JSW Steel’s crude steel production up by 16% YoY in Nov ‘07

JSW Steel Ltd has announced that it has posted a growth in crude steel, HR coils, HR plates and pre painted galvanized coils of 16% YoY, 10% YoY, 88% YoY and 14% YoY respectively in November 2007 as against those of November 2006.

The break up of product wise production is as below

JSW Steel is engaged in the production and distribution of iron and steel products and generation of power. Its wholly owned subsidiaries include JSW Steel UK, JSW Natural Resources and JSW Steel Processing Centres.

Its upstream products include mild steel hot rolled coils, mild steel hot rolled plates and sheets and tolerances. While downstream products include hot rolled plates and cold rolled close annealed sheets and coils.

Railway hikes surcharge on iron ore export by 60% per tonne

It is reported that, within 2 months of increasing the congestion surcharge on iron ore traffic, Indian Railways has hiked the surcharge yet again to a whopping 60% per tonne with effect from December 1st 2007.

Earlier, the congestion surcharge was at 35% per tonne, which was effected from October 1st 2007, an increase of 14% points over the 21% surcharge level prevailing till September 2007. The 21% congestion surcharge was imposed on iron ore exporters from April 1st 2007 through a notification after the railway budget.

Meanwhile India’s iron ore exporters are up in arms against the move and represented to the union railway ministry against the hike and have also written to the union railway minister.

Officials of Federation of Indian Mineral Industries said that “The 60% surcharge is likely to hit the margins of iron ore export earnings by about USD 3 to 5 per tonne since Chinese buyers have refused to absorb any further hikes. We are exploring all possible options and will decide on our next step within the next 2 to 3 weeks.”

According to an Indian Railways notification, for all iron ore traffic being transported to goods sheds and sidings that serve the ports, a congestion surcharge of 60% would be levied. Apart from the congestion surcharge, iron ore exporters are also paying busy season surcharge of 7% with effect from October 1st 2007, when the Railways had increased the surcharge by 1 percentage point.

Moreover, a terminal charge of INR 40 per tonne of has been imposed on iron ore till March 31st 2008, apart from a development charge of 2%. With all these surcharges, for moving 1 tonne of iron ore on a 500 kilometer distance, exporters now have to pay about INR 987 compared to the base tariff of INR 554.70 as announced in the budget.

DP Jindal Group’s MSL buys seamless plant in Romania

Maharashtra Seamless Limited, the flagship company of seamless pipes manufacturer DP Jindal Group has announced that it is buying another seamless plant in Romania having a capacity of 200000 tonnes per annum for about INR 600 to INR 700 crore. The move is aimed at doubling MSL’s capacity to 700,000 tonnes by 2010-11 and plans to add another 150,000 tonnes by de bottlenecking the existing capacity.

With the acquisition, MSL will get access to the European and the Middle East markets. The acquisition would be completed in two weeks and it is likely to finance the acquisition through internal accruals.

Seamless pipes are part of OCTG universe & the consumption of OCTG is driven by the oil & gas exploration and drilling activities both in India and globally. The activities are expected to surge at further heights in view of increased prices of oil and also increasing demand for energy requirements. This would enable the group to capture the maximum demand potential going forward and would lead to substantial growth in the businesses of MSL.

DP Jindal group is one of the leading and prominent business houses in India in its line of business having a group turnover of INR 3000 crores. It is well diversified into manufacturing of seamless pipes, ERW pipes, wind power generation, offshore oil & gas drilling and projects exports. It is also having a JV with Tenaris and also having a marketing collaboration with Noble Drilling of US for Indian operations.

Foundation stone laid for alloy steel project in AP

It is reported that Dr YS Rajasekhara Reddy chief minister of Andhra Pradesh will lay a foundation stone of Special Bar Quality Steels Limited at Ankul Patur of Chillakur mandal in Nellore district. The INR 1,100 crore integrated steel project, to be spread over more than 500 acres of land with production capacity of 500,000 tonnes per annum will be India’s biggest ever integrated alloy steel project.

Dr Reddy said that the project, which will manufacture alloy and special steel required for the automotive and engineering sectors, might offer employment avenues to more than 3,00 persons.

The promotors, Chennai based RKKR Steels Limited, initially wanted to set up the integrated alloy steel project in 3 phases at an investment of INR 500 crore and an annual production capacity of 250,000 tonnes at Kolanakoduru of Manubolu mandal. In addition, it has also decided to set up 60 MW coal based thermal power project by importing coal from Australia via Krishnapatnam port project in a bid to generate required power supply for the project.

Uttam Galva cuts steel prices by INR 3000 per tonne

Uttam Galva Steels announced that it has slashed prices of its galvanized corrugated steel products by INR 3,000 per tonne to INR 46,000 per tonne including of all taxes.

It said that the cut in price has been made due to the reduced zinc cost.

Orissa gives administrative sanction to Mittal for land buy

SNS reported that Orissa government has given administrative sanction for acquiring land at Patana tehsil in Keonjhar district for ArcelorMittal's proposed 12 million tonnes per annum steel plant.

Mr Padmanabha Behera steel & mines minister of Orissa said that the state government has also appointed a nodal officer to oversee land acquisition process and other issues concerning ArcelorMittal’s Greenfield project.

ArcelorMittal, which announced the INR 40,000 crore project in 2006, has already deposited INR 4.03 crore with the Industrial Development Corporation as processing fee for phase I land acquisition. It has sought nearly 8,000 acres of land for the purpose and the state is believed to have agreed to the request.

Orissa government has, however, cleared acquisition of only 1,224 acre of land spread over 3 villages like Angikala, Baradangua and Bhrungaraj under Patana tehsil in the first phase of land acquisition. The 1,224 acres demarcated for the 1st phase acquisition comprised 431 acres of government land and 739 acres belonging to private owners.

While the state government had fixed price per acre of state land at INR 200,000, it was yet to decide cost of private land which would be fixed according to rehabilitation and resettlement policy.

CIL intensifies efforts for coal properties in Canada

It is reported that Coal India Limited has intensified its efforts to acquire coal properties in Canada and an agreement in this regard will soon be signed with British Columbia.

An official of union coal ministry said that "The issue of CIL's operations in British Columbia was discussed at length by the visiting Premier of British Columbia Mr Gordon Campbell during his meeting with Mr Dasari Narayana Rao union minister of state for coal."

Mr Campbell said that Canada government is willing to extend all cooperation to enable CIL get a foothold in coal resource rich province. He assured Mr Rao of all cooperation and invited him to visit the Canadian province at the earliest during when the MoU can be signed.

Mr Rao suggested on signing a MoU to identify the areas of cooperation for further expeditious action. He said that CIL's operations in Canada will mutually benefit both as India has limited coking coal reserves and plenty are available in British Columbia.

The official said that CIL has already done some spadework when an official delegation visited British Columbia early in 2007 and held discussions with the ministries of energy, mines and petroleum resources & economic development of the provincial government besides holding talks with various Canadian companies. He added that some Canadian companies, like Cline Mining Corporation and Colonial Coal Corporation have offered alliance and JV opportunities for exploration and coal mining.

Police denies human rights violation at POSCO site

BS reported that Orissa’s Jagatsinghpur district administration has denied human rights violation in the POSCO project site area near Paradip following deployment of police force to maintain law and order following clashes between the supporters and opponents of the project there last week.

Mr Pramod Kumar Mehereda DC of Jagatsinghpur district said that “Police has been deployed at POSCO site to bring normalcy in proposed project affected villages and there is no question of breach of human rights in Dhinikia.” He added that anti POSCO activists have been assaulted, tortured, ostracized, looted local people and other officials since 2 years.

He informed that he visited Nuagaon, Noliashai, Gadakujang and other villages of POSCO site areas so they have expressed their positive response to bring peace in POSCO areas. He added that villagers have formed a committee with all party members and demanded deployment of police for peace in the area. Similarly, they have also demanded establishment of POSCO steel project by taking consent of the people of the affected villages.

Mr RK Sharama district superintendent of police said that Maoists elements have links with the anti POSCO agitators in Jagatsinghpur and intelligence officials have been pressed in to service to unearth their base.

11 coal blocks allocated to PSUs for setting up of power projects

Mr Dasari Narayana Rao union minister of state for coal said that 11 coal blocks with reserves of about 2238.18 million tonnes have been allocated since October 2006 for setting up of new power projects in the private sector.

