India de reserves CIL blocks and allocates 41 to power firms

It is reported that Indian government has allocated 41 coal blocks to public and private power companies which are expected to ensure generation of 68,000 MW of electricity.

1. 12 coal blocks with geological reserves of about 6.4 billion tonnes have been allocated to 18 central and state government companies to sustain power generation of approximately 30,000 MW

2. 15 blocks with geological reserves of 3.6 billion tonnes to support additional generation of 16,000 MW to 31 private companies

3. 4 coal blocks with geological reserves of 1,857 million tonnes have been allocated to two ultra mega power projects being set up in Orissa and Jharkhand having combined generation capacity of 8,000 MW

4. 2 coal blocks have been earmarked for two ultra mega power project of 2,000 MW capacities each in Chattisgarh

5. 8 coal blocks with geological reserves of more than 2.65 billion tonnes are also to be allocated through competitive bidding

The allocation comes after a decision of the energy coordination committee, under the chairmanship of Dr Manmohan Singh prime minister, to de reserve such coal blocks that could not be taken up by the Coal India Limited and its subsidiaries for mining in the near future. Dr Manmohan Singh approved the move saying that there was need for a greater consensus on breaking the monopoly of CIL.

The ministry of coal had identified 81 coal blocks with geological reserves of about 20 billion tonnes for allocation to companies. Of these, 41 coal blocks with geological reserves of about 15.7 billion tonnes were earmarked for the power sector. More than 900 applications were received for the allocation of these coal blocks.

Outotec to build 2 sinter plants at SAIL ISP

Outotec, formerly known as Outokumpu Technology, has announced that it has been awarded a contract by Steel Authority of India Limited for the design and delivery of 2 iron ore sinter plants on turn key basis as part of a consortium with Larsen & Toubro Ltd. Outotec's contract portion value exceeds EUR 22 million.

The new plants will be built at the IISCO Steel Plant of SAIL located at Burnpur in West Bengal and are part of SAIL's program of expanding its annual capacity at the IISCO Steel Plant by 2.5 million tonnes of crude steel. The sinter plants will produce 3.8 million tonnes of iron sinter per year. It is expected to become operational in early 2010.

Outotec's scope covers engineering, supply of proprietary and special equipment as well as technical services. L&T will cover engineering and supply of local mechanical, electrical and instrumentation works and complete site services including civil, structural and construction works.

Mr Tapani Järvinen president & CEO of Outotec said that "Outotec is currently building 2 sinter plants in India for TATA Steel, one in Jamshedpur and another in Orissa, as well as two plants for JSW Steel in Toranagallu. We have received orders for already four sinter plants from India this year, which clearly demonstrates our reliability as a supplier and our leadership in the iron and steel industry in the area of iron ore sintering technology."

Police bars POSCO entry to the site of steel plant

IANS reported that local police authorities have stopped officials of POSCO India from entering the site of its proposed steel plant in Orissa.

Local police is not allowing company officials to enter the villages that fall under the Dhinkia, Gadakujanga and Nuagaon panchayats in Orissa. Mr Rabinarayan Patra district assistant superintendent of police said that "We are stopping them for their safety."

A police official said that "The situation remains tense and at this moment we cannot allow them to enter the site. It is possible after the situation becomes normal."

A POSCO spokesman said that officials have gone to the local police station at Kujanga and met police officials several times in the past few days. They have also given in writing that they should be allowed to start work. They are yet to get a response.

Anti POSCO activists had abducted 4 company officials on October 13th 2007 when they had gone to the area for a survey and were released after a local police officer on behalf of the district administration gave protestors a written assurance that POSCO officials would not enter the site of the proposed plant again.

JSL Q2 net profit down by 57.7% YoY

Jindal Stainless Limited has announced the following unaudited results for the July to September 2007 quarter.

Jindal Stainless Limited has posted a net profit after tax of INR 418.10 million for July to September 2007 quarter down by 57.74% YoY as compared to INR 970.5 million for the July to September 2006 quarter. Total income has decreased from INR 11500.5 million to INR 11305.5 million.

JSW Steel looking for ways to overcome increasing costs

It is reported that JSW Steel is looking at various options to overcome the increasing costs of iron ore and coal. JSW Steel’s quarterly performance has been dampened by the rising costs of main inputs, iron ore and coal, doubling since last fiscal.

Mr Sajjan Jindal vice CMD of JSW said that “We had a 48% YoY growth in profit compared with the same quarter last year, mainly driven by volume growth and domestic demand, which could withstand the increase in prices of finished steel of various types. Increasing demand has come from the automotive and white goods sectors.”

Mr Jindal said that “We rely on NMDC and private mines in the area for 75% of our ore needs. We feel disappointed that the Karnataka government has not kept the terms of the MoU signed when we came here, to provide us mining rights for 30 years.”

Jindal Saw Q2 profit up by 90% YoY

Jindal Saw Limited has announced the following unaudited results for the quarter ended September 30th 2007.

Jindal Saw Limited has posted a net profit of INR 900.7 million for July to September 2007 quarter up by 89.3% YoY as compared to INR 475.7 million for July to September 2006 quarter. Its total Income has increased from INR 11402.90 million for to September 2006 to INR 14305.30 million for to September 2007.

According to a company release “The higher profitability has been achieved by the company as a result of improved productivity and bringing more efficiency in the operations in its various business segments including saw pipes, steel plates and seamless pipes.”

Jindal Saw sold its stake in a plate mill, pipe making mill and jointing and coating mill to JSW Steel earlier in 2007. It had also announced plans to focus on nearby markets by setting up 2 more plants. It is also looking at the feasibility of setting up a plant in the Middle East.

TATA to increase stakes in SA mining industry - Report

A report in Economic Times claimed that TATA may soon make a foray into South Africa's lucrative mining industry. The report said that TATA could team up with one of South Africa's established mining companies instead of going it alone.

Mr Raman Dhawan MD of TATA Africa Holdings told ET that it would not like to restrict itself to gold or diamond mining. He added that "We would like to engage ourselves in all forms of mining. Like in our other businesses here, we would like to partner with an established company in the mining sector too."

According to the ET, TATA has already earmarked an investment of USD 450 million in sectors such as telecoms and ferrochrome in South Africa.

TATA is said to be exploring opportunities to mine chrome, manganese, coal and iron ore in South Africa. It is already constructing a ZAR 650 million high carbon ferrochrome plant in Richards Bay on the KwaZulu Natal coast and in May 2007, its local arm TATA Africa said that it was considering setting up a vehicle assembly plant in South Africa.

