July, 01 2007
Welspun to build a pipe plant at Little Rock in Arkansas US
Welspun Gujarat Stahl Rohren Limited has announced plans to build a manufacturing facility on a 740 acres site adjacent to the Little Rock Port Authority at Little Rock in Arkansas State of US. The USD 100 million facility, once completed, will be capable of producing 300,000 net tons of tubular steel pipes annually for use in the oil and gas industry and is scheduled to begin production by spring 2008.
Mr Mike Beebe governor of Arkansas said “This is a great day for Arkansas. Welspun could have chosen many other locations for their investment, and they chose Arkansas. Our workforce, infrastructure, and the natural benefits of the Arkansas River convinced Welspun to become our partners in progress. We welcome these great manufacturing jobs.”
Mr BK Goenka vice CMD of Welspun Group said “We are happy to be here at Little Rock today, which has the advantage of a talented workforce, the right transportation opportunities, and above all, the right geographical location. We look forward to a long and prosperous future as partners in Little Rock.”
Mr Bajra Mishra CEO & ED of Welspun Gujarat Stahl Rohren Limited said “Since our inception, we have ventured into unexplored territories and have emerged as global leaders. Today, after setting our foot in Arkansas, we hope to continue to prove our engineering excellence and be a comprehensive provider for state-of-the-art Pipes and related niche products for the transportation of Oil and Gas.”
Earlier this month, the Arkansas Economic Development Commission approved a USD 5 million guarantee on an industrial development bond for a Welspun plant.
POSCO project hampering education for children in Orissa
SNS last week reported that all schools in the proposed POSCO project area wear a deserted look as academic activity has come to a standstill due to the observance of protest week by the POSCO Pratirodh Sangram Samiti, which has also involved school children in the movement. There are 5 primary schools and two high schools in POSCO affected Dhinikia, Nuagaon and Gadakujang panchayats under Erasama block.
A student of Patana village said he had not gone to school for the past ten days and was enjoying his role in the protest week. Other children who were active in the movement said the choice was between attending school now and losing the entire school to the project forever.
6 months ago that school children and students took to active involvement in the movement. They had also petitioned all concerned voicing their concern over livelihood of their parents and their future. Education is severely affected in all these schools for the past one and half years, ever since the agitation against the proposed projected took shape.
PSL setting up pipe plants close to customers
Reuters last week reported that steel pipe maker PSL Limited as saying that PSL has plan to enter the Chinese market and is in talks with two firms to set up a manufacturing unit in China. PSL's strategy is to address each of the high growth markets by locating a unit in these regions and supplying the market from there.
Mr Atul Punj MD of PSL Ltd told Reuters that the overseas units save on freight cost that makes up about 10% of the total and also saves on delivery time. He added that accordingly PSL, after commissioning its Sharjah unit in UAE and proposed pipe plant in US, is also looking at the high growth markets including Russia and China.
Mr Punj said that "We have had preliminary discussions with two separate organizations in China. PSL plans to use its pipe making expertise and technology and expects its partner to bring local capability, marketing knowledge and help in interface with local authorities. The investment in the Chinese project would be about USD 60 million.”
E-auction of coal to be recommended by expert committee
Times News Network last week reported that e-auction of coal may soon restart as the committee formed by the government to evolve a policy for coal distribution has found e-auction a suitable system for determining market price of the fuel and is likely to submit its report in favor of the e auction of coal soon.
The report cites Mr Gupta secretary coal as saying that “We are giving final touches to the report. It will be submitted to the ministry in two weeks.”
The report added that “The committee will suggest introduction of floor prices for e-auction instead of a reserve price, which was the practice earlier. The present system of e-booking has limitations. Buyers end up getting just 50 tonnes. Further, the system is dependent on availability of a broadband connection, which is not common in non metros.”
The committee was formed under the chairmanship of Mr HC Gupta following the Supreme Court’s direction to temporarily discontinue e-auction.
Teesta persons continue hunger strike against hydel projects
It was reported last week that the talks between persons of Teesta effected by various hydel power projects in the area and Sikkim government ended inconclusively even as the indefinite hunger strike by protestors crossed a weeklong period.
