June, 13 2007
L&T bags substation order at BSP from SAIL
It is reported that Steel Authority of India Limited has awarded an INR 1.14 billion contract for the turnkey construction of 220KV/132KV gas insulated substation and associated transmission network for its Bhilai Steel Plant in Chattisgarh to Larsen & Toubro.
The work involves supply, erection and commissioning of main step down substation MSDS—V. The scope of work includes construction of 220 kV (10 bays)/ 132KV (16 bays) gas insulated substation, state of the art 4 storied control room, installation of substation automation system, HVAC/fire fighting system, 160 MVA power transformers, AS/DC auxiliary power system, internal and external lighting, including EHV/HV cabling and associated 220/132kV transmission lines.
When completed; this project will evacuate power from 500 MW captive power plants being set up by NTPC SAIL Power Company and feed it to the Bhilai Steel Plant.
MECON is the consultant for the project and the duration of the contract will be 16 months from June 2007.
Over 250 power players in fray for captive coal blocks
It is reported that more than 250 companies have applied for the allocation of 17 captive coal blocks with the estimated coal reserves of 3.44 billion tonnes situated in Chhattisgarh, Jharkhand, Maharashtra, Orissa and West Bengal. The screening committee has convened meeting with these applicants from June 20th 2007 to June 23rd in New Delhi.
The list of applicants includes independent power producers, captive power producers, state utilities and new entrants. Some of the well known names are as under
1. TATA Power Company Limited
2. Reliance Energy Limited
3. Lanco Infratech
4. Essar Power Limited
5. AES Chhattisgarh Energy Private Limited
6. CESC
7. Ispat Group
8. GMR Group
9. Spectrum Power
10. GVK Power
11. Jindal Steel & Power Limited
12. Torrent Power Liited
13. Steel Authority of India Limited
14. NTPC-SAIL Power Company
15. Bharat Aluminum Company
16. Uttam Galva Steel Limited
17. Gujarat Urja Vikas Nigam
18. West Bengal Power Development Corporation
19. Chhattisgarh State Electricity Board
20. Himachal Pradesh Power Corporation
21. Jharkhand State Electricity Board
22. Karnataka Power Corporation
23. Emco Energy Limited
24. JLD Yavatmal Energy
25. Baidyanath Power and Mining
26. Abhishek Thermal Power
The union coal ministry has made it clear that preference will be accorded to the power and the steel sectors. Within the power sector also, priority would be accorded to projects with more than 500MW capacities. Similarly, in steel sector, priority would be given to steel plants with more than 1 million tonne per annum capacity.
ISA refutes CORSMA’s allegations on HR availability and prices
PTI reported that India’s domestic HR coil producers have dismissed allegations that higher exports have led to a rise in steel prices and said that only surplus in the domestic market is being exported.
Indian Steel Alliance in a letter to Mr Ram Vilas Paswan union steel minister has objected to campaign carried out by the Cold Rolled Steel Manufacturers Association asking for lowering the custom duty on HR coil and imposing duty on their exports.
ISA in their letter said that “There has been massive 300% to 400% rise in input and freight cost. HR coils price charged by domestic producers are in consonance with economically viable cost or products. Moreover, the national policy does not permit intervention in fixing prices. Also, increasingly exports of HR coils from India are of high grade products which do not find a local market. Exports are in line with the declared National Steel Policy.”
ISA also said that the domestic prices of CR coils have increased at a higher proportion than that of HR coils.
ISA includes all HR coil manufacturers except TATA Steel.
JSW Group plans cement venture
FE reported that JSW Group is venturing into cement production in a fairly big way and has floated JSW Cement for setting up a slag based 4 million tonnes clinker facility in Andhra Pradesh at an estimated cost of INR 1,200 crore to INR 1,300 crore in the first phase by 2009. JSW Cement will then look at hiking the capacity to 8 million tonne by 2012 in the second phase.
As per report, the new facility will be a split location plant with the clinker plant in Andhra Pradesh near the limestone deposits and the grinding units will be spread across 2 locations one each in Karnataka and Andhra Pradesh.
Mr Sajjan Jindal vice CMD of JSW Steel said that “We, as a group, will be focusing on bulk materials, as our core competence lies in these businesses, which include steel, aluminum, energy and cement. We are yet to reach a financial closure for the cement project, but we are currently working on it. We will move very fast after that.”
Coastal Energy inks coal agreement with Australian Griffin Coal
BS reported that Coal and Oil Group’s Indian subsidiary Coastal Energy has signed a MoU with Griffin Coal Company of Western Australia for sourcing thermal coal to supply to its customers in India. The partnership comes after the successful first shipment of thermal coal from Griffin in February 2007 and use of the same coal by the industry.
As per report, Griffin will initially supply 1.5 million tonnes per annum and may expand the supply in future.
Mr Murray Frangs manager coal marketing of Griffin said that the group had been working with Coal and Oil to supply coal from its mines in Western Australia.
