December, 23 2007
RINL awards power plant contract to BHEL
It is reported that Rashtriya Ispat Nigam Limited has signed an agreement with Bharat Heavy Electricals Limited for expansion of its power plant with a 67.5 MW turbo generator and a 330 TPH boiler. The order worth INR 394 crore is to be executed within 26 months.
BHEL Hyderabad will manufacture the generator while the Tiruchi unit will provide the boiler.
This project is a part of the RINL’s overall expansion plans to enhance capacity from 3 million tonnes to 6.3 million tonnes.
Sanghi Industries plans a steel plant in MP
It is reported that Sanghi Industries Limited has plans to set up a steel plant of 1 million tonne capacity at an investment of INR 2,000 crore in Madhya Pradesh.
As per report, Sanghi Industries Limited has been approached by the government of Madhya Pradesh to sign a deal for its proposed cement plant originally planned at INR 1,000 crore and has since revised its investment plan in terms of plant capacity enhancing it from 3 million tonne to 7 million tonne. Consequently, the investment in the proposed cement plant in Satna district will be enhanced from INR 1,000 crore to INR 3,000 crore. It will also have a 60 MW captive thermal power plant.
Thus, the aggregate investment by Sanghi Industries Limited in Madhya Pradesh will go up to INR 5,000 crore.
Arcelor Mittal to promote steel consumption in India
BS reported that Arcelor Mittal is looking at ways to promote steel consumption in India.
Mr Malay Mukherjee board member of Arcelor Mittal said that it is looking at various measures, including investments and bringing in best practices, in cost effective use of steel. He added that "The per capita use of steel in India is 45 kilogram as against 280 kilogram in China and 500 kilogram in developed nations, which shows the huge potential to drive steel consumption in India. With India poised to grow exponentially on all fronts, we foresee a significant demand for steel in the coming years and our efforts for steel intensive activities are in line with this."
On the 2 steel plants Arcelor Mittal is setting up in India with a total investment of USD 20 billion, Mr Mukherjee said that the plants would have a capacity of 6 million tonnes each, which the company plans to double in 4 or 5 years. He said "Acquisition of 8,000 acre in Keonjhar district of Orissa is currently on, while we are yet to finalise the location for the second plant in Jharkhand."
TDP opposes equity dilution in RINL
Mr N Chandrababu Naidu president of Telugu Desam Party said that the party is opposed to the decision taken by the board recently to dilute the equity of the Rashtriya Ispat Nigam Limited to the extent of 25%. He added that the party will also oppose any move to merge RINL with SAIL.
Mr Naidu said that the Visakhapatnam steel plant had been set up as a result of the agitation of the Telugu people, with the slogan “Visakha Ukku Andhrula Hakku and therefore any move to weaken the plant is to be deplored. Equity dilution, I suspect, is a prelude to merger with the SAIL, which is not acceptable to us. Now, it has turned around and is earning profits. Therefore, there is no justification for equity dilution or merger with SAIL.”
He also found fault with the state government for allotting Obulapuram iron ore mines to the newly floated Brahmani Steels in Kadapa district, ignoring the claims of the Visakhapatnam steel plant. He said “Lack of captive mines is a serious handicap suffered by the plant and the state government has chosen to ignore this plant and grant ore mines worth INR 50,000 crore to a new company. Dr YS Rajasekhara Reddy chief minister is behind the decision as he has a covert stake in the company. It is a benami transaction.”
Mr Naidu is equally critical of the union government’s for its alleged change in the stand on merging the Bharat Heavy Plate and Vessels with BHEL.
Villagers protest against TATA Steel’s Bastar project
BS reported that hundreds of villagers have resorted to road blockade at Bastar in Chhattisgarh to protest against the land acquisition for the proposed TATA Steel plant in the district.
The ongoing protest of villagers against the plant took another turn when more than 1,500 people blocked the vehicular movement in the Jagdalpur Chitrakote road. They are now demanding that the administration should return their lands that it had acquired for the steel plant.
Suzlon drops plan for plate mill
BS reported that Suzlon Energy has dropped plans to set up an integrated steel manufacturing unit in India for captive consumption.
Mr Tulsi Tanti CMD of Suzlon said that it had conducted feasibility studies a few months ago for setting up a steel plant in Karnataka, but has decided not to go ahead with this in the next few years. He added that “Now, our focus is on completing the capital expansion plans in India. We have decided against creating own steel manufacturing plants in the near future.”
It was earlier reported that Suzlon was planning to set up an integrated steel plant with a capacity of 2 million tonnes per annum. It requires 85 tonnes of steel plate for every megawatt of wind turbine capacity it manufactures, which works out to about 500,000 tonnes a year of plate for its operations worldwide.
TATA ranked world's 3rd most accountable and transparent group
TATA Group has been named the world's 3rd most accountable and transparent company by Britain's One World Trust although US hotel chain Orient Express has not found it worthy of an alliance.
According to Mr Rob Lloyd, the report's lead author, the assessment is a measure of the extent to which organizations have the policies and systems in place to enhance consistent and coherent accountability to the people they affect.
One World Trust rated UN development program followed by Asian Development Bank and Christian Aid the most transparent and accountable organizations among world's top 30 organizations.
The report used the Global Accountability Framework to assess policies and systems of organizations according to four widely accepted dimensions of accountability transparency, participation, evaluation, complaint and response mechanisms.
The report collected data from publicly available information, documents provided by the organizations themselves, and interviews with their key officials. In addition, stakeholders and experts on each of the organizations are engaged in the data collection and verification stages of the research.
JCT forms wind mill JV with Dakshidin Corporation
It is reported that JCT has formed a 50:50 JV with Dakshidin Corporation for distribution and manufacturing capabilities of Dakshidin's RESTEC windmills in India.
The exact financial and technical feasibility for the manufacturing set up and the equity structure is expected to be finalized by February 2008.
It is learnt that, JCT is in preliminary discussions with the Punjab government for installing windmills on an experimental basis.
NTPC Talcher sets record in power generation
SNS reported that, for the first time since it became operational in 2004, National Thermal Power Corporation owned 3,000 MW Talcher super thermal power plant at Kaniha has achieved a record feat in terms of power generation.
According to a top NTPC official source, Talcher super thermal power plant is maintaining a daily average plant load factor of 103% from the beginning of December 2007 by producing about 75 million units per day as against the installed capacity of 72 million units per day. The aim of the NTPC authorities at Kaniha is to sustain the record till the end of the current month.
