. It will cost about EUR 3 billion ($ 3.9 billion).
Kosovo, a province of 2 million people, has suffered frequent power shortages over the past seven years, making it dependent on expensive imports, an anomaly for a territory with billions of tons of coal reserves. The province has two thermal power plants just outside the capital Pristina, but they are old and dilapidated and prone to breakdowns.