Griffin Coal commenced operations in the Collie Coalfields in 1927 as a supplier of coal to ships, the railways and the WA Goldfields. Since then, it has evolved into a world class open cut mining operation with its Muja mine being acknowledged as one of the deepest open cut coal mine in the Southern Hemisphere. Griffin has the capacity to supply 5 million tonnes per annum and is reported to have identified over 500 million tonnes of coal reserves in Western Australia. Griffin Coal's total mineable coal reserves exceeding 150 million tonnes from a total open cut resource of 370 million tonnes.
SCI plans to buy 72 vessels to reach 8 million DWT capacity by 2105
It is reported that the Shipping Corporation of India has earmarked USD 960 million to acquire 12 ships for delivery by 2010. Out of the 12 ships, 2 are very large crude carriers, 2 are containerships, 2 belong to the product anchor class and the remaining 6 are crude carriers.
Mr S Hajara CMD of SCI said that the company has placed orders for 12 vessels entailing an investment of USD 1 billion, while orders for 60 more for USD 3 billion are being planned in phases. The first 12 ships are scheduled to be delivered between 2008 and 2010, while the additional 60 will come in the next five years.”
Mr Hajara added that SCI is sitting on a huge cash reserve and had a healthy debt equity ratio that could support its expansion plans. SCI has a surplus cash reserve of USD 800 million and its debt equity ratio is 0:3 giving it enough leverage to raise more dept.
At present, SCI has a fleet of 79 vessels. The capacity of SCI is 4.8 million DWT. SCI is expected to increase capacity to at least 8 million DWT once the acquisitions are completed.
IPI pipe line project agreement by July 2007
It is reported that India, Pakistan and Iran are likely to sign an agreement for a USD 7 billion tri nation gas pipeline by end of July 2007. The 2,300 kilometer long pipeline will initially carry around 60 million cubic meters of gas a day, split between India and Pakistan equally.
The report cites Mr MS Srinivasan union petroleum secretary as saying that "India and Pakistan will have a meeting shortly to sort out issues on transportation tariff and transit fee, after which ministerial level signing of framework agreement for the pipeline will happen.”
Mr Srinivasan added that “Iran has offered to sell gas at Iran Pakistan border and all responsibilities for the safety and security of the pipeline within Iran will vest with Iran." He added that following agreement on the two issues, Iran, Pakistan and India will sign framework agreement for the project.
It is reported that Iran wants to sell gas to India and Pakistan at USD 4.93 per million BTU with transportation tariff and transit fee extra. Pakistan is seeking a transportation tariff of USD 0.70 per million BTU to USD 0.75 per million BTU. India and Pakistan have broadly agreed to the pricing formula suggested by Iran but rates still need to be agreed by all the parties.
Kandla Port posts 43.6% growth in April to May 2007
It is reported that Kandla Port registered a throughput of 10.68 million tonnes during the two month period a growth of a whopping 43.68% over the corresponding period of the last fiscal. In addition it registered an all time high monthly throughput of 5.964 million tonnes in May.
As per report the 43.68% growth in throughput can be largely attributed to the jump in liquid traffic. In the first two months of this fiscal, the liquid throughput was 7.655 million tonnes as compared to 4.937 million tonnes in the corresponding previous period. During the same period the volume of crude traffic handled was 6.008 million tonnes.
Kandla Port also recorded an impressive growth in container handling. During the period under review, the throughput at 34,000 TEUs as compared to 26,000 TEUs in the same period last year showed a growth of more than 30%.
According to a Kandla Port Trust release, the port also improved upon all its performance and productivity parameters, such as average pre berthing detention, average turnaround time and average per berth day output, during the period. The release emphasized that the Kandla Port is all set to scale new heights and consolidate its achievements further.
NTPC asked to focus on generation rather than equipments making
ET reported that India’s Planning Commission has raised objections over the National Thermal Power Corporation’s proposal for setting up power equipment facility and has suggested that NTPC should focus on its generation business and leave it to Bharat heavy Electrical Limited and other private players.
A senior official of the Planning Commission told ET that “Manufacture of power equipment is a specialized area not core to the operation of NTPC. We have informed the power ministry that PSUs should concentrate on its generation business and private sector players should be encouraged to enter this area to augment production and provide an alternative to BHEL.”
The official added that “NTPC is not favored to start power equipment business as it could run it into financial trouble. BHEL has an established set up where costs have been optimized. NTPC would have no option but to increase its power cost to support its equipment business, a situation to be avoided.”
The Planning Commission has suggested that instead of letting NTPC into equipment manufacturing, government could consider changing the norms for supplies. The bidders could be asked to set up a domestic manufacturing unit to get preferential treatment on contracts.
Mr Sushilkumar Shinde union power minister had earlier told that NTPC may rope in an overseas partner for this venture. NTPC indicated that it would enter power equipment manufacturing business to support the growth of power generation in India. Meanwhile, NTPC has already initiated a pilot project at its existing thermal power station at Rihand in Uttar Pradesh to set up a maintenance workshop for its existing power units. It has also formed a JV company called Utility Powertech with Reliance Energy to take up assignments of construction, erection and supervision in power sector.