In August 2007, TATA acquired a 35% stake in Riversdale Mining's Mozambique Coal Project for USD 86 million. The project, which would provide coking coal for its plants in Europe and India, was seen as opening the door for TATA to invest in South African coal mines. TATA Steel currently imports 1.3 million tonnes or 30% of its annual coal requirement and it has said this could rise to 2 million tonnes.

Jai Balaji buys entire shareholdings of Nilachal Iron & Power

Jai Balaji Industries Limited announced that in terms of the approval granted by the board of directors on July 21st 2007, it has purchased the entire shareholdings of Nilachal Iron and Power Limited, as per the terms and conditions of the agreement dated July 21st 2007.

JICA reports dedicated freight corridors economically viable

It is reported that Japan International Cooperation Agency, which presented its final study report on the dedicated freight corridor to the ministry of railways, has confirmed that the projects are economically feasible.

JICA stated that the economic internal rate of return would be 13.95% for the Western dedicated freight corridor and 15.09% for the Eastern dedicated freight corridor. JICA noted that a 12% economic rate of return could be considered a minimum base for judging a project as feasible.

JICA has stressed the need to have electric traction on the Western corridor. Since the Western corridor would serve container traffic, JICA has suggested the movement of double stack container trains on the route as well. The total cost of the project has been estimated at INR 50,000 crore. The costs include construction, rolling stock, operation and maintenance.

Indian Railways has proposed a 2,700 kilometer railway line project as an augmentation of capacity of network to handle the increasing volumes of freight traffic over the coming years. Completion of JICA study is the culmination of an initiative, which originated in April 2005.
The report was recently handed over to Mr KC Jena chairman of railway board by Mr T Fujii resident representative of JICA India.

BoI lends USD 200 million to TATA Steel for Corus buyout

It was reported recently that Bank of India has lent USD 200 million to TATA Steel UK to enable the TATA Group to refinance part of the USD 7.2 billion bridge loans taken for the Corus buyout.

Mr TS Narayanasami CMD of Bank of India said that “We have taken an exposure in TATA Steel. We have given about USD 200 million.”

SBI and Bank of India have taken the exposure to the biggest buyout (USD 12.9 billion) by an Indian company through their overseas branches. State Bank of India had earlier agreed to give a loan of USD 2.5 billion coming to TATA Steel’s aid after the company was unable to raise funds from foreign banks, which turned risk averse following the US sub prime mortgage crisis.

TATA Steel was looking to raise funds at 1.5 percentage points over the 6 month London inter bank offer rate before the sub prime crisis, SBI and Bank of India have lent additional funds to the Indian conglomerate at close to 2.5 percentage points over the benchmark Libor.

A senior banker said that “The average yield on the loan to TATA Steel would be 2.5 percentage points to 2.6 percentage points over Libor. The net spread would be around 1.5 percentage points.”

In August 2007, TATA Steel had to agree to pay 50 basis points more on a USD 1 billion, 7 year loan as the banks participating in the loan syndication bargained with the underwriters for higher yield. The loan’s underwriters were ABN Amro, Citigroup and Standard Chartered. There has been as much as 200 basis point increase in credit spreads on Indian loan and bond issues since the last week of July 2007, when the sub prime crisis first struck international credit markets.

Power trading growth slows down

It is reported that power trading as a business appears to be losing steam, although new players entered the sector when it opened up 3 years ago, the growth in traded volumes slowed down sharply during 2007.

Total details of traded volumes are as under
1. 11.03 billion Kwh during 2004, when PTC was the sole trader
2. It grew up by 7% YoY in 2005 when 3 new players, NTPC Vidyut Vyapar, Adani Exports and TATA Power Trading, entered the market.
3. When Reliance Energy Trading, Subhash Kabini and Lanco Electric Utility joined the market in 2006, total traded volume shot up by 20% YoY to 14.19 billion Kwh
4. Now, growth rate slipped back to single digit even as 2 new players, JSW Power Trading and KCT & Bros, joined the market.

A power industry analyst said that “There are 2 main reasons for the slowdown in the power trading business. First is the price ceiling put up by CERC at 4 paise per Kwh that has reduced the interest in the power trading business. Secondly, restrictions put on the sale of power from one trader to another trader. For instance, state corporations like Gridco of Orissa are categorized as traders and are not allowed to supply power to traders. This has dried up tradable surplus and also affected traded volumes.”

The drop in tradable surplus has also affected the proportion of traded volume in power generation. Of the total power generated, traded power accounted for 2.12% in FY04 and grew for the next two years when power trading business was liberalized and private players were allowed to get in. It reached 2.45% in FY06 but dipped to 2.41% last year. This implies the growth in power trading is lower than that of power generation.

Consequently, companies that have power trading licenses have not entered the market. Between FY04 and FY07, 22 power trading licenses were issued. Out of this, GMR Energy has surrendered its license. And of the remaining 21, only nine are operating in the market. License holders yet to start power trading business include DLF Power, Chattisgarh Electricity Company, MMTC, Jindal Steel & Power and Essar Electric Power Development Corporation.

Villagers go for indefinite hunger strike at NTPC Kaniha

SNS reported that about 40 affected villagers of the NTPC Kaniha power plant belonging to Bijigole and Baradangua in Orissa are on an indefinite hunger strike at the NTPC pump house since October 24th 2007 for the fulfillment of their 5 point charter of demands.

According to Ms Bharati Sahu president of Rights body, the villagers resorted to strike under the banner of organizations called the women rights armed forces and the NTPC Khyatigrastha Praja Sangh. The demands are provision of jobs, water supply and the maintenance of the school building.

REC defers ECB plans to tap domestic market

It is reported that power financier Rural Electrification Corporation has deferred its USD 1 billion external commercial borrowing plans and has switched to the domestic financial markets. Officials said that they had originally planned to raise the funds for meeting the lending commitments for this financial year.

REC officials said that “The external commercial borrowing proposal is on hold for the moment.” They added that external commercial borrowing plan was grounded in view of the Reserve Bank of India’s fiat to financial institutions and banks against raising ECBs for funding rupee credit requirements.

It is noted that RBI had tightened the external commercial borrowing guidelines in August 2007 to contain the liquidity surge in the domestic banking system. However, the RBI guidelines applied only to fresh ECBs. Therefore financiers such as REC could still draw on their existing commitments.

Indian Steel & Wire Products moves to SC against HC order

It is reported that Indian Steel & Wire Products Limited, which is being taken over by TATA Steel, has moved the Supreme Court against the Calcutta High Court's order that admitted a winding up petition filed by its creditors.

A bench headed by Justice Mr CK Thakker has issued notice to its creditors on a petition filed by the ailing company seeking quashing of the High Court order that directed it to pay dues of more than INR 2.7 million to Kothari Metals, one of its creditors, in 12 equated monthly installments. The High Court had also ordered that in case of default of payment of any two installments, advertisement for winding up the company should be published.