As per the conditions of allocation, development of a power plant has to be synchronous with development of the linked coal block. Coal production from the captive block shall commence within 36 months or 42 months in case the area falls in forest land in case of open cast mine and in 48 months or 54 months in case the area falls under forest land in case of UG mine, from the date of allocation. If the captive coal block is not explored, additional 2 years are allowed for detailed exploration and preparation of geological report.

Gap between coal demand and supply to be widened in 11th Plan

Mr Dasari Narayana Rao union minister of state for coal said that the gap between the demand and supply of coal in the terminal year 2011-12 of the 11th Plan is projected to be 51.10 million tonnes as against the actual gap of 33.64 million tonnes in the terminal year 2006-07 of the 10th Plan.

During the period 2006-07 the actual production of coal was 430.86 million tonnes as against the projected demand of 474.18 million tonnes and actual coal off take of 464.5 million tonnes.

As per the estimates of Geological Survey of India as on April 1st 2007, the geological coal resources of India stand at 257.38 billion tonnes of which 99 billion tonnes of reserves fall in proved category.

SAT stays Essar Steel's delisting plans

It is reported that the Securities Appellate Tribunal has stayed the delisting of Essar Steel shares from the stock exchanges. Essar’s stock was supposed to be de listed on December 14th 2007 after it said that the open offer had successfully resulted in a discovered price of INR 48 per share.

In September 2007, the promoters of Essar Steel had made an open offer to acquire 14.72 crore shares or 13% of the equity at INR 48 per share. While the book building offer closed on October 3rd 2007, there was no intimation on the public response to the offer.

Acting on a petition filed by some investors, SAT stopped the delisting and said that Essar Steel will remain listed.

Declining to comment on the content of the SAT order, Essar Steel spokesperson said that “It has completed the delisting formalities pursuant to the SEBI Guidelines 2003 in an open and transparent manner. Essar Steel and the promoters have complied with all the requisite laws and regulations on delisting of the stock. Accordingly, BSE and NSE have accorded their approval for delisting of shares.”

Bombay Stock Exchange informed its members that the trading in the equity shares of Essar Steel will not be suspended and de listed. According to BSE, the promoters held 87.08% stake as on September 30th 2007, while the public held 6.7% in Essar Steel.

India’s new fertilizer policy may launch by January 2008

It is reported that the draft for the new fertilizer policy is ready and is likely to be sent for the union cabinet approval by January 2008. The new policy will aim to attract investment in the sector and reduce dependence on imports. It will be benchmarked to international standards, will encourage healthy competition and efficiency both in production and distribution.

It is learnt that, union government is working out the modalities for encouraging fortified fertilisers to add vital micro nutrients to the soil and also considering the inclusion of sulphur as a subsidized nutrient in the subsidy regime since there is sulphur deficiency in many regions. It is also looking into a uniform freight policy for all subsidized fertilisers in India on the pattern of the present freight regime for urea.

KEC International bags USD 40 million transmission contract in Namibia

KEC International has announced that it has won USD 40 million contract to build electricity transmission lines for Namibia’s power hungry consumers. According to the deal, it will construct transmission lines for NamPower’s Caprivi Link Interconnector, a power project meant to avert the current energy shortfalls Namibia is experiencing.

The project, which was clinched through an international competitive bidding process, is anticipated to last 22 months.

The Caprivi Link Interconnector is a 970 kilometer long 350 kV high voltage direct current bipolar line, which runs from Zambezi substation near Katima Mulilo in the eastern parts of the country to Gerus substation, situated between Otjiwarongo and Outjo in central Namibia. It will interconnect the electricity networks of Namibia, Zambia, Zimbabwe, the DR Congo and South Africa to create an alternative route for power imports and exports to and from neighboring countries.

Namibia, a net electricity importer, has been experiencing energy problems, as its major supplier, South Africa, is running out of surplus power to export. The country only generates 375 MW but demand has been rising due to increasing investment, particularly in the booming mining sector.

Railway ministry considering funds for freight corridors

Exim News Service reported that the proposal of union ministry of railways for the dedicated, multimodal, high axle load freight corridors on the Delhi Mumbai and Delhi Howrah routes has been forwarded to the government of Japan.

However, a final decision regarding the sources of funding for this project, including Japanese assistance, is under the consideration of union ministry of railways.

Aegis Autogas plans 300 new gas stations across India

BS reported that Mumbai based Aegis Logistics is planning to set up 300 auto LPG gas stations across India in the next 2 to 3 years, with majority of them coming up in Maharashtra, Gujarat, Karnataka and Madhya Pradesh.

Aegis Logistics, which currently handles 250,000 tonnes of LPG and propane annually at its gas terminal in Mumbai, expects to touch annual sales of 3,000 tonnes from these stations. It launched its LPG stations in Chinchwad and Alandi in Pune district, taking its total network of stations to 24 in Maharashtra, Gujarat and Karnataka.

Mr SK Hazra MD of Aegis Logistics said that “Autogas consumption in India is increasing at a rapid pace with car manufacturers like Maruti and Hyundai rolling out LPG retrofit models. There are around 500,000 vehicles running on domestic LPG cylinders, while around 1 million vehicles use LPG as fuel. We expect auto LPG consumption in India to touch 2.25 million tonnes a year.”

It recently commissioned auto LPG stations in Davangere and Updupi in Karnataka and at Panvel in Navi Mumbai and new outlets would soon come up in Valsad, Bavla, Dharampur and Patan in Gujarat, Fatehnagar and Rajsamand in Rajasthan and Shimoga and Mysore in Karnataka.

NaftoGaz bags contract from ONGC for Mumbai High offshore fields

It is reported that Ukraine’s NaftoGaz has bagged EUR 129.69 million contract from Oil & Natural Gas Corporation for inter connecting power facilities in its Mumbai High offshore fields.

ONGC's 12 platform in Mumbai High fields have separate power stations and NaftoGaz will be inter connecting them through offshore cabling to enable utilizing excess power in some at platforms that have either no or inadequate power.

The scope of the project entails survey, design, engineering, procurement, fabrication, installation, modification of existing platforms, laying of submarine cables, hook up, testing and commissioning. It also includes laying about 100 kilometer of submarine cable with necessary top side deck modification and installation of switch gears.

The first phase of the project is to be completed by April 2009 and the second phase by March 2010.

IOC’s Paradip Haldia pipeline may start operational by January

ProjectsToday reported that Indian Oil Corporation's Paradip Haldia crude pipeline is expected to become operational and begin to transport crude to Haldia and Barauni refineries by January 2008.

Though the proposed 330 kilometer long pipeline was ready in early 2007, work on single point mooring facility at Paradip was stalled owing to issues ranging from technical problems to replacement of the contractor. The pipeline project was also delayed due to the time consuming process of securing environmental clearances for passing through the forests of Orissa, the estuaries of a number of rivers, including the Mahanadi on the coasts, posed technological challenges.

ArcelorMittal signs a Business Cooperation Agreement with China Oriental Group

ArcelorMittal announced that it has entered into a Business Cooperation Agreement with China Oriental Group Company Limited and its subsidiaries. In addition, ArcelorMittal entered into a Shareholders' Agreement with the controlling shareholders of China Oriental regarding their shareholdings in and the management of the Company. The agreements will allow ArcelorMittal strengthen its position in China's fast growing steel market.

The Business Cooperation Agreement will see ArcelorMittal share technology, technical expertise and know how with the aim of transforming the Group into a leading producer of heavy sections in China. ArcelorMittal will also assist the Group in sourcing of iron ore and coal.

Mr LN Mittal president & CEO of ArcelorMittal said that "We have made no secret of our wish to participate more actively in the China's fast growing steel market and the agreements we have signed are a major step forward in delivering that strategy. Not only will this strengthen our position in China. It will also provide the China Oriental Group with the expertise and experience it needs to become a leading producer of heavy sections in China."

He added that "Part of ArcelorMittal's growth over the years has been through strategic acquisitions and subsequently creating value through active management of the companies acquired. I am confident that these agreements will be further examples of how ArcelorMittal adds value through the provision of technology and technical know how, training, financial management, mergers and acquisitions, supply chain management and marketing as well as sustainable and resource efficient production."

Mr Han Jingyuan chairman & CEO of China Oriental said that "ArcelorMittal becoming the Company's second largest shareholder and the signing of the Business Cooperation Agreement well reflect its confidence in the potential of China Oriental's operations, as well as in the market in Mainland China . We are delighted to have the world's leading steel company as our strategic partner. I believe with ArcelorMittal's support in steel production technology, its network of worldwide raw material sourcing and financial management expertise, China Oriental can expedite its development and the realization of its plan to become a world-class leading H-section steel production base in the PRC.”