Orissa identifies 13 spots for port development
It is reported that Orissa Government has identified 13 places where the ports would be developed in the state. Mr Jaynaryan Mishra transport and commerce minister of Orissa informed this decision to state assembly last week and said that steps have already been taken to develop4 ports at Dhamra, Gopalpur Kirtania and Jatadhari.
Dhamra port will be developed under the JV of the L &T and Tisco and would be completed by the end of January 2010. The port authorities have already acquired 879.49 acres of lands. Steps have been taken to build the railway line connecting Bhadrak to Dhamra. The Company has already made its financial closure.
For the development of the Gopalpur Port Orissa Government has already signed a MoU with Gopalpur Ports Limited. The port will be fully operational by October 2010.
For the development of the Kirtanai port, Orissa Government has signed a MoU with the Creative Development and would start its project work by the beginning of January 2008.
To set up Jatadhari port, POSCO India has already signed a MoU with the state government and Pune based Central Government Water and Power Research Centre has made a survey to this effect.
Global Oil and Energy Ltd inks MoU with Bangladesh
It is reported that Ispat Group’s subsidiary Global Oil and Energy Ltd has signed a MoU with Bangladesh’s Board of Investment to invest USD 2.9 billion in Bangladesh. As per the MoU, BoI will facilitate the Global Oil and Energy Ltd in conducting the necessary feasibility on the proposed projects.
Global Oil and Energy Ltd is proposing to invest USD 1.5 billion in petrochemical, USD 500 million in power generation, USD 300 million in coal mines development, USD 100 million in oil exploration & production and USD 500 million in NGL/LNG production and other infrastructure projects.
After signing the MoU, Mr Vinod Mittal MD of Global Oil and Energy Ltd told reporters that his company would start a feasibility study within three months to materialize the investment offer. He said that the Group's main focus would be on coal and energy.
Mr Nazrul Islam executive chairman of BoI hoped that they would be able to successfully deal with the investment proposal. He said that this investment proposal is not complex like that of another Indian industrial giant TATA Group.
Kandla Port receives 31 EoIs for its three projects
It is reported that Kandla Port Trust has received 31 EoIs from 18 infrastructure companies for its following 3 projects to be developed on a build, operate, transfer basis by the selected private developer.
1. Building an offshore berthing facility at Tuna
2. Development of ship building yard at Tuna port at Kandla
3. Single point mooring facility at Veera in Kutch
The list companies, reported to have submitted EoI’s include
1. Welspun
2. IL&FS
3. Leighto
4 Essar Constructions
5. ABG Shipyard
6. AFCONS Infrastructure
7. Gammon Infrastructure
8. West Asia Maritime
9. Regal Shipping
10. Zoom Developers
11. Bombay Marine Engineering Works
12. Arcadia Shipping
13. SKIL Infrastructure
14. Gokul Refoils & Solvent
15. Gautam Freight
16. JM Baxi & Co
17. IMC
18. Nitesh Infrastructure
Out of 31 EoIs 16 are for building offshore berthing facility, 6 EoIs are for the development of ship building yard and the remaining are for setting up of a Single point mooring facility
Bharati Shipyard secures new order for Norwegian firm
Bharati Shipyard Ltd announced that Norwegian offshore shipping I Ltd has ordered two 150 tonnes bollard pull anchor handling tug and supply vessel. The contract value of each vessel is USD 32.5 million totaling to USD 65.1 million (INR 260 crores).
As per the company release, these orders are the largest order for the anchor handling tug supply vessels being placed in India by the European customers.
With the above orders, Bharti Shipyard’s total order books stand at INR 3,723.65 crores comprising of 41 vessels.
IDFC plans to raise USD 10 billion to fund infrastructure projects
It is reported that Infrastructure Development Finance Corporation is planning to rise about USD 10 billion as there are lots of infrastructure projects waiting to take off and infrastructure financing has never looked more promising.
The IDFC board that is slated to meet on June 28th 2007 will clear a proposal raising staggering INR 40,000 crore which will be raised as debt over a period of time. It is also planning to raise its FII limit to 74% from the current 49%.
With the current net worth of INR 3,000 crore, IDFC is planning to raise additional INR 2,000 crore equity and with this additional equity its net worth would go up to INR 5,000 crore resulting in a leverage ratio of 1:7 or 1:8.
IDFC needs all this cash to fund its principal mandate of financing infrastructure growth in India. It is also looking at new avenues for growth and is planning to get into funding steel and cement projects.
Southern Iron to increase in authorized share capital
Southern Iron & Steel announced that its board of directors at the meeting held on June 11th 2007 has decided to convene a shareholders’ meeting on July 19th 2007 to get the approval for increase in authorized share capital, amending the memorandum and articles of association, increasing the borrowing power and conversion of balance optionally convertible loans.
The release added that the conversion of balance optionally convertible loan will be made into equity of face value of INR 10 at a premium of INR 52 each, and or into 10% cumulative convertible preference shares of INR 1 each with an option to convert into equity.