NTPC sources claimed that a very few plant of the power major so far has attained sustainable PLF up to 103%. The plant performance has been a monthly average of 99.32% of plant load factors in month of June 2006 against the NTPC all India average of 97%. It has come down to about 90% in four subsequent months due to shut down of one unit of the plant. It again picked up from the end of November 2007 to reach above the 103% PLF from the beginning of December 2007.
Mr Somenath Banerjee executive director of Talchar plant said that the generated power is distributed to at least 17 states including Orissa as per the allocation. Orissa is at present drawing 400 MW from the pool but can draw more than its allocation if the state is nearest to the plant. He added that the plant has got the distinction of being the only NTPC power plant in India received highest ever coal on a single day as it drew a whopping 80,582 tons of coal getting 13 rakes in a single day from 2 coalfields of Mahanadi coalfield Limited.
ONGC to invest INR 1,200 crore for captive wind energy
It is reported that Oil & Natural Gas Corporation is entering the alternative energy segment with a INR 1,200 crore plus investment to generate 200 MW of wind power for captive use within 2 years.
Mr Anoop Kumar Mathur GM technical of ONGC said that “We have placed orders for 50 MW and will soon install another 50 MW in Karnataka. Within the next year, ONGC will add another 100 MW and is exploring options in Maharashtra and other states. In Gujarat, the electricity generated will be used to power the sucker road pumps, used in enhanced oil recovery from our old oil fields in Kutch.”
ONGC has already placed orders with the Pune based Suzlon Energy for 50 MW of wind turbine capacity to be installed in Gujarat’s Kutch region. It has approved the 50 MW unit in Karnataka and is in the process of finalizing the location. Andhra Pradesh and Maharashtra were the other two states where ONGC was considering wind energy units.
Initiated by the ONGC Energy Centre Trust, ONGC is working on 3 projects namely a thermo chemical reactor for hydrogen, geo bio reactors and fuel cells to develop renewable energy resources. It is also developing a 740 MW plant at Palathana in Tripura, primarily to utilise its idle gas reserves. The project is scheduled to be commissioned only by 2010.
Meanwhile, a Suzlon statement said the company would supply 34 units of Suzlon’s S82 1.5 MW turbines to ONGC for the project in Kutch. The order also covers operation and maintenance for the project for a period of 10 years.
ArcelorMittal looking for technology partner
Mr Malay Mukherjee group management board member of ArcelorMittal said that it is scouting for an information technology partner to support its back end operations in emerging markets such as India and China.
Mr Mukherjee said that the partnership if formed would encompass IT solutions in energy management processes, synchronizing daily operations, data management, creating graphic models for engineers in designing processes and online measurement of mechanical properties.
When asked about the outcome of his meeting with Mr B Ramalinga Raju chief of Satyam Computer and the likelihood of forging a deal with the company on IT partnership, Mr Mukherjee said that “We discussed the various challenges being faced by the steel industry and how IT industry could provide solutions to key concerns.”
Chhattisgarh cancels water allocation to Sipat project II
Chhattisgarh government has withdrawn the water allocation to National Thermal Power Corporation's Sipat super thermal power project stage II in Bilaspur district after the union power ministry refused to heed its demand of 300 MW of power from the upcoming unit, instead of 158 MW of power currently.
NTPC took up the matter with the state administration and senior officials from the corporation met the state principal secretary energy. However, the state government is insisting on the assured 300 MW allocation from the unit before releasing water required for commissioning and operating the Sipat project.
Senior NTPC officials said that the ministry had assured to divert all unallocated power from Sipat to Chhattisgarh till its requirement was met and NTPC has now decided to request the power ministry to take up the matter with the state government.
Work on IPI pipeline to begin by March 2008 – Report
India has expressed confidence that the work on the proposed USD 7 billion Iran Pakistan India gas pipeline project will start by March 2008 as it is hopeful of finalizing a transit fee agreement with Islamabad before that.
Mr MS Srinivasan union petroleum secretary said that India is confident of starting work on the 2,775 kilometer long IPI project by the end of March 2008. He added that talks with Pakistan to iron out differences on the transit fee issue were stopped due to political developments in Pakistan and negotiations would be resumed soon.
He said “India has already discussed the issue of gas price and transportation charges with Pakistan and only the transit fee issue remains to be solved.”
Bombay HC clears land acquisition for REL power project
BS reported that Reliance Energy Limited’s 4,000 MW coal and gas based power project at Shahpur near Alibaug in Raigad district of Maharashtra has received a shot in the arm as a division bench of the Bombay High Court comprising justice Mr JN Patel and Ms Nisha Mhatre allowed the state government to go ahead with the land acquisition process.
The court has, however, restrained the state government from taking physical possession of the land till further orders. However, government counsel Mr Pradip Patil, brought it to the notice of the court that the project had received a clearance from the ministry of environment and forests.
It is noted that the organization of local farmers Shetkari Sangharsh Samiti had filed a PIL in the Bombay High Court challenging the state government’s decision to acquire the land on grounds that the project violates coastal regulatory zone and environmental norms.
Earlier, the divisional commissioner of the Konkan region suspended the public hearing and resorted to special provisions of the land acquisition Act as the state was facing acute shortage of power. The court has now set the next date of hearing for the case on January 16th 2008.
The project has already been delayed by more than a year as REL and TATA Power Company got involved in a row over the land due to negligence of the state government machinery. While REL approached the state government’s revenue department for its land requirement, TPC approached the state government’s industrial infrastructure arm Maharashtra Industrial Development Corporation. Both the agencies identified land at the Shahpur village for the project. While REL wanted around 3,000 acres for its 4,000 MW plant, TPC sought around 1,000 acres for its 1,600 MW plant.
Now, according to the solution arrived at by the state government, REL in the first phase will take up 1,400 MW coal based project. The state government would help REL find land for the 2,600 MW gas plant once the company makes arrangement for gas.
MNCs in India more profitable than in China - FM
Mr P Chidambaram union finance minister, comparing the capabilities of India and China in services and manufacturing respectively, emphasizes the need to excel in manufacturing sector.
Mr Chidambaram said that “China is known as manufacturing hub and India, the service provider to the world. Why it should be so? India should also progress in manufacturing.”