ArcelorMittal intends to make a general offer for the Company in line with HK Stock Exchange regulation. The offer price will be no less than HKD 6.12 per Share, being the price at which a 28.02% stake in China Oriental was purchased by ArcelorMittal from Ms Chen Ningning. In addition, it is the intention of ArcelorMittal to maintain the listing of China Oriental after the close of the general offer.

ArcelorMittal to acquire Slovak ferro-alloys manufacturer OFZ

ArcelorMittal announced that it has signed an agreement to acquire the assets of OFZ, as one of the leading Central European manufacturers of ferro alloys.

OFZ is involved in the manufacture of a wide range of ferro alloys on the basis of manganese and silicon, namely ferromanganese, ferromanganese silicon and ferro silicon. Other activities include the production of cored wires.

The plant, located in the north of Slovakia, is in close proximity to ArcelorMittal's eastern European mills, including Ostrava and Poland to whom it has historically been a supplier. With an annual operating capacity of 150,000 tonnes, through the use of six furnaces, OFZ produced 141,000 tonnes of ferro alloys in 2006.

Mr Aditya Mittal CFO and member of the Group Management Board of ArcelorMittal, said that "This acquisition further strengthens our ferro alloy supply portfolio, following our recent announcement that we had entered into a strategic equity partnership to develop the Kalagadi Manganese's manganese resources in South Africa. As the largest consumer of manganese alloys in Europe, we are excited by this opportunity and we look forward to integrating the OFZ operations into the ArcelorMittal group.”

US steel import permit in November decrease by 14% MoM

Based on the Commerce Department’s most recent Steel Import Monitoring and Analysis data, the American Iron and Steel Institute reported today that steel import permit applications for the month of November 2007 totaled 2,287,000 net tons. This was a 14% decrease from the 2,665,000 permit tons recorded in October 2007, a 15% decrease from the October preliminary imports total of 2,700,000 net tons and 145 lower than the 2005 monthly average.

Import permit tonnage for finished steel in November 2007 was 1,914,000 net tons, equal to the preliminary imports of 1,913,000 net tons in October. YTD finished steel imports remain 8% higher than the same period in 2005.

For November 2007, the largest volumes of steel import permit applications for countries outside of North America were China 316,000 net tons, Korea at 152,000 net tons and Japan at 102,000 net tons.

Finished steel import permit applications for Chinese steel 316,000 net tons were up 4% in November compared to the preliminary imports total for October. This tonnage for China, while still below the 2006 record tonnage amounts that occurred in the second half of last year, was 65% higher than the 2005 monthly average of 192,000 net tons for China.


Mr Andrew G Sharkey III president & CEO of AISI said that “Notwithstanding the monthly decline, the yearly totals remain at elevated levels, and concerns about China and trade-distorting practices are not going away, especially in certain individual product categories from certain countries.”

MEPS forecast global steel output to reach 1.6 billion tonnes by 2011

MEPS forecast that the global crude steel output in 2007 at 1350 million tonnes. MEPS added that “Further growth is anticipated rising to 1600 million tonnes in 2011. This represents an increase of more than 350 million tonnes over the period from 2006. In the previous five years, the volume of production expanded by almost 400 million tonnes.”

MEPS said that “Most of the increase in iron and steel production over the next five years will take place in the developing/emerging nations of Asia. We estimate that around 71% of global growth in steelmaking to 2011 will occur in these countries. In contrast, we predict that steel producers in the industrialized world will contribute less than 7% of the higher output over the period.”

Crude steel production forecast

(In millions tonnes)
Source: MEPS - Global Iron & Steel Production to 2011

MEPS further added that “Of the 350 million tonne increase between 2006 and 2011. China is forecast to supply almost 210 million tonnes. Other significant contributors will be the former USSR with 33 million tonnes, Asia excluding China and Japan is likely to lift output by more than 30 million tonnes. Africa/Middle East are expected to supply 15 million tonnes each. These may appear to be modest tonnages but in percentage terms they are quite significant.”

MEPS said that “Rapidly rising commodity prices (particularly oil, coal and industrial metals including iron ore) have changed the economic climate in recent years. Oil revenues have led to significant building activity in the Middle East. Reserves of energy and steelmaking raw materials in the former USSR have improved economic activity in that region. A similar picture has been recorded in India and Brazil. The availability of competitively priced energy and steelmaking raw materials will be a major factor in the location of steel manufacturing in the coming years.”

MEPS added that “In the longer term, when blastfurnaces and converters in the industrialized nations reach the end of their useful life, a number of them will not be rebuilt. Supplies of semi finished products are likely to be made at parent companies or subsidiaries in the low cost manufacturing countries of the world.”

Gerdau to invest USD400 million in heavy plate roller

BNamericas reported that Brazilian steelmaker Gerdau plans to invest more than USD 400 million to install an 870,000 tonne per yaer heavy plate rolling plant at one of its operations in Brazil, with startup targeted for 2010.

The report added that a feasibility studies into where to install the plant are near conclusion, it added that the plates will be sold in Brazil and abroad.

Porto Alegre based Gerdau has assets in Brazil, Peru, Chile, Colombia, Argentina, the Dominican Republic, Mexico, Peru, Spain, Uruguay, Paraguay, the US and India.

Hyundai Steel and ThyssenKrupp team up for Steelworks

The Korean Times reported that Hyundai Steel teamed up with Germany's ThyssenKrupp Steel Thursday for technological backing to expedite the construction of its integrated steel mill complex. The arm of Hyundai Motor Group broke ground in the southwestern coastal city of Dangjin in late October to build the nation's third largest integrated steel mill, but it has been seeking a partnership with TKS since 2005 to facilitate technology transfers.

Under the agreement signed by Mr Chung Mong koo chairman of Hyundai Motor and Mr Karl Ulrich Kohler chairman of Thyssenkrupp, the European industrial conglomerate will pass on its coking, steel making and overall operational technology.

Hyundai Steel plans to complete the facility with an annual output capacity of seven million tonnes by 2011, with an additional upgrade expanding the capacity to 12 million tonnes by 2015.

The five trillion won steelworks project has been Chung's goal, as the facility would secure a steady supply of steel for the nation's two largest automakers, Hyundai Motor and Kia Motors.

A Hyundai Steel spokesman said that “ThyssenKrupp has extensive knowledge in operating a blast furnace, which will play a significant role in stabilizing Hyundai Steel's preliminary steps in the mega project.”

Mr Chung also promised even further partnerships in the future during the signing ceremony, said that “We hope the two companies can actively exchange knowledge in more areas, including thermo mechanically processed steel.''

The TKS chief welcomed the offer and said the company will seek ways to collaborate in the auto business.

ThyssenKrupp which produced about 17 million tonnes of steel last year is well known for its premium quality auto steel sheets used by Volkswagen, DaimlerChrysler, Mercedes Benz and BMW.

Fire at ThyssenKrupp steel plant kills one and injures seven

Reuters reported that a fire at a steel factory in the Italian city of Turin killed one worker and injured seven early on Thursday.

Police said that the dead and injured were night shift workers at the ThyssenKrupp plant. The fire broke out at about 1:10 AM. It added that six of the injured suffered serious burns.

German November crude steel output up 2.4% YoY

According to Germany’s Federal Statistics Office, crude steel production in Germany rose by 2.4% YoY in November to 4.02 million tonnes, while pig iron output soared by 7.7% to 2.54 million tonnes.

On a month on month basis, crude steel production was down 4.2% while pig iron production dropped by 3.7%. it added that adjusted for seasonal and calendar effects, crude steel production increased by 1.8% in November from October.

US Steel to hire 250

US Steel Corp will be looking to fill an expected 250 job openings at its Northwest Indiana facilities by the close of 2009. The report quoted Mr Todd Rollings staff supervisor of US Steel's Technical Training said that the openings are due to projected retirements in the mechanical and electrical maintenance divisions. Mr Rollings added that "The nature of the jobs in most of industry across the country has changed significantly over the past three decades. In the past we had a series of shops departments, each specializing in a particular craft. In the 1970s and 1980s we moved into a much more highly trained and educated work force. Today's applicants will be expected to perform at a much higher capacity than in the past.”