Rio considering Pilbara expansion to 320 million tonnes
It is reported that Rio Tinto is considering adding another 100 million tonnes capacity at its Pilbara iron ore operations, an increase of almost 50% on existing expansion plans, as it seeks to ensure its market share in a bull market.
Mr Sam Walsh CEO of Rio Tinto briefing analysts in Perth said that for the first time put a precise number on the group's plans to expand beyond the targeted capacity of 220 million tonnes a year by 2009, with studies under way on increasing capacity to 320 million tonnes.
In the Pilbara, Rio earlier this year committed an extra USD 860 million to expanding its Cape Lambert port, which, along with other expansions, will allow it to raise capacity to 220 million tonnes by the first quarter of 2009 from 170 million tonnes. According to Mr Walsh, the project is running ahead of schedule and Rio is now assessing the infrastructure and mine developments to underpin expanding capacity to 320 million tonnes.
LME announces two regional steel billet futures contracts by April’08
London Metal Exchange has announced that it will commence futures trading in steel billet in April 2008 and that there will be two regional contracts one each for the Near East and one for the Far East. The announcement is the first part of the LME’s offering of price risk management tools to the steel industry and it follows a period of extensive consultation with LME members and physical industry.
Mr Martin Abbott CEO of LME said that “There are many ways in which price risk management tools can be delivered to the steel industry. Our physically delivered steel billet contracts are the first of what could be several steel contracts offered by the LME. In providing this service we are building on the credibility and experience that we have developed in over 130 years of base metals trading and physical delivery as well as the vast knowledge and distribution mechanism represented within the LME member firms.”
Mr Liz Milan manager of LME steel business added that “Like all contracts the steel billet contracts will take time to build but there is a real appetite for this offering from our members their clients and from those in the steel industry who already recognize the value of price risk management tools. For those that don’t yet see the benefits the LME will commence a thorough program of education.”
The LME is the world’s premier non ferrous metals market and achieved volumes of 87 million lots in 2006, an increase of 10.6% on 2005 figures and equivalent to USD 8,100 billion in monetary terms. Trading at the LME in non ferrous metals and plastics takes place across three platforms through open outcry trading on the Ring, through an inter office telephone market and through the electronic trading platform LME Select.
Ningbo Steel's phase 1 start operations
Ningbo Iron & Steel Co has declared official startup of first phase of its new project, indicating revival of the former Ningbo Jianlong after one year shut down. First phase of Ningbo Steel's new project is designed with 2 million tonnes steel making capacity, half of its total planned capacity. Construction of the second phase has also started and is slated for commissioning by the end of 2008 to take its capacity to 4 million tonnes. The company will mainly build HR sheet/plate, CRC and galvanized steels.
Ningbo Steel's new project includes two 6 meter electric furnace, one 2.5 million tonnes pillet line, two 2500 cubic meter blast furnaces, two 180 tonne converters, a 1780mm hot rolling mill, a 1780mm cold rolling machine, one galvanizing and two color coating lines as well as supported infrastructures.
Ningbo Jianlong was first planned in 2002, but had its construction halted in June 2004 by the authority, after the company was disclosed of misconducts in several accounts like bypassing China government's approval process. Considering its conformity with China's new steel industry policy, Zhejiang provincial government re submitted the project proposal to the NDRC in 2005, which got approved for regrouping on March 16th 2006.
Ningbo Steel has registered capital of CNY 6.8 billion with CNY 17 billion invested in building of the 4 million tonnes project. The company is renamed as Ningbo Iron & Steel Co Ltd. After regrouping, Hangzhou Iron & Steel Group Corp will hold a majority 43.85% of the new mill's total shares, Tangshan Jianlong Industry Co Ltd 30.53%, Nanjing Iron & Steel United Co Ltd 20%, Fujian located Union Trust & Investment Limited 5.62%.
(Sourced from MySteel.net)
Nippon and Toyota agree for 10% hike on auto part steel- Report
Nikkei, without citing sources, reported that Nippon Steel Corp and Toyota Motor Corp have agreed to a more than 10% increase in prices for steel materials used to manufacture automotive parts. The report added that the price hike would be the first in 2 years and will be applied retroactively to April 2007 shipments.
Under the agreement with Toyota, Nippon Steel will increase by a flat JPY 10,000 the price it charges for special steel, which are now supplied at JPY 85,000 per tonne used to produce drive train components and other parts.
Nippon Steel and Toyota are also expected to agree sometime in June 2007 on a 5% increase in prices of steel sheets used for car bodies.
As per report, the higher prices are likely to cost automakers JPY 70 billion to JPY 80 billion.
Xstrata declare force majeure on coal deliveries from Newcastle Port
Bloomberg reported that coal and metals miner Xstrata Plc has declared force majeure on some coal deliveries after floods halted loading at the port of Newcastle in Australia.
The report cites Mr Marc Gonsalves a spokesman for Xstrata as saying that “The decision applies to vessels queuing at the port. It doesn't apply to demurrage or costs paid to a ship owner when a vessel is kept waiting to load its cargo beyond a scheduled time.”
He added that “Sales out of our New South Wales operations will be impacted by the damage to infrastructure and we have alerted our customers to that. The impact is not at this stage quantifiable by us.''