Terming that multinationals operating in India are much more profitable than those in China, he said that “73% of MNCs gave consistent returns to their investors, while those in China gave only 40% to their investors. When China can build world’s tallest building, largest stadium and deepest harbour, why can not India dream big and scale up its operations.”
He further added that “We have 301 projects delayed in India between 1 month to 196 months with a cost overrun of INR 49,967 crore and it is a grave cause for concern.”
BHPB bid for Rio - Japan shows concerns
Asahi newspaper reported that Japan's Fair Trade Commission is worried about a BHP Billiton takeover of Rio Tinto and has begun talks with counterparts in Europe and Australia about a possible investigation.
The Asahi newspaper said the Japanese watchdog was likely to talk with counterparts in South Korea and Taiwan, countries which also have steelmakers highly dependent on the miners.
Japan's Iron and Steel Federation, which represents companies such as Nippon Steel Corp and JFE Steel Corp had earlier said that it vehemently opposes the proposed merger, arguing that it would be anti-competitive.
Rio Tinto approves feasibility study for new Hope Downs mine
The Hope Downs JV, which is managed by Rio Tinto, has approved a feasibility study to expand the Hope Downs 4 project as part of the Rio Tinto program to reach a Pilbara annual capacity of 320 million tonnes of iron ore by 2012.
The study, which will cost an estimated USD 71 million, will assess the deposit as an extension of the existing Hope Downs JV, 50:50 owned by Rio Tinto and Hope Downs Iron Ore Pty Ltd. The study will incorporate the recently completed 50,000 meter in fill drilling program at Hope Downs 4.
The Hope Downs 4 deposit is located 35 kilometers northwest of the town of Newman and 45 kilometers east of the Hope Downs 1 mine. This mine began production in November 2007 and is expected to reach 30 million tonne capacity in early 2009.
The Hope Downs 4 deposit consists of three main areas of mineralization of approximately equal size extending over a length of eight kilometers. The deposit has been re-estimated after completion of an 18,000-metre in-fill drilling program in 2006. The contained high grade Resource (>=60% Fe) is made up of 98.6Mt @ 62.3% Fe of Indicated Mineral Resource and 206.1Mt @ 62.4% Fe of Inferred Mineral Resource.
A range of government and environmental approvals would be required before development of a Hope Downs 4 mine could proceed.
Mr Sam Walsh CEO Rio Tinto Iron Ore said "The Hope Downs 4 deposit offers excellent potential as part of our extension into the east Pilbara region, especially as we ramp up towards 320 million tonne per annum capacity over the next five years. This potential highlights the degree of flexibility that Rio Tinto enjoys to capitalize on existing infrastructure through the development of new world-class mines. This is an advantage that we emphasized in our annual investor presentation on 26 November."
Mrs Gina Rinehart chairman of Hope Downs Iron Ore Pty Ltd said "Following on from our initial pre-feasibility studies, we hope the expanded study will successfully support our vision for the area, which includes more mines being developed adjacent to Hope Downs 4, and the extension of the Lang Hancock Railway to them."
CSN plans 3 for 1 stock split to increase trading
Bloomberg reported that Brazil's Cia Siderurgica Nacional SA planning to split its stock 3 for 1 to increase trading of the shares. The board approved a plan to give investors two new shares for every one they hold.
Rio de Janeiro based CSN in a statement posted on the Brazilian securities regulator's Web site said that American depositary receipts will continue to represent one common share each.
Mr Augusto Lange who helps manage USD 850 million at Neo Gestao de Recursos in Sao Paulo said that “This will be good to increase liquidity. It could pulverize shareholder control a bit, but the main point is to increase liquidity.''
CSN's shares gained BRR 3.89 or 2.6% to BRR 153.89 on the Sao Paulo stock exchange. The more than doubled in the past year, compared with a 44% gain for Brazil's benchmark Bovespa index.
CSN didn't say when it will split its shares. The split needs shareholder approval.
Brazilian MMX starts building pig iron plant
Reuters reported that Brazilian iron ore miner MMX has started construction of a 2 million tonne per year pig iron plant, which will be Brazil's largest merchant pig iron plant.
The pig iron plant will use iron ore from the MMX Amapa mine in northern Brazil, which started production earlier this week after gaining an operation license from the Amapa state environment authority.
MMX Mineracao e Metalicos SA said the pig iron plant will produce 1.5 million tonnes per year of pig iron for export and the remaining 500,000 tonnes per year will be used to feed a planned steel smelter. It added that the steelmaking plant will produce billets, probably also destined for export. The pig iron plant and steel mill should start up in 2008 and 2009 respectively.
MMX said that its planned investment in the entire Amapa complex, including the mine, pig iron plant, steel smelter, port and railway infrastructure, is USD 1 billion.
The mine will produce 4.8 million tonnes of iron ore in 2008, rising to full capacity of 6.5 million tonnes from 2009. Its output, apart from what will be needed in future to feed the pig iron plant, will be exported in full to Bahrein's Gulf Industrial Investment Co for iron ore pellets production under a 20 year contract.
Queensland Port to become world's biggest coal export facility
According to Ms Anna Bligh Premier of Queensland central Queensland port could be turned into the biggest coal export facility in the world.
As per report the Central Queensland Ports Authority and Xstrata are carrying out a feasibility study into whether Port Alma, south of Rockhampton, could become a major port, exporting 30 million tonnes of coal annually.
Ms Bligh said that the possible expansion would not adversely affect the various Gladstone Port developments. She added that "The Port of Gladstone is set for a significant number of expansions over the next decade and nothing will change that.”
She said that "Port Alma, if we can open it up, will be on top of Gladstone's expansion." She added that if the project is approved, it will mean more jobs and opportunities in the region.
BHPB announces sale of Falcon Technology
BHP Billiton announced that it has agreed to sell its Falcon™ geophysical technology to Fugro NV. The Falcon technology, jointly developed by BHP Billiton and Lockheed Martin, is deployed on aircraft operated by Fugro Airborne Surveys.
BHP Billiton will retain exclusive use and priority access to the technology for minerals exploration until March 2010. Final completion of the sale is subject to the satisfaction of conditions precedent and it is anticipated that execution of the sale agreement will be completed by March 2008.
