SAIL RSP H1 output at new high

Steel Authority of India Limited’s Rourkela Steel Plant has posted its best first half or April to September period production since inception. It achieved hot metal output of 184,546 tonnes, total crude steel production of 175,091 tonnes and total saleable steel production of 1,67,795 tonnes during the period. These represented capacity utilization of 112.3%, 112.1% and 122% respectively.

Similarly, best ever September was achieved in the production of total HR coils at 1,32,983 tonnes, HR coils for sale at 60,519 tonnes, plates at 41,311 tonnes and HR plates at 26,363 tonnes. Rourkela Steel Plant dispatched 177,211 tonnes of steel, which, besides being the best for any September, was higher by more than 6% YoY compared to September 2006. It also achieved all time best production levels for the April to September period in major areas like hot metal with 1.06 million tonnes, crude steel with 0.98 million tonnes, total saleable steel with 0.98 million tonnes as well as dispatch of steel with 0.95 million tonnes. All time best first half performance was also achieved in finished products like plates from plate mill with 232,851 tonnes, HR coils for sale with 3,58,387 tonnes, HR plates with 156,445 tonnes and CRNO steel with 39,078 tonnes.

With the objective of improving its profitability, Rourkela Steel Plant has adopted the strategy of maximizing capacity utilization to bring down its cost of production and concentrating on the production of value added products in line with market demand. During the first half of 2007, it did well to maintain capacity utilization of nearly 112% in hot metal production, 103% in crude steel and an impressive 117% in saleable steel output.

India committed to gas pipeline project - Government

It is reported that India remains steadfastly committed to the USD 7.4 billion Iran Pakistan India pipeline project. Mr E Ahamed minister of state for external affairs, on a visit to Iran, said that India on principle has backed the project and discussions on certain aspects like pricing were on among the 3 countries.

Mr Ahmed said that "Too much is being read into the fact that India did not attend the meeting in Tehran last week. During my visits to Iran in August2007 and the visit of the Iranian oil officials to New Delhi, the Indian government has expressed full support for the pipeline project. Our tie with one country is not at the expense of the other."

Earlier Mr MS Srinivasan petroleum secretary said that India continues to be part of the original tri nation project but reaching a pact depends on settling transit issues with Islamabad. He added that "We have never said that we are pulling out of the IPI project. We are part of the project and will continue pursuing import of gas from Iran through the three-nation pipeline."

Mr Hojjatollah Ghanimi Fard Iranian oil minister's special envoy was quoted as saying in the Iran oil ministry's website Shana that “The revised prices were based on Iran's demand and was outlined according to the terms and conditions of the latest contracts of the country. Even if India attended the talks, nothing other than these articles was accepted." Mr Ghanimi Fard said that Tehran and Islamabad would sign the gas contract by October 31st 2007. He said after 4 days of talks between Iranian and Pakistani officials, the two sides settled the problems and finalized the contract last Saturday. He added that "All issues related to gas exports to Pakistan were discussed and all differences were restudied and finalized. Whenever India resolves its problems and calls for joining the project, we welcome it and the contract will be trilateral."

TATA Steel Vietnam steel project on track

A Vietnam Steel Corporation official said that TATA Steel is due to complete a feasibility study on its proposed 4.5 million tonnes per year integrated steel plant called Ha Thinh in central Vietnam by the end of 2008. He added that the project is on track to start to construction in 2009 and commissioning by 2012.

The project is a 65:35 JV between TATA Steel and Vietnam Steel Corporation. The steel project is expected to reach its design capacity of 4.5 million tonnes per year over 10 years with capacity in the first phase likely to be 2 million tonnes per year to 2.5 million tonnes per year.

A steel market participant said that “Companies like TATA which work with Vietnam Steel Corporation will be fine. But there are so many steel projects in Vietnam now that I do not believe all of them will come into production. The investment climate is uncertain and as more projects come on stream, the remaining unrealized projects will find themselves crowded out of the market and unable to find raw materials.”

According to Viet Nam News, the government has said that Vietnam needs no more than 1 or 2 more integrated steel mills in the next decade to reach its targeted capacity of 15 tonnes per year to 18 million tonnes per year by 2020.

Vietnam had seen a flood of steel investments in 2006, with POSCO, Essar, Jinan Iron & Steel among the big names jostling for a piece of the pie. However, the limited market and raw material supply may also squeeze out some projects before they come on stream, noted industry observers.