Mr Gonsalves said that the production in the region has restarted and ships are loading again. The line of ships waiting to load exceeded 50 before the storm because of existing bottlenecks at the terminal.
BHP Billiton Ltd has also declared force majeure on deliveries while Rio Tinto Group closed 3 mines following the 4 day storm that halted most coal trains from the Hunter Valley, where Xstrata has operations. The Hunter Valley Coal Chain Logistics Team, coordinator of the coal rail system said that coal exports from Newcastle may be cut by more than 2 million tonnes because of the storm and shipments will be disrupted all week for Newcastle which is the biggest export port for coal.
Nickel declines to 3 month low on signs of slowing demand
It is reported that Nickel fell to the lowest in more than three months on London Metal Exchange on signs that demand for the nickel has probably slowed down while its supply increased.
Orders for the nickel to be withdrawn from London Metal Exchange monitored stockpiles dropped by 8.6% to 444 tonne exchange data known as cancelled warrants. This has brought the decline this month to 32%. Nickel inventory has also jumped 90% so far in June.
As per report the metal has lost 11% since June 6th 2007 the day before the LME tightened regulations to ensure stockpiles tracked by the exchange aren’t concentrated on the hands of a few companies
Mr Andrew Silver a trader at Natixis Commodity Markets Ltd said that prices probably will drop further as supplies grows. He said "Current prices are still too high."
Nippon & NYK develop NSGP 1 corrosion resistant plate for crude oil tankers
It is reported that Nippon Steel Corporation and Nippon Yusen Kabushiki Kaisha have jointly developed a highly corrosion resistant steel plate, named NSGP 1 to prevent corrosion of the inner bottom of crude oil tanks of supertankers and that NYK has decided to use this steel plate on all new tankers including on five supertankers on order from IHI Marine United Inc and Imabari Shipbuilding Co Ltd.
Nippon Steel, during the process of development, successfully simulated an environment in which salt water accelerates the corrosion of the bottom of the tank and discovered that the types and amounts of alloying elements that should be combined to create a highly corrosion resistant steel plate suitable for oil tanks.
To ensure the feasibility of the steel plate the two companies used it on the tank bottom of Takamine a supertanker built in 2004 by Mitsubishi Heavy Industries Ltd. Two and a half years later, a regular inspection showed that the steel plate which was free of any anticorrosion coating and was capable of preventing the occurrence of pits.
As per report, by using NSGP 1 for crude oil tanks anticorrosion coating becomes unnecessary as do coating agents and volatile organic compounds. For this reason this steel plate will make it possible to eliminate expenses for coating agents used for building or maintaining oil tanks and will greatly contribute to creating environmentally friendly ships. Conventionally a defective or degraded coating could hasten the corrosion of a tank but such a problem will never occur when the new steel plate is used. This will help to greatly improve the safety and reliability of marine vessels.
Building oil tanks using this steel plate requires no special management because conventional steel welding and processing techniques can be used.
Newcastle Port resume coal shipments
It is reported that Australia’s Newcastle port has resumed shipments following severe storms that forced its closure last week.
Mr Keith Powell a Newcastle Port Corp spokesman said that three vessels, including 2 bulk coal carriers have set sail with 55 vessels waiting to load coal at anchor off the port and a further 9 about to arrive.
Meanwhile, Port Waratah Coal Services, which runs coal loading operations at Newcastle, said that trains from coal mines in the Hunter Valley have not been able to make deliveries due to track damage and they are trying for earliest resumption of rail operations.
ArcelorMittal and Laiwu’s deal deadline extended
It is reported that Chinese steelmaker Laiwu Steel Group has extended a deadline for selling a 38.41% stake in its subsidiary Laiwu Steel Corp to ArcelorMittal while the deal awaits regulatory approval. Laiwu and ArcelorMittal have agreed to extend the deadline for the deal to December 31st 2007 and again to March 31st 2008 if the deal appears to be close to completion.
Interfax China quoted a Laiwu Steel Corporation official as saying that ArcelorMittal's stake acquisition in Laiwu Steel Corporation has been postponed through the extension of the purchase agreement's validity period, as consensus is yet to be reached on the deal.
Chinese authorities have given no reason for the delay in deciding on ArcelorMittal's purchase. But concern about foreign companies gaining control of Chinese companies has increased amid complaints the country might be selling assets too cheaply.
Rhizao ink iron ore purchase agreement with Mount Gibson
It is reported that Rizhao Iron and Steel Group Co Ltd has entered into an agreement with Australian listed Mount Gibson Iron Ltd to purchase up to 2.4 million tonnes of iron ore annually.
Under the agreement, Rizhao Steel will purchase iron ore from Mount Gibson's two iron ore projects amounting to 1.5 million tonnes from Koolan Island and 900,000 tonnes from Tallering Peak annually.
In addition to the Mount Gibson agreement, Rizhao Steel signed a 10-year off take agreement with OneSteel in April. The agreement states that OneSteel will supply Rizhao Steel with 6 million tonnes of iron ore over the next 10 years commencing on July 1st 2007.