Mr Ian Maxwell vice president of BHP Billiton Minerals Exploration said that "We have a long and productive relationship with Fugro Airborne Surveys and through this agreement we will continue to use Falcon™ technology through a world class geophysical service provider, as we focus our efforts on discovery of new mineral deposits.”
Allegations of undue pressure of contactors at Hobart smelter
Zinifex confirmed that it has received a statement of claim from the Workplace Ombudsman alleging undue pressure to four contractors at the then Zinifex Hobart Smelter in 2005.
Mr Tony Barnes acting CEO of Zinifex said that "We share the Ombudman's view that duress to any workers in connection with their working conditions is intolerable.”
He added that "Put simply, this is not the way Zinifex conducts its business. It is contrary to our values and the way the company conducts its high standard of workplace relations.”
Mr Barnes said that Zinifex has only recently received the notice and that the company is taking the allegation extremely seriously. He added that "We are currently investigating the circumstances of the allegations and will then determine what is the appropriate course of action.”
Northwest Pipe announces USD 7 million order
Northwest Pipe Company announced that it has received a verbal commitment from Oscar Renda Contracting of Roanoke, Texas for the Reuse Pipeline and Diffuser to Lake Lanier Contract 3 project for the Gwinnett County Department of Water Resources near Atlanta in Georgia.
The Company will supply approximately 6,500 feet of mostly 72'' steel pipe and engineered fittings. The pipe is expected to be manufactured in the Company's Parkersburg, West Virginia division with delivery scheduled to begin in the second quarter of 2008.
Northwest Pipe Company manufactures welded steel pipe and other products inthree business segments. Its Water Transmission Group is a leading supplierof large diameter, high pressure steel pipe products that are used primarily for water infrastructure in North America. Its Tubular Products Group manufactures smaller diameter steel pipe for a wide range of construction, agricultural, energy, industrial and mechanical applications. Its Fabricated Products Group manufactures propane tanks and other fabricated products. The Company is headquartered in Portland, Oregon and has ten manufacturing facilities across the United States and Mexico.
Carpenter Technology announces new share repurchase plan
Carpenter Technology Corporation announced that its board of directors has approved a new share repurchase program of up to USD 250 million of Carpenter's outstanding common shares.
Mr K Douglas Ralph senior vice president (finance) & CFO said that “The new share buyback plan is a follow on to our current USD 250 million repurchase plan and a continuation of steps in our strategy to effectively deploy excess cash to improve shareholder value. The new plan is effective upon completion of our existing buyback plan, which is essentially completed."
Repurchases under the new program will be funded with available cash and made from time to time in either the open market or through private transactions. The timing, volume and nature of share repurchases will be at the discretion of management, dependent on market conditions, other priorities for cash investment, applicable securities laws and other factors and may be suspended or discontinued at any time.
Harsco makes controller and human resources management appointments
Worldwide industrial services company Harsco Corporation announced the promotions of Mr Richard M Wagner to vice president & controller and Mr Gerald F Vinci to vice president human resources Americas, both effective January 1st 2008.
With his appointment, Mr Wagner will succeed Mr Stephen J Schnoor as principal accounting officer of the Company. As previously announced, Mr Schnoor will become senior vice president & CFO effective January 1st 2008 as part of the Company's planned management succession announced earlier this year.
Mr Wagner joined Harsco in July 2007 and has been serving as assistant controller since that time. Prior to joining Harsco, Mr Wagner held management responsibilities for financial reporting at Bayer Corporation in Pittsburgh. He previously held a number of financial management positions both in the US and internationally with Kennametal Inc and also served as an audit manager with Deloitte & Touche. Mr Wagner is a Certified Public Accountant and a graduate of Pennsylvania State University with a degree in Accounting.
Mr Vinci joined Harsco in January 1997 and has served as senior director, human resources and employment counsel. In his new position, Mr Vinci will provide strategic oversight to the Company's human resources policies and practices throughout North and South America. Prior to joining Harsco, Mr Vinci was an attorney in the legal department of Sun Company, Inc. He is a graduate of Villanova University and the Temple University School of Law.
Harsco Corporation is one of the world's leading diversified industrial services companies, serving major customers in the construction and infrastructure, steel and metals, energy and railway industries.
Japanese EAF crude steel output in October hit 2.71 million tonnes
YIEH reported that Japanese crude steel output from electric furnaces in October 2007 was 2.71 million tonnes up by 0.5% YoY as compared to October 2006 and it totaled 25.67 million tonnes from January to October 2007, showing a rise of 2.9% YoY as compared to January to October 2006.
Other major producer of steel in October 2007 are
1. Nippon Steel was 47,362 tonnes
2. YAKIN was 26,465 tonnes
3. Hitachi Metals was 18,735 tonnes.
Update on Timah CAPEX plans
It is reported that in recent days PT Timah executives have given further details of the Indonesian state controlled tin company’s capital expenditure plans for 2008.
The report added that total capex next year is expected to rise to IDR 800 billion (USD 86 million) from IDR 300 billion in 2007. Around IDR 400 billion is to be spent on the acquisition of six new tin dredges, while IDR 200 billion is allocated to the construction of two solder plans on Bangka and Kundur islands and a tin chemicals operation on Bangka.
All the downstream tin units are expected to start production in 2009. The other main investment next year is the construction of an asphalt plant at a cost of IDR 150 billion.
Timah is also looking at acquiring a coal mine in Kalimantan or Sumatra as part of its diversification strategy and to boost its current small coal reserves.
USA steel prices show slightly bouncing back in November
YIEH reported that The American steel prices climb slightly generally in November due to the slump of steel inventories and imports. The exception is rebar price, which is going down a bit.
It is reported that several major steelmakers in America are planning a price hike of USD 30 per tonne in January, 2008 on the increase of raw material cost. However, since the market demand still remains flat, the practice of price increase has not been finalized.
The report further added that currently, the HR sheet price at Mid West region hangs around USD 532 per tonne while the CR sheet is kept at about USD 613 per ton. For long products, the rebar is marketed at USD 574 per ton, which is down by USD 2 per ton than last month.
Warwick identifies new iron ore target at Jimblebar
Australian Business News reported that diversified Pilbara explorer Warwick Resources Ltd has identified a substantial new iron ore target at Jimblebar Range within the company's wholly owned Jimblebar project tenements near Newman.