The meeting held recently at the secretariat in Gangtok failed to reach any consensus and the protestors reiterated that they would continue with their agitation.
Mr Lepcha president of Affected Citizens of Testa said that "Our concern is to save Sikkim's environment, our forests, and the ecology in the Khangchendzonga National Park and the Khangchendzonga Biosphere reserve. We have demanded that the state government furnish us with certain documents regarding power projects planned in Dzongu in order to initiate further talks. We have been assured by the government that all the required documents would be provided to us by June 28th 2007. Only after this will we consider having a dialogue with the Government."
Members of Affected Citizens of Teesta, supported by Lepchas of Sikkim and the Sangha of Dzongu and other organizations are on an indefinite hunger strike against the sanctioning of mega hydel power projects in the state, especially in North Sikkim. They want all hydroelectric power projects in Dzongu in North Sikkim scrapped and others in the state reviewed.
Gujarat tops in steel pipe production-CM
Mr Narendra Modi CM of Gujarat during a foundation laying ceremony for the 4.5 million tonnes per annum cement plant and 120 MW thermal power plant to be set up at a cost of INR 1250 crores in Kutch said that Gujarat has topped in the production of cement and steel pipes.
Mr Modi said that infrastructure development is essential for industrial growth and although Kutch district lacks in this field it tops in manufacturing cements and steel pipes in the world.
Mr Modi said that industrial investment of INR 75,000 crore is in the pipeline for Kutch despite of discontinuation of tax incentive by the union government offered after the massive 2001 earthquake.
As per Mr Modi’s vision, most backward Abdasa and Lakhpat tehsil of Kutch district will be fully vibrant after 10 years with many new cement and thermal power stations based on lignite and imported coal being made available in the area. Mr Modi added that Kutch would produce over 10,000 MW of electricity in the next 10 years.
Rohit Ferro Tech to set up one more ferrochrome furnace
Rohit Ferro Tech Limited announced that its board had approved an investment of INR 14.13 crore to set up a 15,000 tonnes per annum new furnace at Bishnupur in the state of West Bengal that would raise its total ferrochrome capacity to 180,000 tonnes per annum.
The new fifth furnace project will be funded through a bank loan of INR 8.48 crore and the balance CAPEX shall be met through internal accruals.
Rohit Ferro Tech Limited was incorporated on April 2000 under the aegis of Impex Group having interest in manufacturing, trading, import & export of various kinds of ferroalloys Rohit Ferro Tech Limited started its operations in October 2003 with a ferroalloy plant comprising of 2x9 MVA Submerged Arc Furnaces in WB and then expanded it’s capacity by installing further 2x9 MVA furnaces to produce 55,000 tonnes per annum of HC ferrochrome. Subsequently another furnace of 9 MVA was added. It has also set up another ferroalloy plant comprising of 4 x 16.5 MVA Submerged Arc Furnaces at Kalinga Nagar Industrial Complex at Jajpur in the state of Orissa to produce 110,000 tonnes per annum of ferroalloys comprising of HC ferrochrome, silicomanganese and ferromanganese.
Ankit’s integrated steel plants nearing completion
Projects Today recently reported that an integrated steel plant project of Ankit Metal & Power Ltd at Chhatna in Bankura district of West Bengal is nearing completion.
The new integrated project, being implemented over 3 phases with a total investment of INR 122 crore, involves setting up a 350 tonnes per day of sponge iron unit in phase I. A steel melting shop with a capacity of 65,140 tonnes per annum, 0.1 million tonnes per annum re rolling mill and an 8.5MW captive based power unit in phase II. In phase III, the captive unit capacity will be enhanced by 4MW.
Meanwhile, Ankit's other integrated steel plant at Jorehira in Bankura district is expected to start commercial production in July 2007. The INR 129 crore steel project involved the setting up of a 350 tonnes per day sponge iron plant, 65,000 tonnes per annum steel billet unit, 0.1 million tonnes per annum rolling mill and a 12.5MW waste heat based captive power plant.