According to the petitioner, no proceedings for winding up could lie against a sick company during the period when such sanctioned scheme was under implementation. Indian Steel & Wire Products Limited said that "Even though the dues of the petitioning creditor were for the period not covered by the sanctioned scheme, yet the division bench of the High Court totally ignored the golden principle."

Kothari Metals had filed a winding up petition against Indian Steel during the period when the scheme sanctioned by BIFR was under implementation. The winding up petition was filed after Indian Steel failed to settle its claims for supply of nickel cathode during the erstwhile management of Jamshedpur Engineering and Machinery Company.

Indian Steel & Wire Products Limited was declared sick in September 2001 and the Board for Industrial and Financial Reconstruction had sanctioned TATA Steel's revival scheme in October 2003. Its board was reconstituted in December 2003 with TATA Steel taking over its management.

RIL in talks for picking up 2 oil blocks in Peru

It is reported that Reliance Industries Limited is in talks with Peru for picking up stake in 2 oil blocks and has completed the negotiations for the purpose, for which contracts are likely to be signed soon.

The agreement with the Peruvian company involves co operation in exploration and production, besides forming JVs for setting up petrochemical plants. RIL is also considering a bid for developing a 3,50,000 barrels per day of oil refinery in one of the central American countries of Costa Rica, Guatemala, Honduras and Panama.

Global Buyout Fund acquires major stake in Al Jazzera

Global Investment House announced today that its Global Buyout Fund, the recently launched buyout fund focused on investing in the GCC and MENA region, concluded its first investment in Al Jazzera Steel Product Company, a listed company on Muscat Securities Market.

Global Buyout Fund subscribed to 63,697,960 equity shares in Al Jazeera at OMR 0.325 which is at 43% discount to the market price of OMR 0.465 as of 21st of October 2007 resulting in the fund taking a majority stake of 51% post the capital infusion.

Al Jazzera Steel Product Company was established in 1997 and is a market leader engaged in the manufacturing and distribution of mild steel black and galvanized round, square tubes and pipes. Al Jazeera Steel is currently in the final stages of implementing a new merchant bar mill to offer a broader range of products that would cater to the construction sector.

Mr. Omar El-Quqa executive VP at Global Investment House said that the EGM held on October 21st 2007 approved the investment by the Fund, subject to approval from the Oman Capital Market Authority.

Iran remains top steel producer in Middle East

According to International Iron & Steel Institute, Iran's crude steel production during January to September 2007 has risen by 1.3%. Iran produced 7.45 million tonnes of crude steel during January to September 2007 period up from 7.53 million tonnes in January to September 2006. Production of crude increased by 4%YoY during September 2007 as compared September 2006. About 889,000 tonnes of steel were produced in Iran in September. The figures stood at 840,000 tonnes in August and 854,000 tonnes in September 2006.

Iran is a top producer of crude steel among three Middle East countries reporting to the international institute. Qatar produced a total 813,000 tonnes and Saudi Arabia 3.25 million tonnes during January to September 2007.

National Iranian Gas plans 53,000 kilometers new pipe lines

It is reported that Iran plans to invest USD 130 billion over the next 20 years to help meet rising domestic demand for natural gas.

According to the report, National Iranian Gas Co will allocate USD 90 billion to gas transmission projects. It will add to its existing pipeline network with 53,000 new kilometers of pipelines and 140 gas booster stations.

Mr Seyed Reza Kazzaeizadeh MD of National Iranian Gas Co said that “Based on the 20 year outlook plan, USD 130 billion will be invested, out of which USD 90 billion will be allocated to the gas transmission projects. He said under current circumstances, demand for gas in cold season is higher than supply and the output falls to meet the need.”

Lahore HC suspends revised tax notice for steel melting units

Pakistan Daily Times reported that Justice Mr Hamid Ali Shah of the Lahore High Court has suspended a notification under which the sales tax assessment policy was revised for steel melting units and put off the hearing till October 29th 2007. Mr Shah said that if the policy is implemented, the steel melting industry would be closed.

The counsel of the petitioners, including Quality Steel, Lucky Steel Foundries and others, said that sales tax was imposed on the production of manufactured goods but the procedure had now been changed and the sales tax was levied on the consumption of electricity.

The counsel said that there was a significant increase in electricity bills while the cost of production had also been increased from 10% to 20%. He added that the Pakistan steel industry is meeting the 60% demand of the steel consumption in the country and if the policy was implemented, steel melting industry will be ruined.

United Arab Shipping seeks loan to fund purchase of new ships

It is reported that Kuwait based United Arab Shipping has approached banks to arrange a USD 700 million loan to fund the purchase of new ships.

As per report United Arab Shipping was set up by 6 Gulf Arab states in 1976 to reduce the region's dependence on foreign shipping lines. It has a fleet of 33 vessels and is the largest ocean carrier of dry cargo to the Middle East.

According to shipping industry magazine Trade Winds, UAE plans to more than double its capacity to 190,000 20 foot equivalent units from 90,000. Two bankers said banks are bidding to arrange the deal.

5 Chinese steelmakers listed in 2007 WSD ranking

It is reported that 5 Chinese steelmakers are listed into the “World class Steel Producers" 2007 ranking by World Steel Dynamics, which includes 23 names in total.

The Chinese makers are
1. Baosteel
2. Anben Steel
3. Ma'anshan Steel
4. Shagang
5. Wuhan Steel

As per the list the global rankings are as under
1. Severstal
2. POSCO
3. ArcelorMittal
4. BaoSteel
5. TATA Corus

Shagang revenue crosses CNY 60 billion in 9 months

It's learned that Shagang Group in the first three quarters of 2007 has earned in sales revenue of over CNY 60 billion exceeding 2006 total income of CNY 58.7 billion.

Shagang Group sales income came to CNY 60.5 billion with pretax profit of CNY 8.8 billion up by 43% and 128%YoY respectively. During this period, it produced a total of 9.65 million tonnes pig iron, 12 million tonnes steel and 11.36 million tonnes products growing 16%, 15% and 22% respectively.

The company's spokesman said Shagang may achieve CNY 80 billion in sales revenue and pretax profits of CNY 10 billion in 2007.

Shagang ranks the 63 among China's top 500, the 23 among the top 500 manufacturers and the third among 500 top private enterprises. Its crude steel output is the fourteenth largest in the World. In next two years, Shagang plans to invest CNY 15 billion into energy conservation and restructuring and meanwhile raise HR and wide and thick plate production to 10 million tonnes to optimize product mix and strengthen competitive edge.