Jimblebar Range is 1 kilometer to the southwest of Warwick's Jimblebar channel iron deposit and only 8 kilometer from BHP Billiton Ltd's large Jimblebar iron ore mine and railway. The discovery is the third high-quality iron ore target Warwick has identified since listing and continues the success from its aggressive early exploration programs.
Mr Bruce McQuitty MD of said recent mapping and rock chip sampling undertaken by a consultant geologist had outlined strong iron enrichment over an area in excess of 250,000 sq m. He added that “The results include grades to 64% Fe and low to moderate levels of contaminants, which indicates potential for direct shipping ore. Our continued success has prompted us to engage an experienced consultant to expedite the generation of further iron ore targets.”
Mr McQuitty said that "We are reviewing all of our projects for their iron ore potential, given their proximity to existing iron ore mines and infrastructure.”
Canadian nickel junior declines to put itself up for sale
Metals Insider reported that Canadian nickel junior FNX will not put itself up for sale, as suggested by a major shareholder York Capital, which holds a 19.37% stake in the company.
York had written to the board of FNX saying it believed “there may be significant corporate interest in FNX and any evaluation of strategic alternatives would attract multiple suitors.”
FNX said that it had considered York’s proposal but decided “it would not be in the best interests of the Company’s shareholders to run a public process to sell the company. It added that “FNX has successfully put two mines into production and expects to achieve commercial production at a third mine early in 2008.”
FNX said that “The company has made several material discoveries and is poised to bring two of its highest margin ore deposits into production. The board believes that, at this time, following through on our current production plans and exploration successes is the best way to maximize shareholder value.”
Japan shipbuilding orders take a dive in November
The Japan Ship Exporters Association said that Japanese shipbuilders received orders for vessels with a combined gross tonnage of 2.6 million tonnes in November 2007, down by 61.5% YoY.
The Association said that the comparative orders received last month were for 39 bulk cargo ships with a combined gross tonnage of 1.6 million tonnes, 12 oil tankers with a combined gross tonnage of 363,300 tonnes and seven general cargo ships with a total gross tonnage of 601,800 tonnes.
Kalpinis Simos cuts earnings guidance for '07
It is reported that Greek steel products maker Kalpinis Simos cut its earnings guidance for 2007 due to lower selling prices and the change in steel prices on the international market.
Kalpinis Simos in a statement said that it downgraded its estimates for the consolidated earnings before interest, tax, depreciation and amortisation to between EUR 19.2 million (USD 28.1 million) and EUR 19.8 million from EUR 21.4 million. Its EBITDA growth is seen at 25.5% to 29.5% from 2006.
It added that it also trimmed its net profit forecast to between EUR 9.5 million and EUR 10 million from EUR 10.5 million previously. It expects a 53.2% to 61.3% annual rise in net earnings
Sumitomo raises prices on domestic stainless steel pipes
Japan’s Sumitomo Metals said it raising prices on all domestic sales of nickel based seamless stainless steel pipes by 20% effective this month’s contracts.
Sumitomo Metals in a statement said that this change applies to all domestic sales of nickel based seamless stainless steel pipes, including spot sales, sales to rerollers and long term contract sales. It added that its production is running at near capacity levels thanks to strong demand both domestically and from the export market.
Reason for price increase
1. Demand from energy related companies (power plants, oil refineries, petrochemical plants, and oil fields) for seamless stainless steel pipes is high. Accordingly, production remains at near-full capacity. Inquiry from overseas is strong as well, particularly for boiler tubes used by coal-fired thermal power plants. As a result, export prices exceed domestic prices by a large margin.
2. Due to the above, Sumitomo Metals believes it must raise its price for seamless stainless steel pipes in order to ensure a stable supply to domestic customers.
Jeddah Islamic Port's capacity to rise by 45%
Khaleej Times quoted Dr Khaled bin Ahmed Boubasheet president of the Saudi Seaports Authority as saying that Jeddah Islamic Port's capacity will increase by 45% because of the new container terminal, which will commence in January 2008. This state of the art container terminal will serve the new generation of ocean going containerships and will incorporate world class equipment and infrastructure.
The consortium behind the project includes publicly owned Saudi Industrial Services Company and its affiliate, the Saudi Trade & Export Development Company, the Saudi industrial group, Xenel and the Malaysian MMC Corporation.
Mr Boubasheet said that the new terminal named Red Sea Gateway will be completed within 22 months at a cost of SAR 1.6 billion and added that it would receive the first container ship in the last quarter of 2009. He added that the Red Sea Gateway would be a qualitative development in the Kingdom’s container terminal projects.
Mr Aamer A Alireza CEO of Red Sea Gateway Terminal said that "We undertook a thorough exercise to choose the best name that will reflect our company’s vision, values and positioning."
Red Sea Gateway will have a handling capacity of 1.5 million containers annually. It will have a shipyard with a depth of 18 meters, an approach channel, a separate feeder berth, and provision for Saudi Land Bridge connectivity.
Pakistan looking at alternate energy resources
Pakistan’s energy officials said that, owing to the alarming energy crisis in Pakistan, the supply has to be substantially increased to avoid any severe consequences. The massive shortage of energy Pakistan is facing is damaging the socio economics and the sovereignty of the country.
They said that as the economy grows, population increases and urbanization surges, the demand for energy registers a steep rise. Therefore, the challenges of rising energy demand come to the center stage, especially because the gestation period for generating energy for different sources is large and financial requirement huge.
The officials of ministry of petroleum and natural resources said that “Presently, Pakistan meets its 75% energy requirement from domestic resources. We meet 50.4% requirement through indigenous gas supply and 12.7% through hydro electricity. Contribution of coal and nuclear energy is limited to 7% and 1% respectively.”
Pakistan’s major energy consumption sectors are
1) Industrial: 38.3%
2) Transport: 32.8%
3) Residential & commercial: 25%
4) Agriculture: 2.5%
5) Others: 2.2%
During the last 10 years, the consumption of petroleum products has decreased at an average of 0.4% per annum due to lower consumption of oil in the household and agriculture sector. The consumption of gas, electricity and coal has increased at an average rate of 7.8%, 5.1% and 8.8% per annum, respectively. During this period, the transport sector was the largest user of petroleum products, on average accounting for 50.7% of consumption, followed by the power sector with 32.1%, industry with 11.4%, government with 2.3%, household with 2.2% and agriculture with 1.3%.