West Bengal’s Duston & Engineers is the civil contractor and Avante Garde is the consultant for the project. The sponge iron unit has already commenced production activity.
Dhamra Port may seek service tax exemption on dredging
BL reported that TATA Steel and L&T’s JV Dhamra Port Company Limited is planning to approach the union finance ministry with an appeal for granting of exemption to dredging services from the payment of service tax.
A spokesman for Dhamra Port said that "If the construction of ports, roads and other infrastructure projects could be exempted from the purview of service tax, there is no reason why dredging, an integral part of any port construction, should not be treated the same way."
He said if the Government for some reasons could not exempt the entire gamut of dredging services from the payment of service tax at least capital dredging, forming a substantial part of port construction, should be considered. The spokesman pointed out that the cost of dredging was usually very high, largely due to the absence of competition.
The dredging services were brought under the scope of service tax with effect from June 16th 2005.
Dhamra Port Company would be required to spend more than INR 600 crore on dredging, covering both capital and reclamation dredging as part of the construction of the new port.
PTC to evacuate power from Goa Energy's power project
It is reported that Power Trading Corporation of India is planning to evacuate power from Goa Energy's 30MW based on industrial waste heat recovery from Sesa Goa's coke oven plant in Goa.
As per report, PTC will evacuate power for 25 years from the INR 130 crore proposed project and is the first such long term agreement for evacuation of power generated from an industrial waste project.
The project to be set up at Navelim in north Goa will use heat available in waste gases generated during operations of Sesa Goa's coke oven facilities and pig iron facilities to produce the superheated steam capable of generating 30MW power.
POSCO to leverage FINEX technology to gain stakes in Chinese steel makers
South Korea's Chosun.com, in a report said that POSCO is considering sharing its newly developed commercial steel furnace technology called FINEX to China in return of stakes in Chinese steel mills, which are otherwise closely guarded.
The report cites a POSCO executive as saying that "Several Chinese companies have asked that we export the FINEX technology. We have asked them to submit official proposals to define the possible collaboration. Some have sent proposals and others have promised to send them."
Incidentally, China had sent 68 members delegation comprising of official from the commerce ministry and Chinese steel makers to the dedication ceremony of POSCO's FINEX plant in Pohang on May 29th 2007.
At the dedication ceremony, POSCO said that it had no plans to export the technology to overseas companies unless they were willing to allow POSCO right of management. Industry figures believe that POSCO is now making steps to secure management of Chinese steel firms, long one of the POSCO's aspirations, by leveraging its new technology. And now, POSCO could possibly deliver the FINEX system to Chinese steel makers if they in return provide enough shares to POSCO to give it control although present Chinese regulations currently forbid foreign ownership of local steel companies.
FINEX can use low quality iron ore, which is abundant in China and it produces just 1% to 3% of the pollutants like sulfur oxides and nitrogen emitted by conventional furnaces.
Mr Löscher takes over as CEO of Siemens
Mr Peter Löscher takes over as president & CEO of Siemens as of July 1st 2007 succeeding Mr Klaus Kleinfeld, who became 11th CEO of Siemens in their 160 year old history on January 27th 2005.
Mr Löscher began his professional career at the German management consultants Kienbaum & Partner and was active in a variety of functions at Hoechst and Aventis in Germany, the US, Spain, Great Britain and Japan. In 2002, he moved to the UK healthcare technology company Amersham and following its acquisition by General Electric joined the GE Corporate Executive Council. Since 2006, he was member of the Executive Committee at Merck & Co in the US, one of the world’s leading American pharmaceutical companies.
Mr Gerhard Cromme chairman of supervisory board of Siemens said “I thank Klaus Kleinfeld for his tireless dedication to the company. Most notably, he laid the foundation for today’s business success with his strategic realignment of the company. Now, I look forward to working with Peter Löscher, who can build on this strong base.”
Mr Löscher said “It is a great pleasure and honor for me to lead Siemens as its CEO. Together with the well more than 400,000 employees, I would like to achieve a great deal in the coming years. In the past weeks, I have been intensively preparing myself for this assignment.”