SAIL gets 2006-07 dividend from power JV NSPCL

NTPC SAIL Power Supply Company Limited, a 50:50 JV between Steel Authority of India Limited and National Thermal Power Corporation has paid INR 3 crore to SAIL as final dividend for the year 2006-07. Mr SK Roongta chairman of SAIL received the cheque from Mr RC Srivastava chairman of NSPCL.

NSPCL had paid interim dividend of INR 1.5 crore to SAIL in March 2007 before declaring a total dividend equivalent to 23% of profit after tax. The performance of NSPCL has been continuously improving year by year and it has paid dividend continuously since inception in 2001.

NSPCL registered a net profit after tax of INR 38.97 crore in 2006-07 up by 31% YoY over 2005-06 on a net worth of INR 867.98 crore. Bhilai Electric Supply Co Ltd, another 50:50 JV of NTPC and SAIL, was merged with NSPCL recently.

NSPCL is presently implementing a Greenfield power expansion project of 2x250 MW at a cost of around INR 3,000 crore at Bhilai. The first unit is expected to be operational by early 2008. SAIL will receive about 280 MW of power from this unit, which will provide security in meeting the enhanced level of power requirement of Bhilai Steel Plant.

Bidding plan for transmission projects to be finalized soon

It is reported that centre is in advanced stages of finalizing standard bid documents based on its tariff based competitive bidding guidelines for inviting private sector participation in the transmission sector, in consultation with the Power Finance Corporation.

As per report, union power ministry has roped in PFC and Rural Electrification Corporation for carrying out the groundwork on identified transmission lines to be executed through the process and three special purpose vehicles have been set up to kick start the initiative. The special purpose vehicles have been incorporated as Bokaro Kodarma Maithon Transmission Co and East North Interconnection Co and REC Transmission Projects Co.

The special purpose vehicles have been entrusted with the responsibility of preparing project profiles and obtaining necessary clearances to set the stage for these projects to be handed out to private players.

Out of a total of INR 75,000 crore investment envisaged in transmission sector during the 11th Plan, about INR 20,000 crore is expected to come in through the private sector. Besides the competitive bidding based projects, private sector investment in transmission is also sought to be encouraged through the entry of generating companies in building their dedicated transmission lines and through more JV with PGCIL, where majority equity is to be brought in by the private developer.

Centre to invest INR 10,000 crore in 5 new deep seaports

It is reported that India’s union shipping ministry is planning to set up at least 5 deep seaports during the 11th Five Year Plan period with an expected investment of INR 10,000 crore and would be issuing requests for proposal for appointing consultants for developing these ports. The ports would be developed through the public private partnership mode.

Shipping ministry officials said that though the plan of setting up 5 more deep seaports is at an early stage, the government would control the connectivity aspect of the proposed ports. They added that also, the physical structures like bridges would also be constructed by the government and private companies would be given the task of developing and managing the berths and terminals of the proposed ports.

The government is planning these ports because currently none of the 12 major ports in India have a draft of more than 12 meters. The proposed deep sea port in West Bengal as well as the other 5 ones would have draft of around 16 meters.

Steel Strips posted highest ever sales in September

Steel Strips Wheels Ltd announced that it has achieved highest ever production & sales in September 2007.

It has achieved highest ever production of 0.502 million wheel rims during September 2007 up by 30% YoY as against 0.386 million during September 2006.It has also achieved highest ever sales of 0.501 million wheel rims during September 2007 up by 35% YoY as against 0.370 million wheel rims during September 2006.

Kolkata Port to revive dry docks business

It is reported that Kolkata Port Trust has taken up a program to refit and revive its dry docks so that it can grow beyond handling just in house jobs and take up more external or merchant business.

Mr Anup K Chanda chairman of Kolkata Port Trust said that “The Kolkata dry docks and workshops are being revitalized and critical civil works are being implemented as part of a process in which every department of the port is being told to stop looking inwards and to test its competitive strength and efficiency by bidding for and executing outside jobs.” He added that the dry docks department would have to keep its in-house users happy and at the same time execute merchant jobs to the satisfaction of the customer.

The Kolkata Dock System of KoPT has 5 dry docks and the news of their revival has already led to rising demand from outside agencies for their services. It expects them to do well in view of the rise in coastal shipping and the long queue for dry dock services seen at such facilities in the region.

Mr Chanda admitted that while demand may be strong at present because of the global and regional upswing in the shipping industry, the docks would face their real test during down cycles. The KoPT intended the dry docks to be benchmarked against comparable global facilities in terms of capability and also in terms of time competitiveness. He said that the recent success of the dry docks in handling a contract relating to a Singapore-flagged vessel had proved that the KoPT plans to upgrade infrastructure were going the right way.

