ArcelorMittal to finalize Orissa plant DPR by March

BS reported that ArcelorMittal, which plans to set up INR 40,000 crore 12 million tonne per annum Greenfield steel project in Patna tehsil of the Keonjhar district in Orissa, announced that its detail project report for the plant would be ready before March 2008 as against earlier target date of June 2008.

Mr Sudhir Maheswari executive VP and member of the management committee of ArcelorMittal while talking to the media after meeting Mr Ajit Tripathy chief secretary of Orissa said that the project is progressing smoothly. He said “A 20 member team from Luxemburg, France and Brazil is finalizing the DPR and the team is expected to submit the DPR before March 2008.”

DPR will include captive mining, captive power supply, water supply infrastructure and other facilities like townships for the company's employees.

ArcelorMittal signed MoU with the Orissa government in December 2006 for setting up a steel plant at an investment of about INR 40,000 crore.

Steel ministry recommends Navratna status for NMDC

PTI reported that the Steel Ministry has recommended granting Navratna status to nation's biggest miner NMDC Limited for excelling in its activities and unfurling major capacity expansion plans. Steel ministry has written to Department of Public Enterprises in this regard.

A top Steel Ministry official told PTI that "From a modest profit of about INR 48 crore in 1990-91, NMDC has come a long way to pay the highest dividend of 352% in 2006-07 with production of about 27 million tonnes of iron ore and a profit of over INR 2,300 crore. So, clearly there was a case for recommending Navratna status to NMDC.”

NMDC is a Miniratna-1 company. Granting of Navratna status would enable NMDC to establish financial joint ventures and wholly owned subsidiaries in India or abroad.

NMDC would invest about INR 18,000 crore to ramp up its production capacity to 50 million tons and conduct fresh explorations within the next five years. Mr Rana Som CMD of NMDC had recently said that "We would invest about INR 18,000 crore in the next five years to ramp our production capacity to 50 million tonnes of iron ore, besides conducting fresh explorations.”

JSW Bengal Steel to double capacity by 2011

BS reported that JSW Bengal Steel is likely to double the first phase capacity of its project to 6 million tonnes as it has tied up the required raw material linkages.

Mr Biswadip Gupta joint MD & CEO of JSW Bengal Steel said that 3 million tonnes would be on stream by March 2011 and 6 million tonnes would be operational by June 2011.

The investment in the first phase would be in the region of INR 15,500 crore to INR 18,000 crore. The total project would cost around INR 35,000 crore. The project would achieve financial closure in 3 months’ time. It would be financed through a mix of debt and equity.

Mr Gupta announced that JSW Bengal Steel would go for an initial public offering but did not specify a timeframe. The IPO would give an exit option to the land owners who received free shares of JSW Bengal Steel as part of the compensation package.

JSW Bengal Steel is on the verge of completing land acquisition for the project, with a mere 10 to 15 acres of private land still to be acquired. The total land requirement was a little less than 5,000 acres, of which 90% was vested with the state government. The project recently got clearance from the ministry of environment and forests.

TATA Steel’s update on expansion plans in India

TATA Steel is investing INR 42,000 crore in adding new steel plants at Kalinganagar in Orissa and Jamshedpur in a few years and has kicked off the expansion program at Jamshedpur to raise capacity from 7 million tonne to 10 million tonne recently.

Mr Muthuraman MD of TATA Steel said that it would invest INR 20,000 crore in the Jamshedpur plant for scaling up capacity from 5 million tonnes to 10 million tonnes. It has already spent INR 6,000 crore on increasing capacity from 5 million tonnes to 7 million tonnes.

The investment in Kalinganagar will be around INR 20,000 crore. Mr Muthuraman said that Kalinganagar project was facing problems on land acquisition while the former was delayed due to delay by the state government in announcing a rehabilitation and resettlement policy.

Mr Muthuraman said that “Our Greenfield projects in Jharkhand and Chhattisgarh are some distance away. Work on Chhattisgarh project was to start in 2008 and would be commissioned in 2012. Jharkhand project, which is likely to commence in 2009, will start operations by 2013.”

Goa does not want any SEZ

Exim News Service reported that union government has received a formal communication from the Goa government asking that all the special economic zones should be withdrawn, including those already notified in the state.

It is learnt that the Goa government has said that it would not be in a position to implement SEZs because it would not be able to provide basic amenities like power etc.

Mr Kamal Nath union commerce & industry minister has acknowledged that he had received the letter from the Goa government but he did not elaborate on the finer details of the letter.