Mr Klaus Kleinfeld the outgoing CEO said “I leave with many fond memories of the people who make Siemens such a great company. I hope that the success of Siemens’ employees will continue and wish my successor in particular all the best on this road.”
ConsMin rejects Territory bid and backs Pallinghurst offer
It is reported that Consolidated Minerals Limited said that an AUD 850 million counter bid for the company by Territory Resources Ltd lacks vision and that it has backed a sweetened offer from Pallinghurst Resources.
Mr Dick Carter chairman of Consmin said that pursuing the Territory proposal would have created significant risk and uncertainty for shareholders as it had significant concerns about the Territory offer and its lack of strategic vision and certainty.
Mr Carter said "The board believes that pursuing a proposal with Territory Resources would create significant risk and uncertainty for Consolidated Minerals shareholders. The proposal requires our shareholders to accept Territory Resources scrip, at a price which the board believes does not reflect Territory's underlying intrinsic value."
Mr Carter said "Given the concerns of the Territory bid, the board believes it is in the best interests of Consolidated Minerals shareholders to continue to pursue existing strategies and move forward with the scheme proposal involving Pallinghurst Investor.”
Territory launched its AUD 850 million counter bid for Consmin on Thursday, with backing from commodity traders Noble Group, DCM DECOmetal International Trading and investment bank Lehman Brothers. Territory, which operates the modest Frances Creek iron ore mine in the Northern Territory, is offering AUD 1.50 in cash plus 1.5 Territory shares for every ConsMin share.
The Pallinghurst Investor consortium is comprised of Pallinghurst Resources, US based coal company AMCI and merchant bank Investec. Its sweetened bid of AUD 1.68 in cash for every ConsMin share plus two shares in the new ConsMin would mean that it would will pay AUD 382 million for a 60 per cent controlling stake in a new ConsMin.
Stelco unlikely to be bought at current price - Scotia Capital
According to Mr David Tyerman an analyst of Scotia Capital the chance that Stelco Inc will be bought at its current share price of about USD 28.67 is quite low.
Mr Tyerman in his latest report on Stelco Inc said that “We still think there is a low probability that Stelco will be purchased due to legacy costs other possibly more attractive acquisition candidates, Stelco’s current high share price and its shift to a lower value added product mix.”
He added that Stelco has more than a few obstacles standing in the way of a sale. Mr Tyerman said that “We expect a moderate rebound in profitability at Stelco in the remainder of 2007 as current prices are stronger than early 2007 prices. Stelco should also benefit from cost reductions from facilities rationalization and lower metallurgical coal prices.”
Earlier Ontario based Stelco that it would explore alternatives to become part of a larger company.
Ferrochrome price surge by 20% QoQ
JMB reported that ferrochrome price quarterly negotiation was concluded to increase by 20% in Europe for July to September 2007 over prices for April to June 2007. The price renews the record high for 2 consecutive quarters.
The ferrochrome price hike represents JPY 8,800 per tonne of higher cost for stainless steel products with 18% chrome.
Ferrochrome spot market price surge is partially due to Chinese aggressive purchase along with worldwide stainless demand increase.
Mittal Steel SA start construction of 2 DRI kilns at Vanderbijlpark
It is reported that Mittal Steel South Africa has began construction of two new DRI kilns at its Vanderbijlpark plant at a cost of ZAR 600 million to increase its liquid steel capacity by around 250,000 tonne per year under its ZAR 9 billion capital expenditure program to increase its liquid steel production.
As per report, the DRI kiln project started on March 29th 2007 and will take 62 weeks to complete. Upon completion it will increase the number of kilns at Vanderbijlpark from four to six.
The contract for the construction of the core plant, consisting of the kilns and coolers, the after burner chambers, dust settling chambers, electrostatic precipitators, and the raw handling was awarded to BGRIMM, a Chinese specialist construction firm. Group Five will be responsible for all the civil work. However construction for the building of the associated power plant has been awarded to APT of India. Karrena Africa will undertake the construction of the 100 million stack used for releasing treated gas into the atmosphere. The services required for the plant, which include water, gas, oxygen pipelines, and cooling towers for the process water, will be constructed by Industrial Water Cooling South Africa.