To make the docks competitive, infrastructure being developed includes handling and storage equipment, bilge blocks, as well as installation of modern drive systems and valves, top end cleaning and painting systems and better lighting and drainage systems.

The 5 dry docks were set up to handle repair and maintenance needs as also surveys and underwater repair of all types of vessels calling at the riverine port. Entry is not from the river directly but from the impounded dry dock basins. There are also 2 lay up berths at Kidderpore and one lay up berth in the Netaji Subhas docks in KDS.

L&T to enter power generation business

It is reported that Larsen & Toubro has floated a new arm called L&T Power Projects to foray into the booming power generation business. The new entity will concentrate more on generation rather than transmission and distribution.

L&T PPL will sign a 51:49 JV agreement with Japanese electrical giant Toshiba shortly for setting up a turbine manufacturing facility. The JVs entail an investment of INR 1,500 crore and they will be completed by 2009. The manufacturing bases will come up at Hazira in Gujarat.

A company official source said that “L&T Projects is considering bids for the ultra mega power projects at Krishnapatnam and Tilaiya. L&T PPL may tie up with other companies for the INR 18,000 crore UMPPs. It is firming up plans to bid for other mega power generation projects in the country too.” Another source said that “L&T is now the end to end solutions provider in the power sector. It has constructed many power plants for others. Thus, it will not be a tough task for the company to enter into power generation. For initial investments, L&T PPL will get money from the USD 1 billion infrastructure fund of the parent company.”

At present, L&T PPL is undertaking transmission infrastructure projects for Indian Railways. In the future, L&T PPL may also look for opportunities in the transmission and distribution segments. The engineering, construction and contracts division of the company has orders for setting up two thermal power projects in Barmer with 1,080 MW and Jharsuguda with 2,400 MW and a gas based project in Trombay with 250 MW for TATA Power.

GAIL to set up petrochemical plant in Iran

BL reported that GAIL India, at a time when political and business relations between India and Iran are under pressure, is planning to set up a mega USD 2.3 billion petrochemical plant in Iran and has appointed Engineers India Ltd to conduct feasibility studies for the plant with a capacity of 3 million tonnes a year. The project would have Reliance Industries Ltd and an Iranian government owned company as partners.

A source in the Iran embassy confirmed that GAIL was likely to set up the plant in partnership with the Iranian National Petrochemicals Company. The official added that “Our petrochemical company has already completed the feasibility study on the plant. GAIL wanted to do one on its own too. Our company will wait for GAIL to complete its studies.”

So far, however, JV between Indian and Iranian government owned companies have not been fruitful. An agreement signed 2 years ago by GAIL and Indian Oil Corporation and National Iranian Gas Export Company to supply liquefied natural gas from Iran has not worked out. Another agreement between IOC and Iran to set up an LNG liquefaction plant in Iran will not be extended after the deadline expires this month.

GAIL will also set up another petrochemical plant in south India with a capacity of 1 million tonne a year, which is likely to come up at Vishakhapatnam near Hindustan Petroleum Corporation’s refinery. GAIL operates a 440,000 tonnes a year petrochemical plant at Pata in Uttar Pradesh and had planned another plant at Kochi, which is yet to start.

Indian Railways revenue earning up by 13.78% YoY in 10 days

It is reported that Indian Railways has recorded a total approximate earnings of INR 1815.18 crore during the period September 11th 2007 to September 20th 2007 up by 13.78% YoY as against INR 1595.37 crore during the September 11th 2006 to September 20th 2006.

INR in crore

The total number of passengers booked during September 11th 2007 to September 20th 2007 were 188.92 million up by 2.72% YoY compared to 183.91 million during September 11th 2006 to September 20th 2006. In the suburban and non suburban sectors, the number of passengers booked was 107.50 million and 81.42 million compared to 107.85 million and 76.06 million, registering a decrease of 0.32% YoY and 7.05% YoY respectively.

Suzlon Energy bags major order from DLF

Suzlon Energy Ltd has announced that it has secured a major order from DLF Ltd for setting up of a wind farm of 150 MW wind turbine capacity in Gujarat. The order comprises 100 units of Suzlon's S82 1.5 MW turbines, which will be installed by March 2008.

JNPT gets ‘Indira Gandhi Raj Bhasha Award’

Exim News Service reported that Jawaharlal Nehru Port Trust has been awarded the ‘Indira Gandhi Raj Bhasha Puraskar’ (2nd prize) for excellent implementation of the official language policy of the union government during 2005-06.