Mr Karen Orosz who serves as the manager of Workforce and Economic Development at Ivy Tech in Gary said that it's incumbent upon the college to provide customized training and educational programs to meet the needs of local manufacturers and corporations such as US Steel, in order to guarantee economic development in Northwest Indiana.

To that end, Ms Orosz said the college and US Steel are continuing their partnership, which makes the Industrial Maintenance and Industrial Electrician programs available at the Gary campus. Each of the programs provides for a one year certificate that can lead successful participants into a two year associate's degree. She added that "These are by all means careers in steel.”

Mr Rollings said those who successfully complete the one year certificate program and are hired by US Steel could have the three year training program reduced to two years, which means a higher wage in a shorter period of time. He added that the jobs in these fields are expected to pay between USD 16.50 and USD 21.03 per hour with full insurance benefits.

Sumitomo Metals to Expand Automobile Flat Steel Sales

JMB reported that Sumitomo Metal Industries expands the for automobile rate to 60% of in steel sheet sales for fiscal 2008 starting April 2008 from 57% in fiscal 2007 and 53% in fiscal 2006.

Sumitomo Metal also tries to increase the high valued steel sales with the high valued products line and technology to follow growing automobile output at home and abroad.

Xstrata Copper confirms world class mineral resource at the Tampakan Project

Xstrata Copper announced that the Mineral Resource estimate for the world class Tampakan copper gold project in the Philippines has been increased by over 10% in both tonnes and contained copper, consolidating Tampakan's position as one of the largest undeveloped copper deposits in South East Asia.

The upgraded Measured, Indicated and Inferred Resource totals 2.2 billion tonnes at a grade of 0.6% copper and 0.2 grams per tonne gold and contains 12.8 million tonnes of copper and 15.2 million ounces of gold using a 0.3% copper cut off grade. The Mineral Resource, which includes 24,700 metres of drilling conducted in 2007, also includes estimated average grades for molybdenum of 70 parts per million.

This is the first resource estimate published by Xstrata Copper since it assumed management control of Tampakan in March 2007 through its Philippines based affiliate Sagittarius Mines, Inc. The previous Mineral Resource estimate of 2 billion tonnes at 0.6% copper, using the same cut off grade, was published in April 2006.

Mr Peter Forrestal executive general manager project development of Xstrata Copper said that the Tampakan deposit represents the largest development project in Xstrata Copper’s portfolio. He added that "We continue to look for growth opportunities through improvements at existing operations, acquisitions and the development of our strong project pipeline. The promising mineral resource estimate at Tampakan indicates the project has excellent potential to make a substantial contribution to Xstrata Copper's growth profile.”

He further added that "We are committed to evaluating and developing the Tampakan project in genuine partnership with the Philippine government and authorities, local institutions and our neighbouring communities. As such, our current focus is on feasibility related studies, which we aim to complete in the second half of 2009 and on advancing our sustainable development programs with local communities.”

US Steel prices USD 500 million of senior unsecured notes

United States Steel Corporation announced that it has priced USD 500 million of 7.00% Senior Notes due 2018. The Senior Notes were priced at 99.087% of the principal amount. The proceeds of the offering will be used to repay the USD 400 million one year term loan incurred to finance a portion of the acquisition of Stelco Inc and the balance will be used for general corporate purposes.

United States Steel Corporation has filed a registration statement with the Securities and Exchange Commission for the offering to which this communication relates.

Banc of America Securities LLC, JP Morgan Securities Inc and Scotia Capital of USA Inc are joint book runners for this offering.

WCI Steel appoints Mr Anthony as president & CEO

WCI Steel, Inc announced the appointment of Mr Leonard M Anthony as the president, CEO and a member of the board of directors, effective immediately.

Mr Anthony is the former executive vice president & CFO of Dresser Rand Corp having led that company through a very successful IPO on August 5th 2005. Prior to that, he served as CFO of International Steel Group from 2003 until ISG was acquired by ArcelorMittal. He has more than 25 years of financial and operational management experience. He joined Bethlehem Steel Corp. in 1979 and advanced through increasingly responsible positions to become Chief Financial Officer in 2001 and served in that position until Bethlehem was acquired by ISG in 2003.

Mr Jack W Sights chairman of the board of directors of WCI Steel said that "Mr Len Anthony is an exceptional individual, capable of providing strong, experienced leadership as we confront the actions necessary to return WCI Steel to profitability. We expect that under Len's leadership, combined with an increased focus on customer service, quality and cost reduction, WCI Steel will enhance its position as a provider of custom steel to niche markets. We remain optimistic about the future of WCI's business with Len as our new president and chief executive officer."

Mr Len Anthony said that "Although we have considerable challenges ahead of us, I am confident that working together with our customers, suppliers and employees, we can successfully implement solutions to the problems facing WCI. We are committed to being faster and more aggressive in leading WCI Steel to a brighter future."

Taiwan's black tube demand still low this month

YIEH reported that Taiwan’s domestic black pipe mills have raised the prices of black pipe in December by TWD 500 per tonne reaching around TWD 22,500 per tonne.

According to the mills, the demand is still not strong enough after the price increase. Most of customers are holding off their purchasing this month.

A market participant said customers won’t take the risk to buy with the new price now. The negative sentiment may last before the Chinese New Year Holidays.

Korea Refractories signs contract with Hyundai Steel

Korea Refractories Co Ltd announced that it has signed a contract with Hyundai Steel Co Ltd. to construct shaft furnaces for coherence ironworks. The contract amount is worth KRW 79,843,500,000.

Czech NWR extends life of mines by 20 years

Czech news agency citing Mr Klaus Dieter Beck general director of OKD reported that New World Resources, owner of the largest Czech hard coal miner, expects its mines to operate another 20 years after investing EUR 300 million into new equipment allowing it to mine deeper.

Mr Beck said that “The planning horizon for our mines is currently 20 years, we stopped at this limit because we don't know how the price level of coal will be in 25 years.” He added that it would be necessary to invest some CZK 40 billion over the next 20 years to deepen the mines.

CTK reported that OKD last year extracted 13 million tonnes of coal from its mines, which have operated for an average 11.5 years.

Mr Bowler urges government to back BHP takeover bid for Rio

Mr John Bowler former Western Australian resources minister said that the State Government should support the BHP Billiton takeover bid for rival Rio Tinto.

Mr Bowler believes it is increasingly likely Rio will be taken over and BHP should be supported because of its strong connection to Western Australia. Mr Bowler said that BHP has a number of senior executives based in Western Australian.

He also believes Chinese fears that the merger would result in a company dominating the global iron ore market are unfounded. Mr Bowler said that "A merged BHP and Rio would still only control 38% of the world iron ore trade and would only be slightly larger than CVRD in Brazil, so claims that this new super company would dominate the world iron ore industry too much really are unfounded."

Nucor increases base dividend by 173%

North America's largest recycler, Nucor has increased the regular quarterly cash dividend on Nucor's common stock to thirty cents per share, from eleven cents per share. In addition to the thirty cents per share base dividend amount, Nucor's Board approved the payment of a supplemental dividend of thirty one cents per share, for a total dividend of sixty one cents per share. This cash dividend is payable on February 11th 2008 to stockholders of record on December 31st 2007, and is Nucor's one hundred thirty ninth consecutive quarterly cash dividend.

Nucor has increased its regular or base, cash dividend every year since it first began paying dividends in 1973. Nucor's board of directors stated that the 173% increase in the base quarterly cash dividend to thirty cents reflects the company's success in building Nucor's long term earnings power. This growth in Nucor's sustainable earnings power has been driven by the Nucor Team's disciplined execution of Nucor's strategic plan. And, the increased base dividend reflects Nucor's belief that the business cycle for steel will see both higher highs and higher lows going forward.

It added that the supplemental dividend of thirty one cents per share is based primarily on Nucor's continued strong results. The payment of supplemental dividends in any future period will depend upon many factors, including Nucor's earnings, cash flows and financial position.

Mr Porter receives Finnish Steel and Metal Producers’ award

It is reported that Mr David Porter product development manager of Rautaruukki’s Raahe Works in Finland is one of the recipients of this year’s Finnish Steel and Metal Producers’ awards. The award is made by the Association of Finnish Steel and Metal Producers.

The award was made because of Mr Porter’s extremely commendable work to identify new applications for metals. He and his development team have been involved in extensive cooperation work that has resulted in a doubling of the maximum strength of steels from the strip mill and a tripling of the maximum strength of steels from the plate mill at Ruukki’s hot rolling mill in just a few years.