(Sourced from MySteel.net)

Baosteel CRNGO to be used in large electric machinery

It is reported that Baosteel and Harbin Electric Machinery signed a supply contract of B50A350 non oriented silicon steel that will be used to produce 300,000 Kilowatt thermal power station.

During January to June 2007, Baosteel developed another four brands of such material. Three brands out of a total nine have passed authentications by customers. The mill exported over 3,000 tonnes to 11 countries and regions such as the US and Italy in 2007.

Harbin Electric Machinery is one of the three top electric machinery manufacturers in the country and a backbone enterprise to produce medium and large power equipment, medium and large AC/DC motor and assistant facilities.

Sino International inks logistics contract with Jinan

Sino International Logistic Company NVs has announced that it has signed a contract with Jinan Iron & Steel Corporation, China Shipping Company and Shandong Automobile Industry Group to provide logistics and steel conditioning services.

According to the contract, Sino International Logistic Company NVs would provide logistics services for the transport of steel products from Jinan Iron & Steel Corporation to China Shipping Company and Automobile Industry Group and also takes over additional steel conditioning services.

The contract became effective in July 2007 and lasts for five years with an option to extend. The Company is expecting estimated total annual revenue of approximately EUR 2.5 million from the deal, depending on the transport volume.

Chinese refined nickel imports steady through September

According to the latest figures from China customs department that China’s net imports of refined nickel and nickel alloy were 6,414 tonnes in September 2007. The department said that was very much in the recent range of 5,000 tonnes to 7,000 tonnes per month since April.

Outright imports at just under 7,000 tonnes in September were a little softer than the previous couple of months but that was offset by a decline in exports to just 530 tonnes the lowest level since the first quarter of 2005.

Coal mine flooding traps 9 in northwest China

Xinhua reported that 9 miners were trapped in a coal mine in northwest China's Shanxi Province after it was flooded on Friday. No deaths were reported.

According to sources with the local government the no 3 shaft of the Yaotou Coal Mine near Chengcheng County was suddenly flooded at 11:40 AM trapping nine miners working underground.

Eight pumps have been used to help drain the flooded shaft as the cause of the accident is under investigation.

The local government has set up five working teams to supervise the rescue, logistics, investigation and deal with the problems that may arise with the accident.

CFSG bags fire fighting contract from Anshan

China Fire & Security Group Inc has announced that the Company has successfully secured a contract with Anshan Iron & Steel Group valued at approximately USD 2.9 million.

The released said that following the USD 7.6 million contracts signed in June 2007 for the first phase of Anshan Steel's expansion project, these USD 2.9 million contracts is for the power supply system in the first phase of Anshan Steel's expansion project.

Under this new contract, China Fire will provide an automated fire protection system which includes the Company's patented linear heat detectors, water mist fire extinguishing systems, and foam based fire extinguishing systems to ensure the fire safety for Anshan Steel's transformer station and power cable tunnels. China Fire expects to recognize this new contract as revenue over the next twelve months.

Anshan Iron & Steel Group is the second largest iron and steel manufacturer in China with an annual product output of over 16 million tonnes.

Xiangtan Steel aims to forge shipbuilding plate base

It is reported that the shipbuilding and ocean engineering steel plate made by Xiangtan Iron & Steel Corporation Limited have authorized by nine national classifications in US, Japan, Germany etc.

Xiangtan Steel is able to produce F40 high strength plate and Z performance plate, the second following Anshan Steel who owns this technique in China.

Mr Liu Jie GM said they want to form 2 million tonnes per year steel capacity at first stage of the 12th five year plan period and create the first rate world shipbuilding steel plate base.

In 2007, the company's shipbuilding plate will exceed 500,000 tonnes, while plan for 2008 is set to top 1.5 million tonnes.

(Sourced from MySteel.net)

Liuzhou Steel posts net profit of CNY 733 million in 9 months

According to Liuzhou Iron and Steel Company Ltd’s announcement released recently, the company realized net profit CNY 267 million in the third quarter of 2007 and CNY 733 million during the first nine months of 2007.

The financial report for the third quarter is not audited. Mr Liao Zhigang principal of the company, Mr Lai Yi the manager of the accounting department and Mr Jin Jianqun who’s responsible for the accounting, however said that the financial report of the third quarter is correct and complete.

Beijing to clean away 14 inferior industries

It is reported that during the Eleventh Five Year Plan Beijing municipal government will clean away 14 inferior industries including small sized steel, cement, papermaking, power and mining enterprises.

The China government will provide one off financial subsidy for the enterprises being sacrificed by the move to encourage them retreat from backward production links.

Pan’gang Gangcheng made new records on production

According to Pangang’s Gangcheng Cooperation General Company, following a record in August 2007 with revenue of CNY 550 million, the company realized operation income CNY 590 million and industrial production value CNY 420 million and industrial value added CNY 160 million increasing 32%, 7.1% and 12.5% respectively from those of the same period in 2006.

Ukrainian traders report 45.1% YoY increase in sales in 9 months

Ukrainian Journal citing Mr Andriy Fedoseyev president of Ukrainian Metal Traders Association reported that Ukrainian metal traders have increased sales by 45.1%YoY to 2.181 million tonnes in the first nine months of 2007.

As per report the leading traders are the Metinvest group's Leman Ukraine with 302,037 tonnes; Industrial Union of Donbas with 221,483 tonnes; Zaporizhstal related MD Group & Zaporizhmetall holding with respectively 143,059 tonnes ad 57,980 tonnes, independent traders Komex with 135,518 tonnes, Vikant with 81,842 tonnes, Transagency with 63,184 tonnes and Kaskad with 47,797 tonnes.

Raspadskaya Q3 net profit up by 135% YoY

Interfax reported that Russian coal producer Raspadskaya posted net profit to Russian accounting standards of RUB 597.908 million in the third quarter of 2007 up by 135% from the second quarter.

Raspadskaya said an increase in coal sales in the third quarter led to the significant growth in net profit.

Raspadskaya produced 3.684 million tonnes of coal in the third quarter. Raspadskaya sold 2.277 million tonnes in the quarter and exported 621,000 tonnes of that amount. Sales of raw coal totaled 579,000 tonnes in the period.

Raspadskaya includes three mining complexes Raspadskaya mine, MUK-96 mine, CJSC Razrez Raspadsky in addition to CJSC Raspadskaya Koksovaya mine CJSC OF Raspadskaya enrichment plant and various transport and production infrastructure enterprises. Raspadskaya is currently merging with the Evraz Group's Yuzhkuzbassugol coal company.

Ukraine’s natural gas consumption in 2007 likely to decline

Ukrainian Journal citing Ukrainian government reported that Ukraine, one of the world’s largest consumers of natural gas, will probably reduce gas consumption by 5.83% this year, reflecting warmer weather and energy conservation efforts.