The officials said that crude oil supply grew at 2.4% per annum during the last 10 years reaching 87.5 million barrels output in 2006-07. Gas supplies rose at 7.8% per year, petroleum products by about 2% per year, coal by 5.7% per annum and electricity by 5.1% per annum.
Pakistan is seeking to explore alternative sources of energy production and use wind and solar technologies with the aim to produce 9,700 MW wind power by 2030, thereby providing electricity to 7,874 off grid villages in Sindh and Baluchistan. Pakistan government is giving top priority to hydel power with the potential of producing 40,000 MW power of which only 15% had been exploited so far. The coal based power generation was being given serious consideration to diversify the energy resources, to minimize the rising cost of imported fuel and to supplement the fast depleting gas resources.
Kuwait Petroleum extended deadline for bids
Kuwait has extended a deadline for bids for a refinery contract until December 26th 2007 from the earlier deadline of December 16th 2007.
Mr Saad Al Shuwaib CEO of Kuwait Petroleum Corporation said that “The bids are for December 26th 2007 and we will take 2 months to evaluate. Then we will do our job and decide.”
It is noted that Kuwait Petroleum’s refining unit Kuwait National Petroleum Co is planning a USD 14.3 billion refinery at Al Zour with capacity to produce 615,000 barrels a day when completed in 2012.
Korean firms GS Engineering & Construction, SK Engineering & Construction and Foster & Wheeler, the Hamilton, Bermuda based designer and builder of oil refineries are in the running for the bid.
Abu Dhabi’s processing industries in reached AED 91 billion
According to Abu Dhabi department of economy & planning’s survey for the processing industries in the emirate, the total value of the annual production of processing industries in Abu Dhabi reached AED 91 billion of which chemicals and plastics accounted for 88%.
The survey said that "Abu Dhabi zone accounted for 97.5% of the total production and 97.8% of the value added, while Al Ain accounted for 2.3% of the production and 2% of the value added."
Mr Mohammad Omar Abdullah the department's undersecretary said that "We have carried out this survey within the framework of developing the industrial sector of the emirate and providing for the detailed data required to promote investments in Abu Dhabi. Industrial production is beginning to acquire a substantial stake in the emirate's gross domestic production and this survey aims to identify the capacity and realities of the sector, while helping in overcoming hurdles standing on the way of its development."
Mr Butti Al Qubaisi department's assistant undersecretary said that "The preliminary data included 4,636 establishments employing more than 66,000 workers." He added that the invested capital totaled about AED 6.5 billion, out of which 84.5% is local investment and foreigners contributed 15.5%.
There are 66,792 workers with an average of 14.5 workers per establishment, of which 28.2% are employed in the manufacturing tools and machinery sector. Chemicals and plastics employed 16.9% of the workers. About 96.5% of the workers in Abu Dhabi's processing industries are foreign nationals, while 3.5% are locals working mainly in the chemicals sector. Total annual salaries, wages and incentives were about AED 2.7 billion, with an average of AED 40,900 per worker.
Gazprombank shows interest in Red Sea gas exploration
Khaleej Times reported that Gazprom’s subsidiary Gazprombank is interested in participating in the Red Sea gas exploration when Saudi Arabia floats tender for the project.
Mr Boris Ivanov adviser to the chairman of Gazprombank said that "We are also studying what we can do in collaboration with Saudi Aramco." He added that the company would definitely be interested in any Saudi initiative for exploring gas in the Red Sea.
Mr Ivanov, underlining his bank’s commitment, disclosed that 2 Russian investment funds in the energy and real estate sectors collectively worth USD 6 billion are targeting Saudi investors. He added that Russia Energy Fund and the Russia Real Estate Fund were valued at USD 5 billion and USD 1 billion respectively.
Mr Ivanov said that "We worked hard to launch these two funds which were facilitated by the good political relations between Russia and Saudi Arabia." He added that Al Meleihi had already committed USD 100 million to the Real Estate Fund, while others were also pitching in.
He said Gazprombank would explore the possibility of establishing its presence in the Kingdom where, besides the oil and gas sector, there were tremendous opportunities in the light of the economic cities and other mega projects that had been launched or are in the pipeline. He added that "There is a great deal of interest among Saudis. We have received various commitments that are being evaluated. We are also short listing companies that will help us manage the fund."
Pak China Investment Company to launch on December 27
Business Recorder reported that Pakistan’s Investment Division & Board of Investment will hold launching a ceremony of the Pakistan China Investment Company at the governor's house on December 27th 2007. Pakistan and China have set up joint stock company Pak China Investment Company with an initial capital of US USD 200 million.
The new company is to promote and finance industrial ventures and investment projects involving Pakistani and Chinese investors.
Sweet Homes plans to invest AED 2 billion in MEA real estate in 2008
Khaleej Times reported that UAE based Sweet Homes has announced its plans to invest AED 2 billion in the region's property sector in 2008, through a series of launches of high profile residential, commercial and mixed use developments.
As a part of the developer's expansion plans for penetrating the USD 2.4 trillion Middle East real estate market, Sweet Homes has also announced plans to launch new developments in the other emirates of the UAE and in the neighbouring states of Qatar, Oman, Saudi Arabia and in other parts of GCC. The move follows the recent launch of the AED 2.5 billion Ajman Uptown project, the first freehold villa and townhouse community in the emirate of Ajman.
With a current project portfolio valued at AED 3.5 billion, including its two primary projects Rainbow Towers and Ajman Uptown, Sweet Homes has identified the progressive emirates of Dubai and Abu Dhabi as key markets to penetrate within the first phase of its regional expansion plans. The developer is positive that its future projects within the UAE will exceed the accomplishments achieved by its previous ventures, thereby extending its strong reputation in Ajman and building a significant presence across the entire country. Following the first phase of investment, Sweet Homes will be embarking on a region-wide expansion plan, which will cover Qatar, Oman and Saudi Arabia.
Mr Fahad Sattar Dero CEO of Sweet Homes Group said that "The Middle East presents an enormous array of opportunities within the highly dynamic real estate market, which has attracted an influx of local, regional, and international developers all vying to get a their own prominent standing in the market. With our success in the property development arena in the UAE reaching new heights, the next step for us is to seek more prospects in the regional market by launching unique projects through highly localized marketing plans. We have been greatly inspired by the performance and the interest generated by our latest venture, Ajman Uptown, and we are now looking forward to our customers' expectations and further build a the reputation of Sweet Homes in this highly competitive market."