Maa Mahamaya to double capacity after iron ore linkage

BL reported that Maa Mahamaya Industries Limited plans to double the capacity of its mini integrated steel plant at RG Peta village in L Kota mandal of Vizianagaram district of Andhar Pradesh in the next 5 months if the iron ore linkage is granted by the National Mineral Development Corporation

Mr Ashok Kumar Agarwal CMD of Maa Mahamaya Industries Limited said that the installed capacity of 120,000 tonnes of billets and TMT bars would be doubled. He said “NMDC has not given us any assured iron ore linkage so far and we are sourcing our raw material from Bellary in Karnataka and Orissa. Once we get the linkage, we plan to double the capacity.”

Mr Agarwal said that Mahamaya has invested INR 290 crore in setting up the plant in an area of 103 acres, which would be sufficient for expansion, with the debt-equity ratio being 2:1. He said “We need to have INR 250 crore or so for expansion and there is no problem with funds. We only have to get ore linkage.”

Mr Sandeep Tiwari VP finance of Maa Mahamaya said that sale of TMT bars and a billet in the first 6 months of commercial production was INR 103 crores. In the current fiscal, the achievement till December 31st 2007 was INR 169 crores against the target of INR 250 crores and the contribution of the company to the state government in the form of sales tax and excise duty was around INR 50 crores.

Indian major ports TEU traffic in 8 months up by 22.2% YoY

According to the Indian Ports Association, major ports handled 4.53 million TEUs in April to November 2007 period up by 22.16% YoY as against 3.59 million TEUs handled in April to November 2006.

The surge in container throughput has been attributed to a rise of up to 25% in the volume of exported goods handled by major ports in 2007, particularly finished goods that require transportation in container boxes.

Jawaharlal Nehru Port, which handles over 55% of box trade, led from the front.

China to invest in hydro electricity in India

Chinese leaders told Mr Kamal Nath India’s union commerce minister that Chinese government is extremely keen on investing in hydro electricity projects in India.

Mr Nath, after his meeting with Mr Chan Deming Chinese commerce minister, said that "The Chinese minister said they are willing to invest in hydro electric projects in India. He said there is great potential for partnership in this sector between the two countries. He said the Chinese government wants to invest in clean energy sources like hydroelectricity."

This is seen in Indian government circles as an attempt to establish Chinese commercial presence in the disputed Arunachal Pradesh, known for its awesome and untapped potential of hydro electricity, apart from other places in the country.

MEA approves SCI shipping line JV with South Africa

Exim News Service reported that Ministry of External Affairs has tentatively approved union shipping ministry’s suggestion for setting up a shipping line with South Africa and will enter into a MoU with the South African government to set up shipping services between the 2 countries.

As per the terms of the agreement, a JV company is expected to be set up between the Shipping Corporation of India and a new private shipping company to be launched by South Africa.

SC allows Reliance Power IPO launch

It is reported that the Supreme Court on weekend passed a blanket interim order allowing Reliance Power Limited to launch its INR 10,000 crore initial public offering as scheduled on January 15th 2008 notwithstanding any order passed by any other court in the country against the IPO.

A three Judge Bench comprising the Chief Justice Mr KG Balakrishnan, Mr Justice RV Raveendran and Mr Justice JM Panchal, passed this order on an urgent application moved by Reliance Power seeking stay of the proceedings in a suit initiated in Mumbai against the launch of the IPO.

The Bench in its brief order said “Interim stay of the proceedings in the suit before the City Civil Court, Mumbai. The IPO of RPL may be continued despite any interim ex parte order passed by any other court.

The said IPO is for the purposes of establishing large thermal power projects of the Government of India with private participation to generate 28,000 MW.

Maneri Bhali II hydel project to start operations

BS reported that faced with a severe power crisis, Uttarakhand can now pin its hopes on the controversial 304 MW Maneri Bhali phase II hydel project that is expected to begin production from January 14th 2008. Though top officials of the state run Uttarakhand Jal Vidyut Nigam Limited, which is implementing the project, are confident of generating 76 MW from January 14th 2008, district officials said that no date had been finalised for the commissioning of the project.

The project was scheduled to be commissioned on November 9th 2007. But due to some technical and rehabilitation problems, the project was delayed.

Mr BC Khanduri chief minister of Uttarakhand had recently said that the problems like rehabilitation related to the Maneri Bhali project would take priority over the commissioning.

The project, which was revived in 2002, was scheduled to be commissioned in 3 years’ time. But it mired into controversies like alleged financial irregularities, and is now being plagued by rehabilitation issues. The project ran into fresh controversy lately when it was found that it would submerge vast areas of Joshiyara and Gyansu. The people in both the areas are now seeking compensation from the government.

The project, which has 4 units of 76 MW each, will have 16 kilometer long diversion tunnel for which a barrage has also been built. The civil work of the project is being carried out by the state irrigation department.