Mr SS Hussain chairman of Jawaharlal Nehru Port Trust has received the award from Mr Shivraj Patil union home minister.

MEPS forecast SS price revival by 2007 year

MEPS reported that June 2007 was the peak month for stainless steel selling values. It said that “The third quarter and much of the final trimester will prove to be a tough period for all stainless steel producers. Mills in Western countries, which operate the alloy surcharge mechanism, are offering massive discounts on published basis and or alloy surcharges to attract the small amount of business available. They are suffering substantially reduced activity. Moreover, they are diverting, where possible, over-production to their depots, which are now almost full. It is inevitable that the steel makers' financial performances will be badly hit in the August to December period.”

MEPS said that nickel prices dropped in mid August to just above USD 25,000 per tonne. Figures rose to USD 32,600 by September 24th 2007. We expect alloy surcharges for grade 304 to rise in the US in November and the EU in December 2007. This should translate into higher transaction values near the turn of the year or early in 2008, depending upon the inventory draw down over the next few months.

MEPS added that we should, however, not feel too sorry for the mills. They enjoyed substantial profits over the past twelve months as artificial demand was created by the hikes in the nickel price. This gave them opportunities to significantly lift basis values and alloy surcharges.

MEPS also added that full year results are expected to be excellent for the majority of stainless steel makers. Asian mills have not fully embraced the alloy surcharge mechanism. They relied upon lifting selling values in line with the cost of raw material inputs plus a modest amount for improved demand. With nickel prices rising once again they are attempting stainless price hikes. This may meet with only limited success in the short term.

US ITC keeps AD duty on large dia pipes from Japan and Mexico

The US International Trade Commission determined that revoking the existing antidumping duty order on welded large diameter line pipe from Japan would be likely to lead to continuation or recurrence of material injury within a reasonably foreseeable time, but that revoking the existing antidumping duty order on this product from Mexico would not.

As a result of the Commission's affirmative determination regarding Japan, the existing order on imports of welded large diameter line pipe from Japan will remain in place. As a result of the Commission's negative determination regarding Mexico, the existing order on imports of this product from Mexico will be revoked.

The action comes under the five year sunset review process required by the Uruguay Round Agreements Act.

BHP Billiton says coking coal demand very strong

MarketWatch quoted Mr Peter Toth marketing director for carbon steel materials of BHP Billiton Ltd as saying that the coking coal market remains very strong.

Mr Toth told analyst that "The underlying fundamentals of the coking coal market are very strong and it's the strongest that we have seen for some time."

Due to infrastructure constraints continue to limit supply and that demand from traditional customers remains strong, while China and India continue to grow.

European steelmakers preparing AD case against China

AFP has reported that European steelmakers are preparing to lodge a complaint in the coming weeks against China for selling finished steel products in Europe at below cost. The source said on condition of anonymity that "A dossier is being prepared. If the dossier is lodged, then clearly it's with a request to launch a procedure based on the complaint."

When a dumping complaint is filed with the European Commission, the panel then has to launch an investigation to see whether the charges stand up before taking a decision on retaliation.

Mr Peter Power spokesman for Commission for trade issues stressed that the Chinese steel imports were a complex issue because there are also many European users happy with cheap Chinese products. The final consideration will take into account many elements, not exclusively those of European steel producers.

According to Eurofer, a confederation of European iron and steel makers, imports of Chinese made finished steel products into Europe are booming and are expected to double this year. That would be much faster than the roughly 20% growth that the EU has seen in overall imports of Chinese-made goods in recent years.

Mechel H1 net profit up by 55% YoY

Russian integrated mining and steel group Mechel OAO announced results for the H1 of 2007. Its net revenue in the H1 of 2007 up by 55% to USD 2.99 billion as compared to USD 1.93 billion in the H1 of 2006, reflecting increased production volumes and strong selling prices across the Company’s primary product categories.

Operating income during the period up by 252.8%YoY to USD 738.9 million or 24.7% of net revenue as compared to operating income of USD 209.5 million or 10.9% of net revenue in the H1 of 2006.
For the first half of 2007, Mechel reported consolidated net income of USD 489.5 million. Its consolidated EBITDA rose by 136% YoY to USD 813.7 million in H1 of 2007 from USD 344.7 million a year ago.