Shangdong based Rizhao Steel was jointly established in 2005 by the Laiwu Iron and Steel Group, Jinghua Chuangxin Group Co Ltd and Hong Kong based Yunjin Development Co Ltd. Rizhao Steel produces 3 million tonnes of steel products per annum.
Mount Gibson is an emerging force in the Australian iron ore industry and established in Perth in 1996 and listed on the Australian Stock Exchange in 2002, the Company owns and operates the 3 million tonne per annum Tallering Peak Hematite Mining Operation in the Midwest region of Western Australia, approximately 175 kilometers east of the port city of Geraldton. The Company also owns the Extension Hill DSO Hematite Project in the Mt Gibson Range, 260 kilometers east south east of Geraldton where technical and financial feasibility studies are well advanced and mining is likely to begin in 2007 pending various environmental approvals.
ArcelorMittal announces a new share buy back plan
ArcelorMittal announced its intention to start a share buy back program for up to a maximum of 27 million class A common shares, immediately following the completion of its current USD 590 million buy back program.
Arcelor Mittal said that this new share buy back program is aimed at offsetting the issuance of 27 million ArcelorMittal shares that will take place in connection with ArcelorMittal's mandatory tender offer for Arcelor Brasil on June 26th 2007.
The release added that “Further details on the new share buy back program will be disclosed by ArcelorMittal in a press release that will be published before its commencement.”
Corus announces wire rod price hike for third quarter
Corus has announced that it will be increasing UK wire rod prices for the third quarter 2007 applicable to deliveries from the July 2nd 2007 by at least 7%.
Corus release said that “Steel markets have remained buoyant throughout 2007 and the upward momentum in long products sectors has been driven by construction activity. Continuing improvement in economic sentiment has been evidenced by robust demand for wire rod products across Europe. Energy costs and scrap prices are at historically high levels and are expected to remain so, while other costs including iron ore and logistic costs have increased through 2007.”
CCCMC calls Chinese tube makers to discuss AD move in US
It is reported that China Chamber of Commerce of Metals Minerals & Chemicals Importers & Exporters will convene a meeting in Beijing soon to discuss the recent filing of unfair trade cases against standard Chinese pipe imports by US mills.
As per report, more than 20 Chinese pipe makers mainly from coastal regions like Shandong, Guangdong, Hebei and Zhejiang will be present at the conference.
US welded pipe producers filed unfair trade cases against standard pipe imports from China, alleging dumping margins as high as 88% as well as countervailable subsidies. Petitioners include Ipsco Tubulars Northwest Pipe, Sharon Tube and the United Steelworkers union. The US International Trade Commission will make a preliminary injury ruling on both the subsidy and dumping complaints by the end of July 2007.
(Sourced from MySteel.net)
Mitsui acquires 19.9% of Sims
Mitsui & Co Ltd announced that it has completed its acquisition of approximately 19.9999% of the issued ordinary shares of Sims Group Limited from Hugo Neu Corporation for approximately AUD 605 million in accordance with the share sale agreement entered on March 30th 2007.
Mitsui has the right to nominate two directors one of whom will be independent to the board of directors of Sims subject to approval by the board nomination committee.
The release added that “Mitsui recognizes scrap recycling as the industrial solution to environmental problems and has set scrap recycling as one of its key businesses in its medium term management outlook. Mitsui wishes to enhance the business of scrap recycling through this acquisition.”
Sims is one of the world's leading scrap metal recycler with 120 sites across four continents.
Tokyo Steel orders a two strand slab caster
It is reported that Japan’s Tokyo Steel Mfg Co Ltd has awarded SMS Demag an order to supply a two strand slab caster for the works at Tahara in Japan, which is a Greenfield project and is the 5th production facility of Tokyo Steel. Its commissioning is scheduled for 2009.
The slab caster is designed for an annual production of 2.4 million tonnes of steel slabs. It is a vertical bending plant, constructed with 16 segments for a metallurgical length of 35 meters, and it will attain a maximum casting speed of 2.2 meter per minute. The new facility will be used predominantly for casting ULC and IF grades as well as low and medium carbon grades.
Under the contract SMS Demag will supply the complete engineering and all of the mechanical and electrical components from the ladle turret to the run out roller table.
The package include technologies which have an essential influence on quality such as dynamic Soft Reduction, variable spot cooling, quenching and dynamic solidification control with air mist secondary cooling and a width dependent spraying system to achieve homogeneous internal quality of the slabs. The supply scope also includes the mold with hydraulic resonance oscillation and the mold monitoring system. The X Pact electrical and automation systems, including the process models, training of the customer’s personnel and supervision of erection and commissioning are also in the scope of the contract.
Alam Steel to open new rebar processing factory in Dubai
It is reported that Alam Steel Industry’s USD 8.7 million (AED 30 million) rebar processing factory for producing pre cut and bend steel products at Dubai Investments Park in UAE will be inaugurated by Mr Khalid Kalban CEO of Dubai Investments on June 21st 2007.