The Ukraine government said Ukraine’s gas consumption will probably drop to 69.63 billion cubic meters in 2007 down from 73.94 billion cubic meters in 2006.

Ex GD of Severstal elected as head of Power Machines

RIA Novosti reported that the board of Russian heavy machinery manufacturer Power Machines elected recently Mr Igor Kostin, until recently a top manager at steel giant Severstal as general director. A Power Machines spokesman said Mr Boris Vainzikher had been dismissed from the top post.

Power Machines accounts for 37% of Russia's turbines, turbo generators, hydro generators and electrical equipment market. It produces, assembles, services and modernizes equipment for hydro, thermal, gas and nuclear power plants and the transportation industry. The company has clients in 87 countries.

Power Machines' largest shareholders are Russian electricity giant Unified Energy System and Siemens which hold 25% plus one share each and Interros, the holding company for the world's largest nickel producer Norilsk Nickel, which owns 30.4%.

SCM Group increase stake in two clay mining companies

SCM Group the large Ukrainian holding has announced that it has completed a deal to buy 45.38% of Druzhkivka mine group and 50% of Vohneupornerud, increasing its shares in the clay mining companies to 90.58% and 100%, respectively.

SCM Group said that Cyprus based UMG which fully belongs to SCM and which owns the clay mining assets of the group bought the stakes.

Barzasskoe Partnership gets coal field license in Kemerovo

It is reported that the tender to develop the coal field Barzassky 2 in Kemerovo region is recognized as failed due to only one bid being set out. Still the tender commission recommended giving the license to JV Barzasskoe Partnership as a sole bidder which offered RUB 34.5million against RUB 34 million in starting price.

Barzassky 2 coal reserves are estimated at 16.5 million tonnes. The acquisition of the new fields will permit JV to work for the nearest 25 years at the back of 1 million tonnes of coal a year. This year the output is assumed to be raised 20% to 3.6 million tonnes from 2.97 million tonnes prior year. The Group is going to invest RUB 600 million in the building of two enrichment sets of 1 million tonnes per year in the capacity.

Stroiservice Group involves four coal pits including Permyakovsky, Shestaki, Berezovsky and Barzasskoe Partnership as well as the Mining Engineering Plant.

Glencore to purchase shares of Russneft

FIS reported that the Swiss Company Glencore has submitted an application to the Federal Anti monopoly Service on the purchase of the shares of OC 'Russneft'

Since the package of documents provided by the company was incomplete, it was asked to provide additional information. Upon its receipt the application will be reviewed.

SDI completes the acquisition of OmniSource Corporation

Steel Dynamics Inc announced that it has completed the previously announced acquisition of OmniSource Corporation, a privately owned ferrous and non ferrous scrap processing and trading company.

SDI said that it paid approximately USD 1.1 billion for the company including USD 425 million in cash, 9.7 million shares of Steel Dynamics, Inc common stock valued at USD 451 million and the assumption of approximately USD 220 million of debt, which was repaid on closing.

Effective with the acquisition of OmniSource Corporation, SDI’s existing scrap operations in Virginia, Tennessee and Indiana will be transitioned to OmniSource. OmniSource financials will begin to be consolidated with Steel Dynamics’ results effective at closing. The expected effect of the OmniSource acquisition on SDI’s fourth quarter operating results will be provided with updated guidance in December.

Mr Danny Rifkin former president & CEO of OmniSource Corporation, is appointed an executive VP of Steel Dynamics reporting to the chairman & CEO. He will also serve in the capacity of president & COO of the OmniSource subsidiary of Steel Dynamics. Mr Rifkin has also been invited to join SDI’s Board of Directors.

Mr Keith Busse chairman & CEO of Steel Dynamics said that “We are very pleased to welcome OmniSource management and employees to the Steel Dynamics family. OmniSource becomes an important operating unit, providing significant additional diversification to our business model and offering our shareholders value by facilitating potential future growth in our steel businesses. On a pro forma basis for their fiscal year 2006, the combination of Steel Dynamics and OmniSource would have resulted in 2006 revenues of approximately USD 5.4 billion.”

In 2006 Steel Dynamics purchased 516,000 tons of ferrous scrap from OmniSource, accounting for about 10% of OmniSource’s ferrous scrap generation and 14% of SDI’s scrap purchases.

Malaysian builder lobby raise flag for rebar shortages

It is reported that 5 organizations representing interests in the Malaysian construction industry have raised serious concerns over the shortage of rebars.

The list of these organizations is as under
1. Master Builders Association of Malaysia MBAM
2. Real Estate and Housing Developers Association of Malaysia REHDA
3. Persatuan Kontractor Melayu Malayisa PKMM
4. Building Materials Distributors Association of Malaysia BMDAM
5. Association Chinese Chamber of Commerce and Industry Malaysia ACCCIM

In a joint statement issued by Mr Datuk Teo Chiang Kok president of ACCCIM, Mr Steven Tai president of MBDAM, Mr Patrick Wong president of MBAM, Senator Datuk Roslan Awang Chik president of PKMM and Mr Ng Seing Liong president of REHDA said that “To meet construction schedules, they have had to buy steel bars at artificially inflated prices which is above government controlled price and even this does not guarantee availability. This problem has been going on since early September this year and contractors have had to absorb the increased prices.”

They added that “Contractors are no longer able to absorb price fluctuations without facing serious cash flow problems and severely affecting the bottom line. If the situation is not checked, many jobs will stall or be abandoned.”

They urged the government to consider the following
1. Remove price controls on steel bars to curb supply manipulation
2. Ban export. Local steels millers should meet local needs first
3. Monitor rolling schedules. The Domestic Trade and Consumer Affairs Ministry should do this strictly to ensure production and delivery schedules are met.

Acerinox sees improvement in SS demand

Spanish stainless steel producer Acerinox said that demand for stainless products has recovered in the last few weeks, which will allow the company to increase production and deliveries at the end of the year.

Acerinox said that like other stainless producers, it took deep production cuts in Q3 in reaction to the aggressive de stocking by stainless distributors in reaction to the slump in nickel prices.

Its melt shop production fell to 389,500 tonnes in Q3 of 2007 from 654,600 tonnes in Q2 of 2007 and 659,800 tonnes in Q1 of 2007. Cumulative production of 1,703,900 tonnes in the January to September 2007 period fell by 11.3% YoY.

Melt shop production in January to September 2007 fell by 12.6% at its core Spanish operations, by 12.9% at its North American Stainless operations and by 7.5% at its Columbus operations in South Africa.