(In USD thousand)

Mining sector
Mining segment revenue from external customers for the H1 of 2007 totaled USD 897.8 million or 30.1% of consolidated net revenue, an increase of 46.3% YoY as compared with segment revenue from external customers of USD 613.5 million or 31.8%, of consolidated net revenue, in H1 of 2006. The increase in revenues reflects increased total output, strong market positions and a favorable pricing environment. Operating income for the H1 of 2007 in the mining segment rose by 334.9% YoY to USD 419.3 million or 33.9% of total segment revenue, compared to operating income of USD 96.4 million or 12.6% of total segment revenues in H1 of 2006. This increase in profitability reflects Mechel’s enhanced cost control efforts, as well as the overall efficiency of the Company’s mining operations as revenue levels increased. EBITDA in the mining segment for the H1 of 2007 was USD 449.7 million, 206.0% YoY higher than segment EBITDA of USD 146.9 million in the H1 of 2006. The EBITDA margin for the mining segment increased to 36.3% YoY as compared to 19.2% in H1 of 2006.

Steel sector
Revenue from external customers in Mechel’s steel segment increased by 59.1% YoY in H1 of 2007 to USD 2.1 billion or 69.9% of consolidated net revenue, as compared to revenue from external customers of USD 1.3 billion or 68.2% of consolidated net revenue reported for H1 of 2006. In the H1 of 2007, the steel segment generated operating income of USD 348.4 million, or 16.5% of total segment revenue, an increase of 206.8% YoY over operating income of USD 113.6 million, or 8.6% of total segment revenue in the first half of 2006. EBITDA in the steel segment for the first half of 2007 increased by 98.1% to USD 392.7 million, compared with USD 198.3 reported in the H1 of 2006. EBITDA margin for the steel segment rose to 18.6% in H1 of 2007, compared with 15.0% reported in H1 of 2006.

Mr Igor Zyuzin CEO of Mechel said that “During the first half of 2007, Mechel continued to move forward with its plans for scaling up production volumes and increasing profitability. In addition, the Company expanded its existing production capacity and acquired new assets that complement Mechel’s current operations. The Company’s operational progress, coupled with the ongoing favorable market conditions, enabled Mechel to achieve record financial results for the first half of 2007, tripling its operating income when compared to the same period last year.”

ArcelorMittal Ostrava H1 output up 7%

Steel maker ArcelorMittal Ostrava, formerly known as Nova Hut, during H1 of 2007 produced 1.558 million tonnes of steel up by 7% YoY as compared to 106,000 tonnes in H1 of 2006. Its 55% of the output was exported, mostly to Germany during H1 of 2007 as compared 59% in H1 of 2006.

Mr Josef Buryan production and technical director of ArcelorMittal Ostrava said that ArcelorMittal Ostrava benefits from stable demand for its products and favorable prices on the market. In particular the output and quality of flat products was raised thanks to investments, adding that CZK 900 million was invested in the H1 of 2007.

ArcelorMittal Ostrava is the largest steel maker in the Czech Republic and a member of the biggest world steel group ArcelorMittal. For the 2006-07, it netted CZK 9.6 billion, CZK 5 billion more than a year earlier. Total revenues reached CZK 58.7 billion, against CZK 57 billion in 2005-06 financial year. It turned out 3.06 million tonnes of steel in 2006 and exported 59% of output, supplying products to 88 countries worldwide.

China pig iron export to different countries in Jan to Aug 2007

China pig iron ore import from different countries in January to August 2007 totaled 4511,481 tonnes. Its imports during August 2007 amounted to 42,019 tonnes.

China imported iron ore product from 16 countries during January to August 2007. The details are as under

(In tonnes)

(Sourced from MySteel.net)

ArcelorMittal to join Alrosa for bidding of Elga coalfields

Bloomberg reported that ArcelorMittal would bid in an auction for the world's largest untapped coking coal deposit together with Russian diamond monopoly ZAO Alrosa.

Mr Nikita Prokopiev a spokesman for the regional government of Sakha where the field is located said that the two companies would participate in the October 5th 2007 auction via a Russian registered venture, ZAO Yakutskaya Ugolnaya Kompaniya. The starting price for the Elga field is USD 1.8 billion.

Mr Prokopiev said that Russian steel and coal producer OAO Mechel will bid together with Japan’s Sumitomo Corp and the third bidder is a Russian registered company called OOO Kolor Partner that represents foreign investors.

Steel imports in Romania and Bulgaria soar

According to the Iron and Steel Statistics Bureau, with the entering as EU member countries early this year, Romania and Bulgaria’s imports of steel show a significant increase.

Iron and Steel Statistics Bureau said that Bulgaria's overall imports in H1 of 2007 rose by 44% YoY as compared to H1 of 2006 and the imports in Romania even rose more as 71%.