Mr Porter said that “Steel has continuously held up and its use seems to be going from strength to strength. This is due not least to constant development work. The development of increasingly high strength, more formable grades of steel makes for ever lighter structures in the lifting, handling and transportation equipment and automotive industries without compromising on safety. In construction, new steels and the modern solutions based on them can considerably shorten construction times and thus deliver cost savings.”

“David Porter is known as a thorough, accurate researcher, whose quality you can always rely on and who recognises and respects the results of other people,” state the reasons for the award.

The Finnish Steel and Metal Producers’ award has been made eleven times since 1980. This year, six persons received the award.

Taiwan's HDG import declines in October

YIEH reported that Taiwan’s import quantity of hot dipped galvanized was 16,151 tons in October and the average price was at TWD 23,070 per tonne. The import reduced by 24% MoM.

A trader said that domestic hot dipped galvanized market has improved after it was calm for a long time. It added that a combination of tight supply and higher raw material costs is supporting the market.

Perilya looks to increase Broken Hill presence

ABC News reported that Perilya is set to expand its interests in Broken Hill in far western New South Wales, with major announcements possible for the Pinnacles area and the former North Mine.

The board of directors has toured the company's Broken Hill facilities this week and the Mr Len Jubber CEO of Perilya says this will help the company's forward planning for development and exploration.

Mr Jubber said that an announcement about the North Mine Deeps project is expected within weeks. He added that "We are looking at a couple of opportunities, we're looking at an opportunity to extend the decline and we're also looking at an opportunity to extend the shaft.”

Mr Jubber said that "They are not mutually exclusive and my gut feeling is that it's probably a combination of the two which would give you the best solution."

Erdemir LF furnace by Sino Steel starts commercial operation

It is reported that after 10 month long hard work by engineers and workers in Equipment Co of Sino Steel, the 120 tonnes LF furnace in Erdemir in Turkey successfully produced the first furnace of molten steel on August 22nd 2007 and started commercial operation on November 14th 2007.

This is the first LF project constructed by Sino Steel abroad. The design capacity of the LF furnace is 1.7 million tonnes per annum and it utilizes the most advanced smelting technology.

Equipment Co of Sino Steel is took charge of the basic design, the supply to the main equipment and the installation and debugging as well. The success of the commercial operation of LF furnace in Erdemir is good for Sino Steel to further develop international smelting furnace market.

RAKIA to invest USD 2 billion for aluminium smelter in India

UAE’s leading provincial investment company Ras Al Khaimah Investment Authority has announced that it would invest USD 2 billion to set up an aluminium smelter in Andhra Pradesh. The plant is expected to come up in the next 2 and half years.

Mr Khattar Massad CEO of RAKIA CEO said that "We are looking at building 1.5 million tonnes per annum capacity plant for extracting alumina and 350,000 tonnes facility for aluminium. The investment would be funded through internal accruals and debt. There are presently no partners in the project, but we might look at partnering someone in the near future."

RAKIA would require land of 1,100 acres of land the project and the Andhra Pradesh Industrial Development Authority was already in the process of buying land.

Kuwait Petro in talks with RIL for oil and gas ventures

It is reported that Kuwait Petroleum and India’s Reliance Industries Limited have kicked off the first round of discussions for scripting a mega joint collaboration across the oil and gas vertical. KPC is keen to rope in RIL as a partner in its upcoming projects in Kuwait in both refining and petrochemicals.

Sources said that KPC has concluded an agreement with Dow Chemicals by which it plans to jointly take up projects in Kuwait and third countries. Kuwait, which commands about 10% of the world’s oil reserves, is building its downstream capacities including refineries and petrochemical plants to capitalize on its oil assets.

The source added that “Kuwait Petroleum is particularly impressed with the on going projects of RIL, particularly in the refinery sector. It would be keen to look at some sort of cooperation and presence in the new refinery being planned by Reliance. Kuwait Petroleum will look at this cooperation in conjunction with Dow Chemicals which has an extensive exposure in Kuwait.”

Pakistan hopes economy growth to be stay at 7%

Mr Shamshad Akhtar chief of State Bank of Pakistan said that Pakistan's economy should grow at least 7% in the year to June 2008 despite the political turmoil. He added that "Pakistan now for some years has demonstrated a fairly robust economic growth backed by pretty deep structural reforms. We have found that in 2007, despite political noise, economic growth remains on track."

Mr Akhtar said that turmoil linked to the future of Mr Pervez Musharraf and uncertainty surrounding elections due on January 8th 2008 have slowed the inflow of portfolio investment into Pakistan. Inflation is running well above target, while the current account deficit is high and some economists have questioned the realism of Pakistan's 7.2% economic growth target for 2008. He added that "All the preliminary indications are that it would be. There has been a setback to the cotton crop this year, but we're hoping that it will be relatively limited. So 7% at least should be manageable, but we need more data to comment further."

He further added that "We are hoping that should suffice but it all depends on the situation in January 2008 when data comes in. But at this point we think that the current monetary stance is adequate to take us forward. Core inflation has been curbed quite effectively. It's really food prices, and as we know they are being driven by global supply and demand issues. Like every country we have food prices growing a bit stronger and this is a complication for the inflation rate. But there's very little monetary policy can do in the short term on food prices."

Saudi Aramco awards service contract to WorleyParsons

Saudi Aramco has awarded contracts worth USD 80 million for services to WorleyParsons for project management, front end engineering design development, contract bid package development, detailed design support, detailed design package preparation and construction management services for the Saudi Aramco East Coast Refinery Project at Ras Tanura to partially meet the demand.

Major scope items include several grassroots units like 400 million barrels oil per day crude distillation unit, 210 million barrels oil per day vacuum distillation unit, 120 million barrels oil per day visbreaker crude unit, 50 million barrels oil per day continuous catalyst regenerator, 20 million barrels oil per day isomerisation unit, 90 million barrels oil per day diesel hydrotreater, 30 million standard cubic feet per day hydrogen plant, 185 tonnes per day sulfur recovery unit, 820 GPM amine regeneration unit, 225 GPM sour water stripper, and related utilities, controls, interconnections with existing facilities, flares and tankage.

Mr John Grill CEO of WorleyParsons said that "WorleyParsons is very pleased to be part of this important undertaking by Saudi Aramco. Our company has participated in major hydrocarbons projects in Saudi Arabia since 1956. We will capitalize on our long history of achievement and tap our worldwide resources to deliver a project that represents all that is best in global execution."

The project will begin on contract signing during the first week of December 2007 and is scheduled for completion in the first quarter of 2012. Saudi Aramco estimates the total cost of facilities will be USD 8 billion.

WorleyParsons International will furnish out of Kingdom services at its offices in Arcadia, California and Beijing. Worley Arabia will furnish in Kingdom services at its offices in Al Khobar and at the Ras Tanura site in Saudi Arabia.

OPEC keeps oil output unchanged

Reuters reported that OPEC has decided to keep output unchanged at a ministerial summit in Abu Dhabi. OPEC members have agreed that there was enough oil in the market to meet winter fuel demand after the organization increased its output by 500,000 barrels per day in September 2007.

Reuters quoted Mr Gholam Hossein Nozari oil minister of Iran as saying that "Our position is that demand and supply are balanced and there is no need to increase oil to the market."

OPEC's official production quota will remain at 29.67 million barrels of oil per day, excluding Iraq. OPEC also approved Ecuador's bid to rejoin the organization after about 14 years and set its output target at 520,000 barrels per day. Angola, which joined OPEC in January 2007, was handed a quota of 1.9 million barrels of oil per day.

Iran ready to boost industrial ties with Muslim nations - Report

Mehr News Agency quoted Mr Ali AKbar Mehrabian industries & mines minister of Iran as saying that Iran is ready to expand its relations with Muslim nations in Asia, Africa and Latin America in the industrial and mineral sectors.

Mr Mehrabian added that Iran is capable to get involved in the projects of exploration, extraction, production and exploitation. Referring to Iran’s preparedness to cooperate with the nations in fields of oil and gas projects, he announced that Iran has appropriate relations with D8 member states especially with Indonesia and Turkey.

Livewel Aviation signs MRO facility pact for Dubai Airport

It is reported that Mumbai based Livewel Aviation Services has signed an agreement with the Jebel Ali Airport at Dubai for setting up a maintenance, repair and overhaul facility at the Dubai World Aviation City.

The proposed facility, to spread over 24,000 square meters, will entail an investment of USD 80 million. The maintenance, repair and overhaul will primarily focus on cabin interior refurbishment, aircraft painting, C-check and line maintenance.