Steel imports in Pakistan in 2007 declines
Pakistan Daily Times reported that the import of iron and steel into Pakistan has remained quite low in 2007 so far as compared to 2006 due to high international price levels, which have dampened local demand forcing the Pakistani importers of steel to reduce their imports. Another reason for the decline in imports is that the importers had large carryover stocks from the last financial year, which took time to be sold.
In 2007 so far, Pakistani importers have imported iron and steel worth USD 1.087 billion lower by 12%YoY as compared to imports of USD 1.237 billion in 2006. It has also imported iron and steel scrap worth USD 321.643 million, which is down by 2.5% YoY to USD 329.919 million in 2006.
Importers told Daily Times that they did not place any order for import after the announcement of the budget due to enhanced rate of sales tax. As the issue is settled now, imports are likely to resume. However, it is expected that the demand for iron and steel as well as other building material would surge this year, as the government has allocated PKR 520 billion for Public Sector Development Program, which includes construction of water reservoirs.
Pakistan’s iron and steel import had risen sharply in 2006 as the importers brought in huge quantities anticipating large demand from the areas devastated by earthquake. The government has planned to build such houses in those areas now that would consume more steel and less cement, as these would be relatively safer from earthquakes. The import of iron and steel in the country had risen very high late last year and in the beginning of the current calendar year in anticipation of large-scale reconstruction activities.
The value of iron and steel import in 2005-06 stood at USD 1.338 billion, which was up by 50.33% YoY compared to USD 890.167 million in 2004-05.
RZhD to create Russia's largest freight company
FIS reported that the directors’ board of Russian railways OJSC approved a package of documents on the development of First Freight Company OJSC.
Preliminary estimates show that the First Freight Company will be worth of about USD 5 billion. The company is to enter the stock market by 2009.
UAE cement makers may switch to coal on gas scarcity
Reuters reported that cement makers in the UAE are turning to imported coal to fire their furnaces as gas is becoming scarce and the petrodollar fuelled building boom shows no signs of letting up.
The construction sector has a double hunger for coal, used as both a kiln fuel for cement making and a raw material in the process. While the UAE has bought small amounts of coal during the past 5 years, cement makers in Ras Al Khaimah and Fujairah are now asking for more.
In Ras Al Khaimah some companies have already imported coal from South Africa to burn in furnaces, while others are thinking of making the switch. Mr Ruurd Abma COO of Ras Al Khaimah Gas Company said that "The companies are having to spend USD 10 millions on this. They do need the coal. We are going through a tough summer for gas, just as we did last year." He added that Ras Al Khaimah Cement Company is carrying out a feasibility study on switching to coal from gas but hopes that the gas supply will remain sufficient.
Producers and traders said that demand for South African coal for loading between July and December 2007 is unlikely to be more than a few hundred thousand tonnes at most. But, given the tightness of availability for the balance of the year and likelihood of continued strong demand from the Indian subcontinent and revived European demand in the autumn, even a small increase in UAE demand could push prices higher. The said that offer prices for South African coal cargoes have risen to USD 60.00 a tonne FOB Richards Bay from USD 47.00 in January on the strength of unexpectedly high Indian demand.
Malaysia Steel Works aiming at MYR 500 million revenue in 2007
Mr Tai Hean Leng MD & CEO of Malaysia Steel Works after the company Annual General Meeting told reporters that Malaysia Steel Works expects its revenue to grow to about MYR 500 million by the end of 2007 driven by high demand and increase in steel prices. Mr Tai said that he was confident of the target as the group’s turnover had touched MYR 250 million by mid 2007.
Masteel's capacity had risen due to increased investments in the last two years. Mr Tai added that Malaysian steel industry is expected to benefit from the positive growth and rebound of the construction industry. The construction sector is projected to turn around this year to register a growth of 3% against a contraction of 0.5% in 2006.
Masteel’s net profit rose to MYR 30.01 million for the financial year ended December 31st 2006 from MYR 23.3 million in financial year 2005. Its revenue also rose to MYR 362.22 million from MYR 306.4 million in 2006.