Sweet Homes plans to leverage its extensive regional experience in the promotion, marketing and overall management of several high profile projects such as International City, Rufi Twin Towers, DEC Towers, Al Naemiyah Towers, Al Khor Towers, Corniche Towers, Falcon Office Tower and Falcon Residential Tower. In addition, the company has also announced its plans to expand its roster of high value offerings to include contracting, engineering consultancy, feasibility studies and research, and funds management, which are being developed to deliver excellent after sales services and ensure customer satisfaction.
Mr Dero said that "The past 4 years have witnessed tremendous growth for Sweet Homes in terms of investments as a developer, in addition to the significant expansion in our offered services, which now covers almost the entire management, promotion and purchase processes for both real estate companies and customers. In our focus to emerge as one of the frontrunners in the market, we are exerting all our efforts to provide value added services and utilise our highly specialized resources such as our in house media communications arm to fully develop our company as a key brand."
Sweet Homes has launched two prime residential projects in the UAE, namely the Rainbow Towers and the recently launched Ajman Uptown, which was unveiled in November 2007. The project covers four million square feet of land. The villas and townhouses boast of classic French architecture accentuating the overall theme of the project, which is 'L' Art De Vivre' or 'Redefining the Art of Living'.
China confirms increase in export tariffs on coal and steel in 2008
Chinese ministry of finance announced on Friday that China will impose or raise export duties on products including wood pulp, coke, alloy steel, steel billets, and some finished steel products in 2008. The ministry added that China will also impose temporary export tariffs on coal, crude oil, and metal ores in January 2008.
It said “The move aims to rein in the rapid expansion of the industries that consume more energy and discharge more pollutants. Starting from the New Year's Day, such energy intensive and high polluting metallurgical products as coke, ferroalloys, steel billet and part of finished steel products will be subject to either fresh imposition or further elevation of export taxes/”
Further details were not providing.
In addition, China will next year levy lower temporary import duties on more than 600 kinds of products including crude oil, coal, key equipments and component parts, doubling the figure of last year, amid efforts to trim the trade surplus and optimize economic structure. It said that China will impose special preferential tariffs on some exports from 39 African, Southeast Asian and Mid-east nations.
The ministry added the nation's general tariff level for 2008 will be held at 9.8%t, with the tariff level for farm produce at 15.2% and that for industrial products at 8.9%.
CISA declares iron ore supply demand situation of 2008
Mr Luo Bingsheng VP and secretary of China Steel Industry Association firstly for the first time made a detailed analysis the international iron ore’s seaborne trade market supply and demand situation of 2008.
Mr Luo estimated that in 2007, China's blast furnace pig iron production is about 465 million tonnes up by 12.4% YoY, the total domestic iron ore is about 800 million tonnes up by 15.9% YoY, the imported iron ore is about 375 million tonnes up by 14.9% YoY.
He estimated that in 2008, china’s pig iron output will be about 505 million tonnes, increasing iron ore consumption about 63 million tonnes, while total domestic iron ore will increase 80 million tonnes, converting into furnace ore concentrate 38 million tonnes. The difference will be supplied by imported iron ore. In 2008, in the iron ore’s seaborne trade market, the producers will increase supply about 70 million tonnes, but the global demand will increase about 60 million tonnes, overall the supply and demand are basic balance.
He further added that “We also fully take into account 3 major mining companies which monopolize the supply of resources, they have the ability to change the supply and demand relations.”
China's steel export may rebound in December - Report
China Securities News reported that China's steel export tonnage may regain strength in December 2007 following drastic decline for 2 straight months. The reason is that Chinese steel producers and traders are now hastily arranging for materials to ship as soon as possible, to avoid losses should the central government make further changes to steel export policies.
Many industry pundits believe that China will adjust steel export rebates and taxes across a range of products from January2008. The export duty on billet, ingot, pig iron and other preliminary products would be lifted from 15% to 25% and the tax on HRC, long products export to be raised from 5-10% to 15%.
It is noted that Chinese government has revised export tax for 4 times so far in 2007 in a bid to rein in shipment of high energy consuming and high polluting products. The impact has been increasingly felt as its crude steel export falls back in October and November 2007 from April's peak of 8.44 million tonnes.
Mr Luo Bingsheng deputy secretary general of China Iron & Steel Association said that "It remains unclear whether the steel export would spread into the months ahead. If not, the authority is likely to roll out further export tax changes. The related government bodies have already met together discussing the possible tax change on steel exports. However, the export quotas scheme has yet to be brought on the agenda."
Masteel to produce steel 16.9 million tonnes in 2008
According to Masteel that it will accelerate changing the development mode next year, make efforts to produce 16.9 millions steel, variety steel accounts for 70%, exploit new products 2.8 million tonnes, realize the sales revenue to exceed CNY 60 billion.
As per reports, Masteel next year’s main measures are to enhance the variety quality as the key and to improve the profitability of tonnes of material as the core.
Chinese crude steel exports may fall in 2008 due to curbs - CISA
Mr Luo Bingsheng VC of the China Iron & Steel Association said that crude steel exports are likely to fall by 20 million tonnes in 2008 as a result of government curbs. He added that "Expanding exports is not the industry's development objective. We should insist on satisfying the domestic market and carry out government policy this year to further check steel exports."
Mr Luo also said that the authorities are looking into introducing a steel export tariff in 2008, but there's no clear time table. He added that "Total exports of crude steel this year are expected to be around 72 million tonnes, accounting for 14.8% of the whole year's output of 490 million tonnes."
Mr Wu Jiahuang a researcher with the China Institute of the WTO has agreed that steel product export figures for the past 5 years were too high. He said "After China's entry to WTO, total exports increased at an annual average of 29%. But the average growth rate for steel product exports was 60%."
But the risk of anti dumping tariffs has prompted measures to curb steel exports as part of the push to cut the trade surplus and ease friction with other countries. In April 2007, China reduced export tax rebates for 76 steel products from 8% to 5% and removed tax rebates on another 83 categories. Again in July 2007, it slashed export tax rebates for 161 steel products from 11-13% to 0-5%. That move came a month after the nation imposed 5% to 10% export tariffs on 82 steel products and raised duties on exports of another 19 categories from 10% to 15%.