Greece and Turkey open USD 400 million pipeline

Arabian Business reported that Mr Costas Karamanlis Prime Minister of Greek and his Turkish counterpart Mr Recep Tayip Erdogan met recently to open the USD 440 million gas pipeline to the Caspian region.

Mr Karamanlis said that "We made the first big step for the construction of the North East ring, which will transfer natural gas from the Caspian countries and the Middle East through Turkey, Greece and Italy to central Europe."

The 300 kilometer long pipeline, set to ease Russia's hold on Europe's energy supplies, will provide the EU with its first supply of gas from the Caspian region, bypassing Russia and the Middle East. It will link the Greek and Turkish networks and eventually carry gas from Azerbaijan to Italy.

When the 800 kilometer overland and undersea link to Italy set for completion by 2012, it will reach an annual capacity of 11.6 billion cubic meters and 70 % of it will be designated for the Italian market.

Pak Arab Refinery Limited raises LPG rates by over 14%

It is reported that Pak Arab Refinery Limited has revised upward LPG prices by more than 14% with immediate effect. It was the first producer to opt for increasing prices of LPG after Pakistan government allowed the complete deregulation of liquefied petroleum gas prices.

According to a circular of Parco, it has increased ex refinery price of LPG from PKR 39,809 to PKR 45,534 per tonne or PKR 5,725 per tonne. With the addition of 15% general sales, the LPG sale price has increased from PKR 45,878 per tonne to PKR 52,462 per tonne up by PKR 6,584 per tonne.

According to LPG distributors Association of Pakistan, the price of a domestic cylinder has been increased by PKR 78 and commercial cylinder by PKR 312 s a result. In other words, the sale price has increased by PKR 6.61 per kilogram.

Under a last week decision of the caretaker economic coordination committee of the cabinet, Pakistan’s ministry of petroleum and natural resources stopped the Oil and Gas Regulatory Authority from determining producer prices on December 3rd 2007. A notification issued by the directorate general of gas of petroleum ministry to the OGRA chairman said that "LPG producer price may not be notified by OGRA. Accordingly, the LPG producers may be allowed to fix their prices at their own on monthly basis."

Mr Irfan Khokhar chairman of LPG Distributors Association Pakistan has condemned Parco's decision. He said that Parco decision was unjust and a cruel joke against the people. He said if the producer price was not reduced immediately to PKR 25,000 per tonne, the distributors would disrupt LPG supplies across Pakistan because the consumers had started to give up LPG consumption and its sale had already declined by 30%.

Mr Fasih Ahmed spokesman for the LPG Producers Association said that the price increase announced by Parco was wrong decision at the wrong time. He added that "The 15% increase notified by Parco is unjustified and will unnecessarily burden the LPG consumer at a time when LPG prices are already at an all time high."

He said that the producers association believed the government's decision to deregulate the LPG sector was a positive step which should lead to lower end consumer prices. He added that "We also believe that all stakeholders in the LPG sector, including producers and marketing companies, must conduct themselves professionally and responsibly."

RSGT inks with Al Rajhi Bank for developing Jeddah Islamic Port

Arab News reported that Saudi Arabia’s Red Sea Gateway Terminal Company Limited and Al Rajhi Bank have signed Islamic financing agreements worth SAR 1.7 billion for the development of the third container terminal project of the Jeddah Islamic Port.

The SAR 1.7 billion Islamic financing facilities has been fully underwritten by Al Rajhi Bank, which includes SAR 1.275 billion Ijara facility to cover most of the equipment and construction related costs to be incurred during the three-year construction period. Al Rajhi Bank would provide SAR 900 million and Saudi Fransi Bank would provide SAR 375 million in the Ijara facility for RSGT. The remaining SAR 425 million Islamic facilities being provided by Al Rajhi Bank for RSGT would include a standby facility.
Al Rajhi Bank and The Standard Bank of South Africa have jointly provided the financial advice for RSGT which is implementing the development on a build operate transfer basis.

Mr Alireza chairman of RSGT said that “The Al Rajhi Bank Standard Bank consortium was chosen as the financial advisor due to their wealth of experience in providing project finance advisory, their strong multi disciplinary advisory team and their extensive experience in comparable projects worldwide.”

The container terminal to be built at an estimated cost of about SAR 1,900 million will be funded in a debt to equity ratio of 69:31. The equity for RSGT would be provided by the project’s founding shareholders, including SISCO, Xenel Industries, Tusdeer and City Island Holdings Limited.

Red Sea Gateway Terminal has engaged China Harbor Engineering Company Limited for civil construction and Shanghai Zhenhua Port Machinery Co Limited of China for supply of cranes and other equipment. The terminal, with a 740 meter long main berth, a 390 meter long feeder berth and a draft of 18 meter, will have an annual container handling capacity of 1.5 million TEUs. It will also have its own dedicated 16.5 meter deep channel linking the Jeddah Islamic Port’s main channel.

The terminal, design carried by Halcrow International of UK, will accommodate to serve the next generation of container ships. The two berths are planned to be ready for operations during the fourth quarter of 2009.

Injaz Projects to close Petkim acquisition in January 2008

Saudi based Injaz Projects has announced that its JV proposal of USD 2 billion to acquire a 51% stake in Turkey’s Petkim Petrokemiya is on schedule to close in late January 2008.

According to an Injaz Projects spokesperson, Injaz Projects, together with its partners, Azerbaijan Oil and Gas Company and Turcas Petroleum, formed a JV group in early 2007 for the purpose of winning the Petkim tender, but also to create a regional force in the petrochemical sector.

Mr Ameen Killidar CEO of Injaz Projects said that “We are optimistic that the Socar Turcas Injaz JV group will close the Petkim acquisition by late January 2008. Injaz Projects believes that Turkey’s petrochemical sector could be worth as much as USD 12 billion annually by 2015, so we are keen to get into the market now and begin immediately to contribute to Petkim’s development.”

Petkim fulfills 25% of the local demand and produces thermoplastics, textile intermediary products, synthetic rubber raw materials, and other petrochemicals. It has an annual production capacity of 1.78 million tonnes.

Injaz Projects delivers strategic, financial and project management services for individual and consortia backed projects, from telecom licensing agreements to the construction of entire cities.

Iran sees trade ties with Pakistan to grow further

United Press of Pakistan quoted Mr Ahmed Fasihi Iranian Consulate General at Karachi as saying that the trade volume between Iran and Pakistan are expanding following the preferential trade agreement signed by 2 countries.

Mr Fasihi said that following the agreement between Iran and Pakistan the trade volume and value had increased. He added that his office had received 1800 calls from Pakistani businessmen, traders and industrialists showing keen interest to promote and expand trade and bilateral exchanges between the Islamic Republic of Iran and Pakistan.

He said that as per plan chalked out many more Pakistani trade groups would be visiting Iran while more delegations of businessmen, traders and industrialists would be visiting Pakistan from Islamic Republic of Iran to realise the full potential of the trade and economic exchanges between the two countries.

Mr Fasihi also pointed out that Iran provided equal opportunities for middle level enterprises to establish businesses and joint projects in the preferential trade zones of Iran on lines similar to those in the UAE. In fact Iran offered very competitive environment and incentives for establishment of joint ventures by Pakistan with Iranian partners.

Major real estate cos discussing Istanbul's real estate issues

Turkish Daily News reported that representatives from 36 leading companies in the real estate market have participated in ‘Hürriyet Real Estate Summit’ to discuss the future of the sector and precautions to be taken.

Mr Nazmi Durbakayım of Turkish real estate developer Teknik Yapı said that “In 2005 there was a fury in the real estate sector regarding projects, but a healthy development would only be possible once the effects of this fury cease.”

Mr Mesut Aslan of Emlakchi also sad that many people looking to purchase homes await a fall in prices as a result of that, USD 96 billion is sitting in bank deposit accounts. He added that, in order to do that, making people realize that real estate prices will not decrease is a must.

Mr Bilge Özdemir, also of Emakchi said that housing demands are postponed due to speculations related to the expectation of loan interests dropping to the level of 1%. He added that “However, I do not believe that interest rate declines in would not have a great affect on a 120 month installment loan.”

Iran assures Asia Pacific Water Ministerial Council to be set up

Mehr News Agency quoted Mr Parviz Fattah energy minister of Iran as saying that the Asia Pacific Water Ministerial Council will be formed.