Thermal coal prices jump by 17.5% in June in US
Purchasing.com reported that with electrical generation expanding in early summer, Central Appalachian coal prices have increased by USD 7 per tons in the past month to USD 47 per ton in US and that imports are high already averaging USD 67 per ton.
YTD through June 16th 2007, US’s electricity generation was 1,803,747 GWH up by 3.3% YoY as power generation coal burn was up from 73.42 million tons in 2006 to 76.097 million tons in April 2007.
Yet, new coal supply is down this year, as US’s Energy Information Administration data shows overall production through May 2007 down by 2.2% YoY. YTD production in Pennsylvania was down by 11.7% YoY, Kentucky was down by 7.8% YoY, and West Virginia was down 6.4% YoY.
Mr David A Lipschitz an analyst with Merrill Lynch suggested that the coal price increase might have been higher. He said that except that coal inventories held by US power generators are at their highest level since June 2002, still, further inflation is possible. He added that “The continued prospect of environmentalist litigation, including mountaintop removal mining challenges and associated reclamation work, serves as a reminder of the significant risk associated with operating in the Central Appalachian region.”
Brazilian flat and long steel makers to report positive Q2 results
An analyst with brokerage Planner Corretora said that Brazilian flat and long steel producers are expected to report positive financial results in the second quarter of 2007 due to strong demand at home.
An analyst said that "I don't see a major difference between the two segments. The need for products from long and flat steel companies is being propelled by civil construction and the automobile industry respectively.” The Planner analyst said "There are no signs of a slowdown in the automobile industry,"
The Anfavea spokesperson said estimates internal vehicle sales could expand 14.5% to 2.2mn in 2007 but the 24% expansion in the first five months of 2007 came as a surprise and another upward revision is expected for next month.
Brazilian long steel producers include Arcelor Brazil, Gerdau and Votorantim Metais, as Arcelor Brazil also produces flat steel, along with CSN and Usiminas.
Gazporm & Eni to South Stream pipeline linking Russia & Italy
Russia's natural gas monopoly Gazprom and Italian energy company Eni concluded a MoU recently to build a gas pipeline linking Russia's Black Sea coast with Italy.
The 900 kilometer long pipeline, called the South Stream, is expected to run from the Beregovaya compressor station in Russia's Krasnodar Region under the Black Sea to Bulgaria and then branch into two stretches via Romania and Hungary to Austria and Slovenia and via Greece to southern Italy. The pipeline's annual capacity is projected at 30 billion cubic meters.
Mr Denis Ignatyev a spokesman of Gazprom said that “The cost of the project and the distribution of stakes among the partners will be decided after the feasibility study, which is currently being done by Italy’s Saipem.” He added that Saipem was also the contractor for the Blue Stream pipeline from Russia to Turkey, also jointly owned by Gazprom and Eni.
The landmark deal comes in the wake of several other accords between Gazprom and Eni. In 2003, the companies jointly launched the Blue Stream gas pipeline which pumps Russian gas to Turkey under the Black Sea. In 2006, Gazprom also signed an agreement to directly supply gas to Italian consumers via Eni's pipelines. In April 2007 Eni purchased some of bankrupt oil company Yukos' assets jointly with Italian energy company Enel and Gazprom concluded an option to buy stakes in those assets.
AK Steel and UAW reach tentative agreement for Rockport Works
It is reported that AK Steel AKS and the United Auto Workers have reached a tentative agreement on a new labor contract covering about 190 hourly production and maintenance employees at the AK Steel's Rockport Works.
As per report the tentative agreement is subject to ratification by Local 3044 members in a vote expected to take place within a week.
The existing contract is set to expire September 30th 2007. The new agreement would run from August 1st 2007 to September 30th 2013. Both the parties agreed to commence early bargaining in the mutual desire to reach a new contract well ahead of the expiration of the existing agreement.
Severstal Metiz to finalize supply contract in Scandinavia
Interfax reported that Severstal-Metiz's dealer in Scandinavia and Poland Anordika is negotiating one year contracts with two major Scandinavian companies.