The plant is spread across 25,000 square meters and has a production capacity of 300,000 tons a year. Alam Steel has set up 3 new production lines using Germany’s Stema Pedax machinery including a pocket system that reduces crane usage through the production line, greatly improving productivity.
The lines accurately processes rebars as per the specifications of the structural drawings and delivers rebar correctly labeled and ready to be fixed at the client's site. It also has automated rebar pile cage machinery that can produce 12 meter long cages up to 2 meters in diameter. Each machine is capable of producing a rebar cage every 30 minutes.
Mr Vikram Bhatia director of Alam Steel Ltd said that "The rebar facility will compliment our existing businesses and is part of our strategy of moving up the steel value chain."
Alam Steel supplies fabricated reinforcing steel bars from 8mm to 50mm in diameter in deformed high yield steel as well as epoxy coated material. The machinery processes rebar off site in a purpose built facility as per the specifications of the structural drawings and delivers rebar ready to be fixed at the client's site.
Alstom to build power plant for ThyssenKrupp CSA Companhia Siderúrgica
It is reported that power & rail infrastructure major Alstom has received a EUR 330 million turnkey contract from Brazilian steel producer ThyssenKrupp CSA Companhia Siderúrgica to build a 490MW turnkey combined cycle power plant.
The power plant, to be located in Rio de Janeiro, will be fuelled by blast furnace waste gas from a new steel mill, which will be built in parallel by the customer, with excess energy exported to the national grid. The project will be carried out in 2 phases, with the plant operating in simple cycle first, allowing power to be produced early on in the project. In the second phase, further equipment will be added to give full combined cycle operation.
Alstom will provide all engineering procurement and construction services to deliver a fully integrated blast furnace gas fired combined cycle plant including balance of plant, civil works and erection. The power plant will integrate in house core plant components consisting of 2 GT11N2 gas turbines, heat recovery steam generators, 1 steam turbine and 3 turbo generators.
Mr Philippe Joubert president of Alstom power systems said that “Using gas that would otherwise be wasted to produce power is both of economic and environmental benefit. Alstom has a range of power solutions which can help industry reduce emissions and maximize commercial value.”
China Steel Research and Technology Group inaugurated
China Knowledge reported that China Steel Research and Technology Group were established on June 10th 2007 at Diaoyutai in China. China Steel Research and Technology Group is a JV between Central Iron and Steel Research Institute and Automation Research and Design Institute of Metallurgical Industry.
The JV was approved by the State Owned Assets Supervision and Administration Commission of the State Council for strengthening metallurgical research in China. The JV aims at a higher level of technology innovation and competitiveness within the industry and as the central research group it will enhance the current restructuring in the industry in China.
Central Iron and Steel Research Institute is the leading metallurgical research organization in China with talented professionals in the areas of materials science and metallurgy process engineering. CISRI has concluded about 4000 items of scientific research.
Automation Research and Design Institute of Metallurgical Industry focuses on the metallurgical information and automation technologies with 3 research facilities Center for Metallurgical Automation Engineering, Metallurgical Automation Productivity Promotion Center and Metallurgical Automation Innovation.
Voestalpine shareholders deny buying stake in Boehler Uddeholm
Thomson Financial reported that Voestalpine AG's main shareholders have denied media reports suggesting they may have been purchasing shares in Boehler Uddeholm AG with the aim of assisting the Austrian steel conglomerate raise its stake in Boehler Uddeholm above the 54.6% it already owns.
The Austrian Broadcasting Corporation reported that voestalpine shareholders Oberbank, Raiffeisenlandesbank Oberoesterreich, Energie AG and Linz AG had all separately stated they had not purchased Boehler Uddeholm shares and had no intention of going so.
SSAB and IPSCO announce expiration of Hart-Scott-Rodino Waiting Period
IPSCO Inc and SSAB Svenskt Stal AB have announced the expiration of the waiting period under the Hart Scott Rodino Antitrust Improvements Act of 1976, as amended, in connection with the proposed plan of arrangement pursuant to which IPSCO would be acquired by SSAB for a cash consideration of USD 160 per share.
The expiration of the Hart Scott Rodino waiting period satisfies one of the conditions to SSAB's acquisition of IPSCO.
The release added that “Consummation of the plan of arrangement, which is expected to occur in the third quarter of 2007, remains subject to other customary closing conditions, including approval of the plan of arrangement by IPSCO's shareholders and obtaining certain regulatory approvals.”
IPSCO operates steel mills at 3 locations and pipe mills at 8 locations in the United States and Canada. IPSCO is a low cost North American steel producer, and 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 oil and gas well casing and tubing, line pipe, standard pipe and hollow structural. Steel can also be further processed at IPSCO's 5 temper leveling or coil processing facilities.
SSAB is a Swedish based publicly traded corporation with a leading European position in Quenched & Tempered heavy plate and EHS/UHS steel sheet. It comprises 4 divisions like Division Sheet and Division Heavy Plate are the steel operations with steel shipments of 3.1 million tonnes in 2006, Plannja is a processing company in building products and Tibnor is its trading arm supplying a broad product range of steel and metals. It has sales revenues of almost USD 4.6 billion.