It further added that for both countries tube and semi finished products were growing significantly. In 2007 the EU25 became the EU27 with Romania and Bulgaria becoming members.

CVRD to bid for FNS railway operations

Companhia Vale do Rio Doce has announced that it will participate in an auction, for the sub concession for commercial exploitation of a 720 kilometer stretch of the North South railroad. The auction will take place on October 3rd 2007.

The release said the bids in the auction will be made through sealed envelopes, and the first minimum bid will be for BRR 1,478,205,000.00. The winner of the auction will be responsible for the operation, maintenance, control, improvements and adaptations of the stretch for 30 years.

FNS is being implemented by VALEC Engineering, Construction and Railroads SA a state owned company run by the Ministry of Transportation, which is the holder of the concession for building and operating the railroad. This stretch runs from Açailândia, state of Maranhão to Palmas, state of Tocantins in Brazil. This project will open up a new corridor for the transportation of general cargo, mainly for the export of soybeans, alcohol and sugar, produced in the Center North region of Brazil.

Since 1996 CVRD operates FNS involving a 225 kilometer stretch, linking the cities of Açailândia and Estreito in the state of Maranhão. At Estreito, FNS joins up to the Carajás railroad enabling access to the port of Itaqui in São Luís where CVRD has the Ponta da Madeira maritime terminal.

Zinifex and Umicore announce intention to sell shares

Zinifex Limited and Umicore SA/NV has announced their intention to sell shares in Nyrstar SA/NV through an initial public offering in the coming weeks. The offering remains subject to market conditions and investor demand, as does the size of the offering.

As a result, Nyrstar, the world’s largest zinc metal producer, would list on the Eurolist of the Euronext Brussels stock exchange.

The shareholders are also considering the potential issuance of equity-linked instruments concurrently with the offering.

UBS Investment Bank, Deutsche Bank and Goldman Sachs International have been appointed as joint global co coordinators of the equity offering; UBS Investment Bank, Deutsche Bank, Goldman Sachs International, Fortis and KBC Securities have been appointed as joint book runners and Fortis and KBC Securities will be joint lead managers of the Belgian public tranche of the equity offering.

Moody affirms ‘Ba1’ rating for Steel Dynamics

Moody's Investors Service has announced that it affirmed the 'Ba1' corporate family rating on Steel Dynamics Inc following the company's buyout plans of Omni Source Corp, one of North America's largest scrap metal distributors for around USD 1 billion.

Moody's also affirmed the 'Ba1' probability of default rating and 'Ba2' rating on the company's USD 500 million senior unsecured notes and senior subordinated convertible notes, keeping the outlook stable.

Moody's said the corporate family rating reflects the steel manufacturer's low cost mini-mill operating structure, growing production capabilities, and improving product mix, which is shifting more toward higher value added steel and specialty alloys.

The ratings agency said the outlook reflects its view that Steel Dynamics will continue to exhibit solid earnings and cash generation over the next twelve months on low cost position and continued acceptable business environment in key markets served.

MoU for coal mining and power generation at Thar

It is reported that the Sindh Coal Authority, Mines and Mineral Development Department, Government of Sindh and M/s Idrees Steel Co of Karachi signed MoU for establishment of integrated coal mining and power generation at Thar coalfield in district Tharparkar.

The MoU was signed by Mr Syed Abbas Ali Shah director general, of Sindh Coal Authority and Mr Muhammad Idrees CEO Idrees Steel Co. The government of Sindh after demarcation of the area jointly by SCA and director general, Mines and Mineral development Sindh and technical personal of the company will allocate an area of 65.56 square kilometer to Idrees Steel Co for conducting the feasibility study.

The company would conduct a survey and exploration/investigation at own cost and risk for completing the feasibility study of Thar coal in Block V and adjacent area for development of coal mine and establishment of power of minimum capacity of 300 MW.

The sponsor company will submit a complete coal mining feasibility study report to Sindh.
Coal Authority within 18 months of signing of the MoU. The feasibility study report shall determine the suitable quality and quantity of coal, which can be economically, and safety mined, handled and transported to the power plant in order to provide at least one million tonnes of coal or more annually for 30 years. M/s Idrees Steel Co shall apply for letter of intent to Private Power and Infrastructure Board, Water and Power Development Authority the government for allowing establishment of proposed power plant.

Iran will considerably increase its steel production

Rusmet reported that Iran plans to increase the steel production till 29 million tons toward 2010.

Iran produced 6.56 million tonnes of steel during the first eight months of the current year. It is only 1% more in comparison with 2006. The indexes of August increased only by 2% till 840,000 tonnes.