Production back to normal at Rautaruukki Raahe works

Rautaruukki Oyj announced the end of strike by members of the Union of Salaried Employees has resulted in an immediate start up of the units affected by the strike at Rautaruukki's Raahe Works in Finland and the production is expected to be back to normal. And deliveries to customers will also begin immediately.

Rautaruukki said that the strike by members of the Union of Salaried Employees had stopped hot rolling production and the cutting lines at the Raahe Steel Works. This had resulted in the stoppage of product manufacture at the works as well as deliveries to customers and products for further processing by the company. The strike did not significantly affect the operations of Rautaruukki's customer divisions.

It added that separate information will be provided about the financial effects of the industrial action on the company as these become known once production has returned to normal.

Rautaruukki supplies metal based components, systems and integrated systems to the construction and mechanical engineering industries. The company has a wide selection of metal products and services. Rautaruukki has operations in 24 countries and employs 14,500 people.

Rio Tinto acquires additional shares of Alcan

Rio Tinto today announced that approximately 14.04 million additional common shares of Alcan Inc have either been validly deposited and taken up under the offer by Rio Tinto Canada Holding Inc to acquire all of the shares of Alcan or are covered by notices of guaranteed delivery.

The additional shares which represent approximately 3.73% of the outstanding shares, together with approximately 319.94 million shares already beneficially owned by Rio Tinto Canada Holding, represent approximately 88.82% of the outstanding shares of Alcan. All additional validly deposited shares will be taken up daily and payment for such shares will be made to the depositary within two business days of take up. Shares covered by notices of guaranteed delivery will be taken up when the certificates representing them are delivered to the depositary.

The Offer expires on November 8th 2007.

Venture Steel to acquire Ontario based Winston Steel

Royal Laser Corp announced that its wholly owned subsidiary Venture Steel Inc has signed a letter of intent to acquire substantially all of the operating assets of Winston Steel Inc a Ontario based steel service centre. Venture Steel in a release said that the deal still requires due diligence, regulatory and government approval and negotiation of a definitive agreement. A closing date is expected sometime in the third quarter ended December 31st 2007.

Winston is a custom flat rolled steel processor specializing in hot rolled, cold rolled and galvanized steel for the tubular, building products, automotive and general manufacturing market sectors. Winston operates out of two plants totaling approximately 145,000 square feet located at Mississauga in Ontario and has capacity to process in excess of 300,000 tons of steel.

Mr Beric Sykes president of Venture Steel said that "The addition of Winston to Venture Steel augments our current operations and provides us with additional space and slitting capacity required to service our anticipated growth. We are excited to be a leader in the consolidation of this industry, and we believe that this will strengthen our overall operating results, going forward."

Venture Steel Inc is a wholly owned subsidiary of Royal Laser Corp, is a custom flat rolled steel processor specializing in all types and grades of hot rolled, cold rolled and coated steel. It operates out of combined facilities totaling approximately 170,000 square feet located in the Greater Toronto Area of Ontario.

Aurox Resources seeks Japanese partner for Yalgoo iron ore project

It is reported that Australian new iron ore miner, Aurox Resources Limited tries to get partner from Japanese steel industry to develop new Yalgoo iron ore tenements, which is located mid west of Western Australia.

The firm prepares the project in the year based on recent drilling results. The firm expects the project could be cost competitive new resource. The firm tries to start the project after 2010 when the firm launches Balla Balla iron ore project in northwest of Australia co.

Straits Asia to buy 2 Indonesian coal mining concessions

ANTARA News reported that Singapore listed coal mining subsidiary of Australia's Straits Resources, Straits Asia Resources has agreed to buy two more coal mining concessions near its coal mines on the Indonesian island of Sebuku. The two concessions are estimated to have coal reserves of 34 million tonnes to 50 million tonnes, of which 4 million tonnes can be mined immediately.

Straits Asia Resources in a release said that it is conducting due diligence and will pay USD 25 million once the due diligence is completed and a further USD 114 million will be paid once Indonesian government approvals have been secured.

This is the second acquisition announced by Straits Asia in recent months. Last month, the company signed a MoU on the purchase of a thermal coal mining operation in the Indonesian province of East Kalimantan.

Mr Richard Ong CEO of Straits Asia said that “This acquisition offers further tremendous potential for growth of our business beyond our goal of 6 million tonnes production in 2009."

Timken Q3 sales up by 6% YoY

The Timken Company announced sales of USD 1.26 billion in July to September quarter of 2007 up by 6% YoY as compared to July to September quarter of 2006. For January to September 2007 period its sales totaled USD 3.89 billion up by 4% YoY as compared with January to September 2006 period.

Timken's income from continuing operations during the July to September quarter of 2007 increased by almost 6.5% YoY to USD 41.2 million from USD 38.7 million in July to September quarter of 2006.

In the July to September quarter period of 2007, Timken realigned its operations under two business groups the Steel Group and the Bearings and Power Transmission Group. The company has said that these different segments will be incorporated into its financial reports from the fourth quarter of 2007. Timken said that Special items for the quarter, including restructuring, rationalizing and impairment charges, totaled USD17.2 million. For January to September 2007 period, this figure was USD 60.8 million.

The Industrial Group posted earnings before interest and taxes in the third quarter of USD 55.4 million from sales of USD 556.8 million. EBIT was up by 14.9% YoY while sales were up 11% YoY, for the July to September period. For January to September 2007 period, sales grew by 9% YoY to USD 1.67 billion, while EBIT increased by 5.5% YoY to USD 166.3 million.

Compared with a July to September period loss of USD 26.3 million in 2006, the Automotive Group posted a slightly narrowed loss of USD 20.7 million in July to September 2007 period. Sales fell from USD 363.6 million to USD 361 million this year. For January to September period, the Automotive Group registered a loss of USD 35.3 million on sales of USD 1.16 billion down by 5% YoY.

The Steel Group posted sales of USD 381.1 million in July to September period driven by strong demand across all market sectors. This was up 7% from the USD 355.6 million it posted in July to September 2006 period. For January to September 2007, Steel Group sales reached USD 1.18 billion up by 6% YoY. Increased material and manufacturing costs, compounded by an increase in the Group's LIFO reserves, resulted in the Steel Group's EBIT for the third quarter slipping to USD 47.4 million as compared with USD 50.4 million in 2006. For the January to September period, however, its EBIT grew by 1.9% YoY to USD 170.4 million from USD 167.2 million in 2006.

Mr James W Griffith president & CEO of Timken said that “While Timken’s third quarter performance exceeded what we achieved last year, our results still fell short of what we had expected to deliver. As we move forward with our strategic initiatives, we have intensified our efforts to drive better execution across the company during a period of strong demand in multiple market sectors.”