Mr Fattah said that the members of the council will annually hold the forum to coordinate water affairs. He added that “All developing states are convinced that Iran lacks no technical and managerial know how in water sector, enjoying proper ground for luring foreign investors.”

Baosteel buys into Xinhua Metal to consolidate sector

It is reported that Baosteel Group Corp has bought a tiny stake in Xinhua Metal Products Co in Jiangxi Province for CNY 200 million (USD 27 million), paving way for it to take control of the smaller producer later.

The local government and state asset regulator in Jiangxi Province are restructuring Xinhua Metal and hope to introduce companies like Baosteel as strategic investors to boost its competitiveness.

A Xinhua Metal official said."To get Baosteel in has been long discussed, and the private offer is only the first step." Xinhua Metal sold a total of 200 million shares via the private share placement to eight companies, which also include China Shipbuilding Industry Corp. Investors are subject to a one year lock up period for the new shares. Xinhua Metal manufactures products including steel plates for the shipbuilding industry. Shanghai based Baosteel has also been a long term investor in the sector.

Baosteel in March agreed with China State Shipbuilding Corp to construct China's largest shipyard with total investment of more than CNY 10 billion on Shanghai's Changxing Island. Baosteel has a 35% stake in it. Baosteel co invested in another shipyard in Shanghai's Waigaoqiao in 1999.

China's industry planner has been encouraging consolidation in the nation's highly fragmented steel industry, the world's largest.Baosteel has bought control of Bayi Iron & Steel in northwestern China's Xinjiang Uygur Autonomous Region and approached others such as Baogang Group, based in Inner Mongolia Autonomous Region, for acquisitions.

Pugang will construct the second COREX furnace in the world

It is reported that Pugang will construct the second COREX-C3000 furnace which could produce 1.5 million tonnes of molten iron per year. The project would be completed in 2010 with total annual production of over 3 million tonnes of steel.

The report added that second phase of the transference project of Pugang has been approved by National Development & Reform Commission recently.

Ansteel plans to build the first grain-oriented silicon steel mill

It is reported that Ansteel plans to build the first grain-oriented silicon steel mill.

Ansteel is the third Chinese steelmaker to produce grain-oriented silicon steel after WISCO and Baosteel. The project capacity is 100,000 tonnes per year and expected to be finished by early 2009.

96 dead in Coal mine explosion in China

Authorities in China's northern Shanxi Province said that 96 people were feared dead after a coal mine blast early Thursday morning in the village of Zuomu, near Linfen.

As of 3:00 PM local time rescuers said that 15 miners were rescued or managed to escape on their own when gas triggered an explosion underground. The State Administration of Coal Mine Safety confirmed that 40 miners were killed while 13 survived and said 74 miners were believed still trapped.

A total of 13 rescue teams were sent to the mine to search for more survivors in the Xinyao pit, owned by Ruizhiyuan Mining Co a licensed mining operator to produce 210,000 tonnes of coal annually.

Initial investigation showed that illegal mining activities in an unauthorized part of the mine may have caused the explosion.

Chinese mines were disaster prone with over 6,300 miners died in several mining accidents in 2003. Several dozens of miners died in early November in a gas leak in southwest China's Guizhou province.

China steel prices could rise 5% to 6% in 2008 to 2009

According to Lehman Brothers that high flying iron ore and coking prices would trigger production suspension and business failure of Chinese medium and small steelmakers. But the report believed industrial mix will become more reasonable.

Iron ore and ocean freight cost surge will curb China steel shares in short period, but from the long run, steel shares will firm up due to stable demand, backward capacity elimination and active M&A in China steel industry. During 2008 to 2009, China steel prices could rise 5% to 6%.

However, moderate increase in steel prices cannot pass on soaring cost. Lehman Brothers predict that iron ore contracted prices for fiscal 2008 could jump 50%, coking coal FOB price rise 22%. If CNY appreciate 5% against US dollar, only 7%YoY increase in HR price and 8.4%YoY increase in rebar price can fully digest rising cost.

China medium and small steel mills may only sustain production in view of rising iron ore spot prices and ocean freight. While large steel mills can purchase iron ore at low contracted prices, so they can enjoy 15%to 25% gross profit increase. High production cost and shrinking profits in small steel mills may exert active influence on China steel industry.

China’s steel exports sink to 18 month low

It is reported that China’s steel exports in October at 4.25 million tonnes, were at their lowest monthly level since May 2006. This was the sixth successive monthly fall from the peak of 7.84 million tonnes in April 2007.

The figures include semis, long and flat rolled product, tubes and wire. However, in the first ten-month, the export total of 58.6 million tonnes remains 50% up on 38.9 million tonnes exported in the same 2006 period. While China’s steel imports decreased by 9% to 14.5 million tonnes.

Nanjing steel raises EXW prices

It is reported that Nanjing Steel today pulls up EXW prices for some products.

1. Rebar up by CNY 130 per tonne
2. Round bar up by CNY 160 per tonne
3. High speed wire rod up by CNY 150 per tonne
4. Strip steel up by CNY 100 per tonne

Prices listed above are INCLUSIVE of 17% VAT, effective as of December 5th 2007.

China's Sinosteel plans domestic, HK IPO -paper

It is reported that State owned Sinosteel Group, China's largest steel trading firm plans an initial public offering in China and Hong Kong in the first half of 2008.

The Shanghai Securities News quoting an unnamed company executive said that Sinosteel will fold its major operating assets into a listing vehicle, which will issue yuan denominated A-shares in China followed by an H-share sale in Hong Kong.

The executive did not provide financial details of the IPO, but the newspaper quoted previous media reports as saying it could raise USD 1.5 billion.

SINOTRANS signed strategic framework agreement with Lian Yungang

It is reported that in order to strengthen the partner cooperation in port construction, land & bridge logistics and ocean lines and further develop bride transport as well as building up mutual trust, China National Foreign Trade Transportation Corporation signed strategic framework agreement with Lian Yungang Municipal Government.

Shougang enters into second iron ore COA with China Shipping

Interfax China reported that Shoudu Iron and Steel Group a leading Chinese state owned steel mill, entered into its second iron ore contract of affreightment with China Shipping Co on December 2nd 2007 in Beijing.

ZhongYe of Baosteel exploited 35-100 tons series slag tank transporter

It is reported that ZhongYe of Baosteel recently has been succeed in exploiting 35-100 tonnes series slag tank transporter, satisfies the different demands in Metallurgy enterprises.

As per reports ZhongYe of Baosteel is the first one to have exploited this special type transporter it has advantage in design manufacture, products upgrade and the price is low 30% to 40% compared with imported transporter.

China warns of excessive alumina and aluminium production

It is reported that China's National Reform and Development Commission has warned of excessive production from China primary aluminium and alumina sector and excessive investment growth in the lead and zinc smelting sector.

Investment in China lead and zinc smelting sector reached CNY 7.95 billion in January to September 2007 expanding 57.7% YoY, while investment in the domestic aluminium and alumina smelting sector stood at CNY 21.4 billion increasing 8.7%YoY. Investment in the domestic copper smelting sector amounted to CNY 7.76 billion over the nine month period up by 3.96%YoY.

The alumina/aluminium industry was expected to show strong growth this year as domestic processing capacity increased, especially electrolytic aluminium expansion, which had previously been subject to stringent control measures. Look for the government to introduce increased export duties.

Chinese steel sector stocks higher

It is reported that Chinese shares rose recently with the steel, nonferrous metal, new energy and medical instrument sectors leading the way.

Baoshan Iron and Steel remained strong after gaining more than five percent on Tuesday upon rumors about a possible bid by its parent company, the Baosteel Group, for mining giant Rio Tinto. Baoshan shares rose 6.63% to CNY 16.56 helping to drive up the whole steel sector.

Gansu Jiu Steel Group and Liuzhou Iron and Steel soared to the daily 10% limit, while Wuhan Iron and Steel, rose 8.45% to CNY 16.69.

NLMK acquires a controlling stake in Maxi-Group

OJSC Novolipetsk Steel the leading Russian steel producer has announced that it has entered into an agreement to acquire a 50%+1 share stake in OJSC “Maxi-Group” from its founder, Mr Nikolai Maksimov.

Novolipetsk said in a statement that payment would be made in two instalments: USD 300 million to be paid after the controlling stake has been transferred and another USD 300 million after due diligence. It said Maxi Group would carry out a capital increase of about USD 1.2 billion in the first half of 2008 to which Novolipetsk and Maximov would subscribe on a pro-rata basis.