Shaanxi requires outdated steel facilities to be dismantled
According to sources from the provincial development & reform commission of Shaanxi, Shaanxi Province will strengthen the efforts to shut down and eliminate outdated capacity in the local steel industry. To prevent outdated facilities from avoiding eliminations, the removed facilities are required to be dismantled as ferrous raw materials. Outdated small blast furnaces are not required to transform production of casting pipe and ferroalloy.
Enterprises that failed to meet emission standards will be ordered to suspend operations immediately by the environmental protection departments and those failed to eliminate outdated capacity will be withdrawn their business licenses by the industry and commerce departments or be revoked their production permits by the quality assurance departments. Furthermore, power and water supply departments must take measures to cut electricity and water supply for those companies to force them to retreat from the market.
China’s steel industry’s economic benefits hit a new record – CISA
Mr Wu Xichun adviser of China Steel Industry Association announced that, in 2007 China’s steel industry’s economic benefits hit a new record, large and medium sized iron and steel enterprises’ profits expect to realize more than CNY 144 billion up by 57% YoY.
Mr Wu said that in 2007, both domestic and international steel markets’ demand are big, the steel production and market price are rising to a new record, the export volume of Chinese steel reaches a new record, imported iron ore’s price and freight have greatly increased.
Under the domestic and international market double pull in 2007, the total output of Chinese steel expects to reach 4.9 billion tonnes, increase by 70 million tonnes compared with last year’s, about 50 million tonnes for domestic additional demand, 20 million tonnes for expanding exports.
OMZ Spetsstal obtains RINA certificate
FIS reported that OMZ Spetsstal, the member of United Machine Building Plants has obtained the certificate of the Italian Certification Society Registro Italiano Navale on the production of forgings from carbon, carbon magnesium steels of the maximum weight of up to 230 tonnes. The certificate will be effective until November 15th 2010.
The granted certificate is one more proof of the high quality of the OMZ Spetsstal's products for the shipbuilding industry.
Control Components to start Ukrainian coal project in 2008
Journal Staff reported that Australia's Control Components in 2008 will start building a first mine at the Liubelia coking coal field.
Mr Petro Oliynyk head of the Lviv regional state administration said that the explored deposits of the Liubelia coking coal field are 86 million tonnes, and the mine' capacity should be 2.1 million tonnes per year. He said that the project is estimated at UAH1.5 billion.
Toyota opens new car plant in St Petersburg
It is reported that Japanese auto giant Toyota will open a USD 160 million factory at St Petersburg in northwest Russia producing 20,000 cars per year.
The plant, producing Toyota Camry mid size cars, will employ around 600 staff. Its annual output could be raised to 50,000 in the next few years, and eventually to 200,000.
The agreement to build the facility was signed in April 2005 by Toyota, the Russian government and the St Petersburg administration.
Gazprom Neft reports net profit in 9 months at USD 2.8 billion
Gazprom Neft, the oil arm of Russian energy giant Gazprom said that its US GAAP net profit had already reached last year's level of USD 2.8 billion in the first nine months of 2007.
Gazprom Neft published its first US GAAP net profit report for the third quarter, as well as for January to September 2007, while its revenues dropped by 5.5% YoY in the reporting period to USD 15 billion.
The company's EBITDA grew by 4.6% YoY to USD 4 billion in January to September 2007 and its revenues in the third quarter of 2007 increased by 0.5% YoY to USD 5.4 billion.
Gazprom Neft in a statement said that "The drop in revenues followed changes in the company's sales structure. Owing to the high refining margin, Gazprom Neft increased its oil refining volumes and petrochemicals sales on the domestic market and simultaneously reduced the export of oil and petrochemicals.”
Gazprom and Italy's Eni hold 75% and 20%, respectively, in the oil company.
Iranian export to Russia increases
It is reported that Iran's exports to Russia from April to November 2007, period stands at USD 255 million.
The report cited Mr Mehdi Ghazanfari Iranian deputy trade minister at a conference on Tehran-Moscow economic cooperation in Tehran as saying that the country's main exports to Russia include food products, industrial machinery and furniture. He added that "Iran's imports from Russia have decreased from USD 502 million last year to USD 390 million in the first eight months of 2007.”
The volume of the trade between Iran and Russia reached USD 2 billion in 2006.
Nord Stream submits gas pipeline application to Swedish govt.
RIA Novosti reported that the operator of the Nord Stream gas pipeline has submitted an application to the Swedish government for permission to lay its offshore pipeline system within the Swedish Exclusive Economic Zone.
The ambitious project to build a pipeline under the Baltic Sea to pump Russian gas to Germany is being developed by Russia's state controlled gas giant Gazprom and Germany's EON and BASF at an estimated cost of $12 billion.
Nord Stream AG in a statement said that "The company has handed in an application for the construction of the pipelines, including a technical description in accordance with the Swedish Continental Shelf Act.”
It said it had also filed an application for the service platform and an Environmental Impact Assessment report as well as a study outlining the potential impact of the pipelines on the environment. The company said it views the submission of the applications as "a starting point for an intensive dialogue with the Swedish government regarding the permission procedure, as well as the scope and method of the environmental studies."
Based on the application, Nord Stream will discuss all relevant issues with authorities, organizations and the general public "in an open and transparent manner, while fulfilling all the requirements of Swedish legislation to obtain the required permits to construct the important infrastructure project."
It said the project timetable foresees pipe laying works on the first line commencing during the summer of 2009 with completion scheduled for 2010 and that the first gas deliveries are expected to start in the spring of 2011, after completion of the test phase.
Sintez gaz Ukrainy to invest UAH 120 million in energy projects
Mr Yevhen Sukhin the head of the National Agency of Ukraine for Efficient Use of Energy announced that Sintez gaz Ukrainy state concern in 2008 plans to invest at least UAH 120 million to launch energy saving technologies.
Mr Sukhin said that the state agency for investment and innovations gas agreed the issuing of a UAH 30 million credit to Kiev based Energoeffektivnost, which is part of Sintez gaz Ukrayiny with 7.5% interest.
Sakhalin 2 project gas supply delayed till spring 2009
Itar Tass reported that the liquefied gas will be exported not in 2008, as it was planned earlier, but in spring 2009 under the Sakhalin-2 project.
Mr Alexander Khoroshavin governor of the Sakhalin region told Itar Tass that “Some delays are taking place that make it clear that liquefied gas supplies will not be made in 2008. It will likely be spring 2009.”