However, Iran can considerably increase its steel production in 2008. A new blast furnace will be built at Isfahan Steel & Works. It will rise the steel production by 1.4 million tonnes. A new sheet rolling mill will start up Khuzestan Steel Complex. The construction of the complex Zamzam 2 will be finished.

Iran plans to rise the steel production till 29 million tons toward 2010. But none of these projects was not realized up to date.

Canadian Royalties and Norilsk ink agreements for nickel concentrates and investments

Canadian Royalties Inc and Norilsk Nickel Harjavalta Oy have announced that the signing of several agreements aimed at expediting the development of CRI’s Nunavik Nickel Project. The agreements include a sales agreement for nickel concentrates an immediate CAD 25 million share subscription, and an option for additional financing at a later date to ensure project completion.

Following an extensive bidding process, CRI has reached an agreement with Norilsk Nickel to sell nickel concentrates produced from its Nunavik Nickel Project to Norilsk Nickel. The terms of this agreement are considered by CRI’s management to be highly competitive with market rates.

Under the equity investment, Norilsk Nickel shall subscribe on a private placement basis for an aggregate of 7,246,377 common shares in the equity of CRI at a price of CAD 3.45 per common share for a total of CAD 25 million. The purchase price represents a 23% premium over the closing price of CRI’s securities recently September 28th 2007. The subscription is subject to the approval of the Toronto Stock Exchange. Under the agreement, CRI may request Norilsk Nickel to provide an additional CAD 25 million in financing on mutually agreed terms to ensure project completion.

Mr Richard Faucher president & CEO of CRI stated that “The successful conclusion of these agreements represents a major milestone for CRI. Forming this strategic partnership with Norilsk Nickel reduces several project risks, including risks related to the financing of the project. Another significant part of our considerations in favor of Norilsk Nickel has been access to their technical know how which will support CRI to capture the tremendous resource potential of the Nunavik Nickel Project.”

Mr Antti Aaltonen MD of Norilsk Nickel Finland Oy said “We are pleased to enter into this agreement with CRI. It is the culmination of a long period of cooperation and negotiation to bring the development of the Nunavik Nickel Project together with the assets and know-how of the Norilsk Nickel group. We look forward to working with the management of CRI on this exciting and important project.”

Norilsk Nickel is one of the world's largest precious and non ferrous metal producers, accounting for more than 20% of the world's nickel output, over 10% of cobalt and 3% of copper and produces 96% of Russia's nickel, 55% of its copper and 95% of its cobalt.

Macarthur receives AUD 69 million damages claim from partners

Macarthur Coal Limited has announced that its board of directors has been informed that two wholly owned subsidiaries of the company, Monto Coal Pty Ltd and Monto Coal 2 Pty Ltd have been served with a statement of claim for proceedings in the Supreme Court of Queensland by the three JV participants in the Monto Coal JV which are not associated with Macarthur Coal Limited, being Sanrus Pty Ltd, Edge Developments Pty Ltd and H & J Enterprises Pty Ltd. The claim is for damages of not less than AUD 68.97 million for breach of contract plus interest and costs.

Monto Coal is the manager of the Monto Coal Project pursuant to a Management Agreement. Monto Coal 2 holds a 51% interest in the Monto Coal Joint Venture.

The Plaintiff Joint Venture Parties claim that:
1. Monto Coal 2 was in breach of its obligations under the Joint Venture Agreement and
2. Monto Coal was in breach of its obligations under the JV Agreement in relation to the suspension of all work on the Monto Coal Project in 2003 and in maintaining that suspension and that the Plaintiff JV Parties suffered damage as a result.

Mr Nicole Hollows CEO of Macarthur Coal said the company would strongly defend itself against the plaintiff’s claims. The allegations against Monto Coal and Monto Coal 2 are unfounded in our view and we will strongly defend the company against the claims.

Macarthur Coal is an Australian coal company developing a new generation of coal assets in Queensland’s Bowen Basin. The company currently holds 73.3%of the Coppabella and Moorvale mines.

Steel & Alloy moves to new distribution centre

It is reported that a new distribution centre, capable of handling 25 tonne steel coils is being opened in Darlaston following an agreement between the UK's largest automotive steel processing company, Steel & Alloy Processing and Honda Trading Europe.

Steel & Alloy Narrow Products, previously based in Smethwick will relocate to the new depot giving the business more space to develop and grow. The new distribution centre contains three five tonne cranes, two 25 tonne cranes and a 36,000 square feet bay, making it the perfect facility for the storage and distribution of large coils.