Messer Group to build ASU in Vietnam

VNA reported Germany’s Messer Group and Hoa Phat Group signed a contract to build an air separation plant, the biggest of its kind in Vietnam in northern Hai Duong province with a total investment of USD 30 million. The new plant is expected to be operational 14 months after the signing ceremony.

Under the deal, Messer Group will invest USD 30 million in the construction of a separation and liquefaction facility to produce and liquefy oxygen, nitrogen and argon with a capacity of 16,500 cubic meters per hour of oxygen.

The new plant intends to provide 70% of its gases to Hoa Phat Group’s steel production, it will also supply both liquid and compressed gas to northern Viet Nam, particularly the Ha Noi Hai Phong corridor.

Mr Stefan Messer CEO of Messer Group said that "The industrial gases market in Viet Nam has huge potential as the economy continues to grow together with the industrialization process. We are searching for ways to expand our business in Viet Nam, outside of our current mainstay China."

Messer is a leading group specializing in producing industrial gases. It has been present in Vietnam for a decade now. The group currently owns two gases companies in Ho Chi Minh City and Haiphong. Messer Group is also planning a separate industrial gases plant in central Vietnam in partnership with Shinimex (Haiphong), a subsidiary of Vietnam Shipbuilding Industry Corp, to supply gases to Vietnam's shipbuilding industry.

ConsMin Q1 manganese output falls by 17% YoY

West Perth based takeover target Consolidated Minerals Ltd has reported a shortfall in manganese production of 40,000 tonnes or 17% YoY during the July to September quarter 2007 because water and silt hampered mining in its pits.

Mr Rod Baxter MD of CosMin in notes for a speech to shareholders on October 25th 2007 said that the landed price of manganese rose to between USD 7.65 per tonnes and USD 9.10 per tonnes for the December quarter as compared with the USD 7.25 per tonnes to USD 7.50 per tonnes record price received between August and October 2007. He added that most of the price gains in the December quarter are related to higher shipping charges and the price ConsMin will receive is expected to remain firm in the period, without giving details.

ConsMin one of the largest manganese producer which is the target of two takeover offers, predicted this week that global trade in the metal will grow 7% a year for the next five years. ConsMin in a statement to the Australian Stock Exchange said that "Consolidated Minerals expects the manganese market to remain strong into fiscal 2008 due to robust demand and a number of supply issues being experienced by key ore suppliers.”

Mr Baxter said that ConsMin wants to raise manganese production in fiscal 2008 by 5%. Operating costs will rise by up to 15% this year due to higher royalties.

Tenova commissions walking beam furnace at Monterrey Hysla

Tenova announced that after the successful completion of the erection and start up phase, jointly carried up by Tenova LOI Italimpianti, Techint and Ternium Hylsa, the new slab reheating furnace at the Ternium steel plant in Monterrey Hylsa was put in operation.

The new furnace features latest generation technology using the new FlexyTech® Tenova flameless burners that combines reduced consumption and extremely low emissions with a reheating quality at today’s highest levels. These burners have already been successfully installed by Tenova LOI Italimpianti on recent high capacity reheating furnaces for which NOx emissions were an important concern.

The new furnace will replace the old battery of pit furnaces, currently in dismantling phase, guaranteeing increase of production capacity together with significantly higher quality, reliability and flexibility.

The contract for engineering work and supply of the advanced technology plant components was awarded to former Techint Technologies Furnace Business Unit based in Genoa (Italy), now Tenova LOI Italimpianti, which completed the project on schedule. The contract also covered support for plant installation, testing, start-up, and related services.

Tenova, former Techint Technologies designs and supplies advanced technologies, products and services for the metal and mining industries. Tenova operates close to its customers through a network of 20 companies based in 14 different countries.

EU cuts Bulgaria greenhouse emissions quota by 37%

It is reported that European Commission has cut Bulgaria's greenhouse emissions quota for 2008-2012 by 37%, saying that the Bulgaria's environment ministry did not offer compelling arguments in defense of its demand for a bigger quota.

EC said that Bulgaria will have the right to trade up to 42.3 million tonnes of carbon dioxide equivalent. Earlier Bulgaria had asked for 67.6 million tonnes, aiming to capitalize on its relatively clean record when it comes to the Kyoto protocol on cutting emissions and sell a large amount of its carbon credits to other countries.

According to European Commission, Bulgaria greenhouse emissions in 2005 were 40.6 million tonnes of carbon dioxide equivalent and the country has plans to further cut emissions by upgrading its biggest polluters thermal power plants and the Kremikovtsi steel mill. It added that fellow EU newcomer Romania, which joined the bloc together with Bulgaria in January, also received a smaller quota than it asked for 70.8 million tonnes, compared to the 95.7 million tonnes Bucharest had in its proposal.

Mr Dzhevdet Chakarov environment minister of Bulgaria said that they will appeal the Commission's decision and could take the matter to court. Mr Chakarov told reporters that "We will not allow Bulgaria to turn from a potential seller of carbon credits into a buyer."

He added that "The decision to cut the emission quota by 37% could have a very strong negative impact on the Bulgarian firms' ability to compete in Europe." However, the EU has long been concerned by Bulgaria's measures on monitoring greenhouse gas emissions and the Kyoto protocol implementation.

Earlier this month, the European executive has even launched an infringement procedure against Bulgaria for failing to provide enough information on the issue.

German SS production to be down by 20% YoY in 2007

According to estimate by the ERG Edelstahl Recycling GmbH, Germany’s stainless steel production in 2007 is expected to drop by 20% YoY to around 1.4 million tonnes.

The report added that output of 300 series stainless steel is estimated to be only 940,000 tonnes, accounting for around 67% of overall volumes. Germany produced around 1.5 million tons of 300 series stainless steel in 2006.

Besides, it has lowered its 2008 growth forecast to 2% from 2.4%.

Massey Energy Q3 profit down

Massey Energy Company announced that its July to September quarter 2007 net income of USD 21.4 million as compared to net income of USD 24.2 million in July to September quarter 2006 which included a USD 30 million pre tax gain on the sale of reserves.

Massey Energy said that its July to September 2007 quarter earnings were generated on produced coal revenue of USD 521.9 million which increased by 13% YoY as compared to July to September 2006 quarter as a result of higher total sales volume overall and significantly higher sales of metallurgical and industrial coal. Its EBITDA was USD 96.2 million as compared to USD 104.2 million in July to September 2006 quarter.

Massey's July to September quarter operating cash margin of USD 7.49 per ton represented an increase of 10% YoY as compared to the operating cash margin of USD 6.79 per ton reported in July to September 2006 quarter. The increase was driven largely by improved product mix. Sales of metallurgical and industrial coal were particularly strong with a 23% YoY and 20% YoY increase in tonnes sold respectively compared to the third quarter of 2006.