The release said this acquisition is in line with NLMK’s strategy to expand its operations in Russia. NLMK believes the acquisition will give the company a significant share of the domestic long products market, particularly in rapidly developing regions such as Urals, Volga, and Central and Southern Regions. It also expects that the acquisition of Maxi Group will lead to NLMK’s 100% self sufficiency in steel scrap which is an important competitive advantage is given projected higher scrap prices in Russia.

Mr Aleksey Lapshin president of NLMK’s said that “The acquisition of a controlling stake in Maxi-Group advances NLMK’s strategy to fully serve the domestic market needs. Demand for long products for the construction sector is growing rapidly making these markets highly promising. Maxi Group’s acquisition provides a new catalyst for NLMK’s dynamic development, enabling the company to strengthen its leadership in the supply of finished steel products in Russia. We are confident that this acquisition will help us to meet rising demand from the growing domestic economy, develop new markets and gain further competitive advantages for the future growth of NLMK.”

Russia's Gazprom posts 0.7% decline in IFRS net income in H 1 2007

RIA Novosti reported that Gazprom net income calculated to International Financial Reporting Standards dropped by 0.66%YoY in January to June 2007 to RUB 330.05 billion (USD 13.5 billion).

Gazprom said that its sales increased by 5% in the reporting period to RUB 1,143 billion (USD 46.7 billion) while operating profit declined by 13.17% to RUB 351.68 billion (USD 14.4 billion).

Yanukovych insists on development of coal industry

Mr Viktor Yanukovych PM of Ukraine said at the Cabinet session that Ukraine must reform coal industry and would be carried out by Mr Serhy Tulub Coal Ministry.

According to PM, Ukraine has never suffered from such accidents which happened in Zasyadko mine. He has noted that those happenings in Zasyadko mine are unknown for coal industry. Scientists do not know which gases are in the mine because they did not manage to get tests from mine. According to international scientists these are mixtures of heavy gases.

Mr Yanukovych informed that he had very thorough conversation with the Mr Viktor Yushchenko president of Ukraine with emotional and strict conditions and demands from the President. “I agree with such position. He noted that it is necessary to develop science in Ukraine and change attitude to issues on Labour protection and parameters of finances allocated to solution of these issues.”

Tymoshenko wants to scrap gas deal

It is reported that Mr Yulia Tymoshenko the former Ukrainian prime minister wants to scrap a natural gas accord with Russia, raising concern that a price dispute between the two countries could be repeated.

As per report Ukraine agreed to pay Russia USD 179.50 per 1,000 cubic meters of gas next year, while it initially only expected to pay up to USD 160. Russia, which supplies a quarter of Europe's gas supply mainly through Ukraine will pay its former Soviet Union partner a transit fee of USD 1.70 per 1,000 cubic meters of gas per 1,000 kilometers, compared with the USD 1.60 that it pays now.

Mr Tymoshenko in a statement said that "The price of USD 179.50 per thousand cubic meters of gas shows the fiasco of the current Cabinet's energy policy. We will have a chance to start talks again with Russia after the new Cabinet is formed."

Russia's Gazprom plans RUB 35 billion bonds in 2 years

Reuters reported that Russian gas export monopoly Gazprom plans to issue RUB 35 billion of bonds in 2008-2009.

A official told Reuters on the sidelines of a bond conference in St Petersburg that "The decision is already on the table. They would place RUB 20 billion of bonds next year, and RUB 15 billion in 2009, adding that Gazprom planned no domestic borrowings before the end of 2007.

In September, Gazprom said it had mandated Citibank and its own banking arm, Gazprombank to organize five bond issues worth a combined RUB 35 billion.

Pipeline to China cost hits USD 12 billion

Reuter cited Russian energy official as saying that the cost of an oil pipeline from Russia to China has risen to USD 12 billion and the countries' struggle to agree on a pricing deal for a similar gas pipe could drag on for years.

Mr Vladimir Sayenko deputy head of the fuel and energy department at the Industry and Energy Ministry said that a global escalation in raw materials prices and the depreciation of the dollar boosted the link's costs. He said "Currently we are talking about approximately USD 12 billion. This has to do firstly with the fact that pipes got more expensive, the dollar to euro exchange rate and some other global economic trends."

He added that originally budgeted at less than USD 7 billion and recently quoted at around USD 11 billion, the spiraling costs meant an agreed price of near USD 40 per tonne would now likely have to be renegotiated. But the project was still set for completion near an end-2008 target date.

Mr Viktor Khristenko Industry and Energy Minister said last month that the schedule to complete the first 600,000-barrel-per-day section of the pipeline by the end of 2008 was still in force.

VCNG to finish laying oil pipeline in May 2008

Interfax cited Mr Mugammir Galiullin General Director of VCNG as saying that Russia's Verkhnechonskneftegaz Company plans to finish laying an oil pipeline from the Verkhnechonsk oil and gas condensate field in Siberia to the Eastern Siberia-Pacific Ocean trunk pipeline in May 2008.

Mr Galiullin said VCNG is licensed to develop Verkhnechonsk and the board of directors would approve the company budget for 2008. He said VCNG might issue shares in addition to the issue that it had announced before and that is designed to raise funds for repaying loans.

Earlier reports said the pipeline to connect Verkhnechonsk to the ESPO would cost about RUB 7 billion to lay. It would be about 100 kilometers long. Its juncture with the ESPO would be located in the vicinity of the Talakan oil and gas condensate field, also in Siberia.

Verkhnechonsk contains C1 oil reserves of 159.5 million tonnes, C2 oil reserves of 42 million tonnes, C1 condensate reserves of 400,000 tonnes, C2 condensate reserves of 2.9 million tonnes, C1 gas reserves of 56 billion cubic meters and C2 gas reserves of 105 billion cubic meters.

A-TEC first-ranked bidder for RTB Bor

Serbia & Montenegro Today' reported that at the second session of the tender commission in charge of the implementation of the public tender for the sale of basic assets and transfer of exploitation rights of the mining and metallurgical industry RTB Bor a unanimous decision was made to approve results of the tender.

The report said that the consortium comprising A -Tec Minerals and Metals Holding GmbH, A-Tec Industries AG and Montanwerke Brixlegg AG has been declared the first ranked bidder, whereas Strikeforce Mining and Resources Ltd is the second ranked.

Once the tender list is announced, the Privatization Agency will within five days invite the first ranked bidder to negotiations limited to 30 days with a possibility for another 30 day extension.

RTB Bor Group is composed of the following sub sections: Copper Mine Bor in restructuring from Bor, Copper Mine Majdanpek in restructuring from Majdanpek and Cooper Smeltery and Refinery in restructuring from Bor.

OPEC countries reject consumer calls for oil output increase

RIA Novosti reported that the Organization of the Petroleum Exporting Countries decided at a meeting recently to keep output at current levels despite consumer calls for an increase.

The Indo Asian News Service quoted Mr Mohammed Bin Dhaen Al Hamli OPEC President and minister of energy of the United Arab Emirates as saying that "The market continues to be affected by price volatility. The widespread erroneous perception of current market tightness and the fear of future shortages appear to have fuelled increasing speculation in the futures market."

He said that "In the light of this volatility, it is important to restate clearly that OPEC remains committed to a balanced, stable market, with secure uninterrupted supplies at reasonable price acceptable to producers and consumers alike."

The conference was attended by ministers of OPEC member states and observers from Egypt, Oman, Russia, Sudan and Syria.

TNK-BP to supply 500,000 metric tonnes of oil to China in Q1 2008

RIA Novosti reported that TNK-BP had filed an application to Russian pipeline monopoly Transneft to pump 500,000 metric tonnes of oil to China in the first quarter of 2008.

Mr Jonathan Kollek VP for sales and logistics of TNK-BP said the Russian-British JV planned to supply oil via Transneft's pipeline network to Kazakhstan's Atasu-Alashankou pipeline running to China.

Mr Kollek said oil supplies to China by rail had not been economically viable until the company put into operation an oil terminal in the Novosibirsk Region in western Siberia, and said that the terminal could be launched in the first quarter of 2008. He said the terminal will allow TNK-BP to export 100,000 metric tons a month of high quality oil to China, Kazakhstan and the Black Sea coast, via the Caspian oil pipeline or through the Russian Black Sea port of Novorossiisk.

TNK-BP also plans to cut oil exports by 9.3%YoY by the end of 2007 to 36.7 million tonnes while exports of refined products are set to end the year 4.8% higher at 15.28 million tonnes.