Mr Mark Cooper MD of Steel & Alloy said that "We have invested in this new distribution centre as a direct result of our relationship with Honda Trading Europe, for whom we currently process approximately 60,000 tonnes of steel a year. Vehicle manufacturers are always looking for ways to streamline their operations and this facility achieves this goal."

Nickel mining firm in Agusan shuts down

It is reported that less than two years after it started operating SR Metals Inc based in Barangay La Fraternidad here shut down, citing financial difficulties owing to the reported drop in the price of nickel in the world market.

Mr Anthony Ryan Culima the company’s acting resident manager said “SR Metals Inc decided to close down starting September 24th 2007 based on management decision that continuing operation at this point has ceased to be viable.” He added the company had already stopped its marketing operations since September 3rd 2007.

SRMI started its mining activities in March 2006 under the small scale mining permit issued by the Provincial Mining Regulatory Board of Agusan del Norte.

JFE to supply Toshiba with steam turbines

Thomson Financial reported that Toshiba Plant Systems & Engineering Corp, a unit of Japanese electronics giant Toshiba Corp and JFE Engineering Corp, a unit of JFE Holdings Inc, have agreed to ally in the power plant turbine business to explore business opportunities in a rapidly growing market.

Under the arrangement, Toshiba Plant Systems will supply its high pressure steam turbine technology to the unit of JFE Holdings and procure small steam turbines with power outputs of up to 100,000 kilowatts.

With the alliance, the Toshiba unit said it expects to win new orders for 15 to 20 small steam turbines worth JPY 25 billion a year, up from annual orders for 5 to 10 turbines worth JPY 20 billion a year.

Toshiba Plant Systems, in which Toshiba holds a 59.6% stake, currently sells such turbines supplied by its parent company.

North Queensland top coal producing mines

According to a coal industry figures released by the Queensland Government Goonyella Riverside and Peak Downs mines in the north are the top two coal producing operations in the state.

Mackay's Dalrymple Coal terminal was the second biggest exporter during the last financial year, with more than 50 million tonnes and Gladstone led the state in coal exports with a narrow lead of just under one million tonnes.

Mr Greg Smith operations manager of Dalrymple Bay said that upgrades completed by December 2008 would boost exports to 85 million tonnes a year. He said that "The majority of BBCT coal in terms of customers goes to North Asia, being Japan and Korea,"
He added that "Definitely Japan and Korea take over 50 per cent of the coal that comes out of the terminal they're quite large customers. That's probably followed by the likes of India, Brazil and Europe."

Siemens to deliver turbines for New Zealand’s largest wind farm

Siemens Power Generation has announced that it will supply its most advanced wind power technology to support New Zealand in its endeavor to build up a carbon-neutral electricity sector by 2025. State-owned Meridian Energy Ltd has ordered 62 Siemens turbines for its West Wind project, located 15 kilometers west of the state capital Wellington. The official groundbreaking of New Zealand’s largest wind farm, with a total capacity exceeding 140 megawatts took place on September 27 and was attended Mr Helen Clark PM of New Zealand.

The new order from New Zealand is the first large order for the Siemens Wind Power from the Pacific Region. The 62 wind turbines for the West Wind project have a capacity of 2.3 MW each and are to be delivered at the end of 2008. Blades and nacelles will be shipped from Denmark. The total scope of supply includes installation, startup, project management and a two year service agreement. The wind farm is expected to start full commercial operation in the second half of 2009.

Only recently the New Zealand government announced its ambitious plans to fight climate change. The country’s electricity sector is to become carbon neutral by 2025 with 90% of electricity supply to originate from renewable energy sources. Wind power will play a major role in achieving these targets. Meridian Energy Ltd. is already supplying more than one third of New Zealand’s electricity demand, based on hydro and wind power only.

Mr Andreas Nauen Head of the Siemens Wind Power Division said that “Siemens technology will play an important role in building up a carbon-neutral energy sector in New Zealand. We will deliver our most advanced wind power technology to support New Zealand’s plans for climate protection. Our wind turbines are reliable, cost-efficient and climate friendly and will help to secure a sustainable future energy supply in the Pacific region and on a global scale.”

The Power Generation Group of Siemens AG is one of the premier companies in the international power generation sector. In fiscal 2006 Siemens PG posted sales amounting to more than EUR10 billion and received new orders totaling EUR 12.5 billion. Group profit amounted to EUR 782 million. On September 30th 2006 PG had a work force of approximately 36,400 worldwide.