(In USD million)

Mr Don Blankenship chairman & CEO of Massey said that "We are pleased with the solid results we were able to achieve in the quarter and in the first nine months of the year. Our cash costs remain among the lowest of all Central Appalachia coal producers and we continue to leverage the quality and diversity of our reserves to take advantage of new and increasing opportunities in the metallurgical coal market. We are on pace to have a record year in terms of revenue, EBITDA and earnings per share."

Massey Energy Company headquartered at Richmond in Virginia, with operations in West Virginia, Kentucky and Virginia, is the fourth largest coal company in the United States based on produced coal revenue.

Utah coal output estimates cut due to shutdowns

Platts reported that the Utah’s Geological Survey has revised down its figures for coal production in the state in 2007 and 2008 in the wake of the fatal August accident at Utah American Energy's Crandall Canyon underground mine that also led to the temporary shutdown of Utah American's Tower mining complex.

Mr Michael Vanden Berg a geologist at the survey's energy and minerals section said that last week that he reduced his projections for 2007 Utah tonnage by 1.5 million short tons to 24.9 million short tons. He also reduced his projection for 2008 to about 25.9 million short tons from the previous estimate of around 28 million short tons. He added that the shutdowns of the two Utah American mines were the chief reasons for the reduced estimates.

Last August, Utah American temporarily idled its Tower mine near Price, Utah. The company which is a subsidiary of Murray Energy said that the mine shutdown was necessary to modify longwall equipment at the mine and the company was taking precautions in case of further complications from what it described as seismic activities in the area. The company did not provide a timeframe for when production at the mine would resume.

The company's decision to idle Tower came weeks before the deadly accident at the Crandall Canyon mine in Emery County, where an August 6 underground cave in trapped six miners who were never recovered and are now listed as mining fatalities. Unsafe underground conditions halted rescue efforts there, and resulted in three rescuers' deaths and six others' injuries.

According to the survey, combined production from the Tower complex, which consists of the Aberdeen and Pinnacle mines, totaled 2.1 million short tons in 2006. Production at Crandall Canyon and South Crandall Canyon totaled 1.4 million short tons in 2006, down by 24.6% YoY from 1.8 million short tons in 2005. South Crandall was idled in October 2006.

Although the two mine shutdowns took a good chunk of production off the Utah market, Mr Vanden Berg said he has not "heard of any shortages yet." He added that Intermountain Power Agency's Intermountain Power Project north of Delta "would be the only plant significantly affected by the closing of Crandall and Tower, but I hear that so far, they have been able to find other supplies." IPP purchased a total of 6.2 million short tons of coal in 2006, of which 6.1 million short tons was Utah coal and 167,000 short tons were from Wyoming.

Azure divests magnetite project for AUD 2 million

West Perth based metals explorer Azure Minerals Ltd announced that it has entered into a conditional agreement for the sale of its 100% owned Splinter Magnetite Iron Ore Project to Icon Resources Ltd.

Azure will receive AUD 50,000 by providing Icon a three month option over the project. Icon can elect to extend this option for an additional three months by the payment of an additional AUD 100,000. The exercise price for the option is AUD 2,000,000.

The divestment of Splinter continues Azure's strategy of consolidating its project portfolio and focus on the development of its key assets in Mexico, including the Pozo de Nacho molybdenum project and the Los Chinos and Jagüey silver lead zinc projects.

After a period of data review, field exploration in Mexico has recommenced with a soil sampling program at Los Chinos, mapping and sampling at La Providencia and reassaying of drill intercepts at Pozo de Nacho. Planning of the next phase of drilling has been completed and drilling should commence within 2 weeks. Projects to be drilled include La Providencia, Los Chinos and Pozo de Nacho.

Mr Tony Rovira MD of Azure said that "the divestment of Splinter represents an opportunity for the Company to realize full value for this non-core and only remaining Australian asset. The Company is now able to fully focus on its portfolio of exciting Mexican projects."

Force majeure at Dawson coal mine

According to Japanese coal industry newsletter the Tex Report, Anglo American plc’s coal unit and Mitsui & Co have declared force majeure on shipments from their Dawson mine in the northeastern Australian state of Queensland.

A spokeswoman for the company said by phone that the move was prompted by an incident at a coal handling unit. Repairs may take about two months, resulting in a decline in coal shipments from the mine in November and December.

According to the newsletter Mine customers are being forced urgently to seek alternative supplies, yet options are limited because of the tightening market for both coking and power station coal.

Consol posts losses in Q3 due to shutdowns

Consol Energy Inc announced a net loss of USD 5.4 million for July to September 2007 quarter as compared with net income of USD 48.3 million in July to September 2006 quarter. Its net cash from operating activities was USD 141.6 million for the quarter as compared with USD 90.2 million for July to September 2006 quarter.

Consol Energy said that the Buchanan Mine roof fall that occurred on July 9th 2007, adversely impacted net income during the period just ended by approximately USD 84.0 million, which includes additional expenses incurred in managing and monitoring the underground mine atmosphere since the mine was idled, as well as income from sales that were lost once inventories at the mine were depleted.

(In USD million)

Mr J Brett Harvey president & CEO of Consol said that "The idling of the Buchanan Mine early in July, overwhelmed what was generally a good third quarter. While the third quarter is historically a slow quarter for our mining operations mainly due to miners' vacation had it not been for the Buchanan event, we would have been well ahead of last year's third quarter and essentially on-target with most of our internal projections.''

Mr Harvey said the financial impacts of the Buchanan idling could be mitigated in the future because the company expects to make recoveries under its existing insurance policies. He added that "We have several coal projects that give us the ability to increase our production over the next few years, if market conditions warrant it.''

Those include the project at the Shoemaker Mine, he said, which is expected to increase the mine's production capacity up to 7 million tons per year. That mine's previous capacity was 4 million tons per year.

Pittsburgh based Consol operates 20 mining complexes in West Virginia, Pennsylvania, Virginia, Utah, Kentucky and Ohio.

Nucor celebrates 50 years at Flowood

It is reported that Nucor Steel celebrated 50 years this weekend. Nucor Steel in Flowood held a big party Saturday for its golden anniversary. Governor Haley Barbour, State Treasurer Tate Reeves, State Auditor Phil Bryant, and several state senators and house members attended.

Governor Barbour said that “The steel industry in Mississippi is enormous, and it is a great field to get into. The average production worker here makes more than USD 80,000 a year. I can remember growing up in Mississippi, when companies came here looking for strong backs and low wages. Now they come looking for strong minds and are willing to pay for them."

This facility recycles 0.5 million tons of steel per year. Nucor employs about 265 workers in Mississippi.