Rio Tinto assessing damage by heavy rains to coal operation in Hunter Valley
It is reported that Rio Tinto Plc is still assessing the extent of the damage caused by heavy rains on its operations in Australia's Hunter Valley coal mining district namely Mount Thorley Warkworth, Bengalla and Hunter Valley operations through its unit Coal & Allied Industries Ltd.
A Rio Tinto spokesman said that “We are in the process of assessing the impact of the storm on our coal mines. Following significant rainfall, water is being pumped from the mines to existing storage dams and the group has not declared force majeure on its coal deliveries.”
BHP Billiton PLC has declared force majeure on thermal coal shipments from Newcastle port because of flooding. BHP also operates the Mount Arthur mine in the Hunter Valley which produces about 10 million tonnes of coal every year.
IMS finalizes acquisition of Cotubel Group
It is reported that International Metal Service and the Marcegaglia group have finalized the acquisition of Cotubel group by IMS and that the acquisition has received the approval of the German antitrust authorities.
The report added that the acquisition, financed by cash, will enable IMS to increase its presence on the stainless steel tube and fittings segment and to reach new distribution channels.
Cotubel group recorded turnover of approximately EUR 90 million and distributed about 18 000 tonnes of steel in 2006. It employs 160 people in France through Trdinox, in Belgium through Cotubel, in Switzerland through Trinox, in Germany through Asadin and in the Netherlands through Noxon.
Portman’s Q1 profit up by 72% YoY
Australia’s 3rd largest iron ore mining company Portman Ltd announced that its first quarter profit rose by 72% YoY as it shipped more of iron ore at higher prices.
Its net income rose to AUD 28.9 million for January to March 2007 as compared to January to March 2006 and sales rose by 53% YoY to AUD 128 million from AUD 84 million in January to March 2006. It sold 1.9 million tonne of ore in the quarter.
Portman is a unit of Cleveland-Cliffs Inc. It expects to produce 8.4 million tonnes of iron ore this year and sell 8.3 million tonne.
Bolivia to raise income tax by 37% on mining sector
According to Bolivian press reports Mr Evo Morales president of Bolivian has presented a bill which aims to raise income taxes on the mining sector from 25% to 37% in order to boost the state's budget.
The report said that by raising income tax on mining companies, the Bolivian government plans to receive USD 150 million per annum for the budget, whereas this tax represented only USD 45 million in 2006.
The report added that this bill, which will be submitted to the Bolivian parliament soon, will not apply to private and family mining co operatives. It will cover the mining of iron, boron, precious and semi precious stones, antimony, tungsten, copper, bismuth, indium and rhenium. The tax will apply only when the mining of international metals exceed a threshold fixed by the Parliament.
If it came into effect, this new tax would affect companies such as the US' Apex Silver, Coeur D'Alene, American Silver Corp, Newmont, India's Jindal Steel and Power India, and Switzerland's Glencore.
Bolivian ore exports brought USD 1 billion to the mining groups in 2006.
New billet and rebar mill to come up in Abu Dhabi - Report
YIEH reported that a new 500,000 ton steel plant will be built in Abu Dhabi for producing billet and rebars. It is scheduled to come on stream by 2010.
As per report, 2 South Korean companies with each will have a share of 30% and 5% respectively and an Abu Dhabi local firm will take a stake of 65%.
One of the South Korean firm Dsec Co Ltd is a subsidiary of Daewoo Shipbuilding & Marine Engineering and will be responsible for construction and engineering needs.
Mr Claude reelected as Chairman of Saarstahl
It is reported that Mr Claude Kintz has been reappointed as a member and chairman of the board of management by the supervisory board of Saarstahl AG in a meeting which took place on June 6th 2007 for the period until March 2009.
Mr Kintz has been a member of the board of management since March 1996 and has been Chairman of the board of management of Saarstahl AG since March 2005.
Comprehensive report on Indian steel sector
The Indian steel industry is poised for massive expansion. Dramatic consumption growth over the last few years has stimulated enormous expansion plan, facilitated by unexploited iron ore raw material base. India is now being hailed as the new China, where crude steel production soared from less than 100 million tones in 1995 to over 400 million tones in 2006.
Indian crude steel output at just 38million tonnes in 2005 is starting from a much lower base, and the economic steel- consuming structure of China is substantially different from India. Nevertheless, India has recently established a long-term goal of raising crude steel production to 100 million tonnes per annum by 2020.
UK based GFMS Metals Consulting in an innovative way and value for money report on Indian steel industry includes complete statistical coverage of the industry, an unbiased and frank assessment of growth expectations, a base case outlook for each steel product & the industry as a whole with a clear view of potential risks, an assessment of raw material availability and trends and production, trade and consumption forecasts out to 2011.
The report coverage includes historic production, trade & apparent consumption of carbon steel both long and flat products, raw materials, producers, economic environment, political and other risk factors.
If you are interested to know more about it please visit GFMS Indian Steel Report or send a mail at research@steelguru.com