Severstal said in a statement citing Mr Alexander Zolotarevsky GD of Anordikam said that "We are negotiating one year contracts with two new clients some of the biggest Scandinavian pulp producers."
Pakistan Steel importing coal due to faulty oven batteries
Pakistan Media reported that due to fault in coke oven batteries for the last couple of years, Pakistan Steel Corporation has reduced imports of coking cola and has increased import of coke. As per report, Pakistan Steel Corporation has imported about 0.5 million tonnes of metallurgical coke to keep the production of steel going.
The report cites a source as saying that the faults had existed in the batteries for quite some time but the management was not allowed to incur heavy expenditure in getting it removed in view of Pakistan Steel's privatization.
There is a big difference in the price of coal and coke. Coke is about 2.5 times expensive than coal.
Alpha purchase of Mingo Logan Ben Creek coalmine completed
Abingdon based Alpha Natural Resources Inc announced that it has completed a definitive agreement with St Louis based Arch Coal Inc to acquire their Mingo Logan Ben Creek complex in Mingo County in an asset purchase with an investment of USD 40 million.
Alpha said that Ben Creek Complex consists of 2 mines, a railroad loading facility and prep plant in Mingo County and the deal also includes approximately 9.2 million tonnes of coal reserves. The purchase price also includes adjustments for working capital.
Production from the Creek Complex is expected to fall sharply. Its Mountaineer Alma longwall mine produced more than 2.2 million tonnes in 2006 but when the sale was announced earlier this month, Arch said that it expected the longwall operation to run out of coal by the end of June 2007.
Alpha also plans to operate mountaineer as a 3 section mine using continuous mining machines. The other mine included in the deal is expected to be depleted by the end of the year and Alpha has said it will be replaced with a new mine in January 2008. Alpha expects to produce about 1 million tons of coal a year after it takes over.
CNMC to start nickel mine operations in Myanmar in 2007
Shanghai Securities Journal reported that China Nonferrous Metal Mining Company has recently got green light from Chinese government to invest USD 600 million in a 75:25 JV with Myanmar government to develop the Tagoung Hill nickel mine in Myanmar. The JV would start construction within 2007.
A cost study of world's similar nickel production is being carried out by Canada's Hatch Group, and will be submitted to the CNMC quite soon.
The Tagoung project is an open pit mine, and is believed to have total nickel reserves of up to 700,000 tonnes with an average grade of 2% nickel. The mine would have a capacity of about 85,000 tonnes per year and all of the eventual nickel output will be supplied to Chinese steel mills.
The Export Import Bank of China and China Development Bank would back the project.
(Sourced from MySteel.net)
Russian ferroalloy production in 5 months up by 5% YOY
Rusmet.com reported that positive trend of changes of production volumes of ferroalloys in Russia are taking place for several years and during January to May 2007, the shipment of ferroalloys by Russian enterprises made up more than 0.51 million tonnes which is higher than last year’s level by 5% YoY.
This is reported despite a 7% YoY decline in production by Russia, the largest producer of ferroalloys Chelyabinsk electrometallurgical steel mill.
Russia’s second largest ferroalloy producer Kuznetsk has increased its production by 28% YoY due to recent investments.
Practically all other enterprises producers of ferroalloys had positive trends, demonstrating growth of shipment in comparison with the level of last year.
Herald likely to get forestry permit for Dairi zinc project in Indonesia
Metals Insider reported that Australia’s Herald Resources released an update on the key forestry permit that is holding up its Dairi zinc lead mine project in Indonesia.
Herald Resources said that this project is running late. The original time table envisaged the start of mining by the fourth quarter of 2007 but key work is still on hold pending approval from the Indonesia’s ministry of forestry.
Herald Resources said that the minister in question has declined to issue the permit, arguing that it needs a presidential decree. A draft one has just been submitted to the cabinet office for scrutiny. Herald added that “Assuming the Presidential Decree is issued, the company would expect that the Ministry of Forestry would grant forestry approval for the Dairi Project in short order thereafter.”
Dairi mine is a potential big addition to mined supply capable of supporting annual production of 125,000 tonnes per year of zinc in concentrates and 80,000 tonnes per year of lead in concentrates.