Aker Floating secures USD 1.1 billion Reliance contract

It is reported that Norwegian oilfield services group Aker Floating Production has agreed to provide a floating production unit to Reliance Industries for 10 years for a revenue stream of USD 1.1 billion.

Aker Floating said in a statement that Reliance Industries chose to exercise an option for a bare boat contract for the Aker SMART 1 floating production, storage and offloading unit. It added that over the 10 year duration of the contract this amounts to USD 1.1 billion of bare boat revenues.

Elecon gets crusher and wagon tippler orders from cement firms

Elecon Engineering Company Limited has announced that it has received combined orders worth INR 157.4 million for supplying crushers and wagon tipplers to some cement companies.

Gujarat ready to achieve growth target of 11.2% - Mr Modi

Mr Narendra Modi chief minister of Gujarat, unveiling his newly formed BJP government’s agenda for the next 5 years, recently said that his government would strive to achieve the growth target of 11.2% fixed by the Planning Commission for the state during the coming Five Year Plan.

Mr Modi said that although this target was rather high, Gujarat would make an all out effort to achieve it by following an integrated approach towards agriculture, industry and services. He added that another important feature would be completion of all development works undertaken in relation to the Narmada water projects by 2010 when Gujarat celebrates the Golden Jubilee of its creation.

Mr Reddy plans new steel plant in Karnataka

Mr Janardhan Reddy a BJP leader has announced the setting up of a steel industry in Karnataka on the lines of Brahmani Steel Industry in Kadapa district of Andhra Pradesh.

Addressing a news conference on the occasion of his birthday, Mr Reddy said that the work would begin after the BJP comes to power in the state after the assembly polls. He added that he was prepared to accept any responsibility given to him, to bring the party back to power in the state with a full majority and though he was suspended he would continue to work for the party.

Dolphin Offshore plans to foray into light rig operations

It is reported that marine operation and construction major Dolphin Offshore Enterprises India is planning to get into providing coast to coast shipping, light rig operations and harbour management services through its subsidiary Procyon Offshore Services. It is targeting a 25% to 30% increase in revenues

Mr Navpreet Singh joint MD of Dolphin Offshore said that “We see a huge opportunity in these emerging services and are looking to commence the services within a year or so. The plans are still at the drawing board and we need to conceptualize and get regulatory and other approvals before the idea can take off. We would look at entering into working relations with companies who need these services.”

According to industry analysts, the coast to coast shipping industry is alone estimated to be worth around INR 1,000 to INR 1,500 crore. In this industry, goods are proposed to be moved from one coast of the sub-continent to another, which is economical compared with movement of goods by road. Light rig operations and harbour management services are new sectors for which the industry size could not be ascertained.

Dolphin Offshore Enterprises undertakes offshore and onshore oil and gas construction activities and provides support vessels and barges. It is also moving into shipbuilding activities, jointly with the Gujarat Maritime Board and has acquired 200 acres of land at Jafrabad in Gujarat.

Iron ore freight rates dip on easing port congestion

Platts reported that freight rates for iron ore cargoes originating in the Atlantic have fallen sharply this week as more ships have become available globally on the spot market that were previously tied up in port congestion.

The latest business has seen the key Brazil to China iron ore rate fall close to the USD 77 per tonne mark, having started the week at around USD 80 to USD 82 per tonne. This is down sharply from all time highs of just over USD 100 per tonne seen in the first half of November 2007.

Ship brokers attribute the sharp fall in freight rates to an easing of port congestion, which has freed a large number of ships that were previously tied up in port congestion. The worst congestion was on the east coast of Australia's major coal export terminals, where the queue for ships awaiting loading berths in Newcastle, New South Wales, peaked at 37 vessels, waiting an average of 22 days in early October 2007.

POSCO likely to bid for Daewoo Shipyard alone

It is reported that POSCO has expressed its intention to make an independent bid for Daewoo Shipbuilding & Marine Engineering and has set aside a budget of around KWR 2.6 trillion.

Mr Lee Ku-taek chairman of POSCO while attending a forum on January 10th 2008 disclosed that “Interest in acquiring DSME still remains, but a joint purchase with other steelmakers is not being considered.”

On the contrary, POSCO stressed that it is fully armed to undertake an M&A on its own. Mr Yoon Seok-man CEO of POSCO reasoned that “POSCO’s 2008 investment was greatly increased since. The extra expense that could be used for M&A was reflected in the budget. POSCO’s interest in acquiring DSME has not changed.”

Mr Jang Se-ju chairman of Dongkuk Steel had recently mentioned that acquiring DSME via forming a steel industry consortium could be another method.

POSCO had planned to invest KWR 5.9 trillion in 2006 but only executed KWR 3.8 trillion leaving around KWR 2 trillion of investment budget as reserve.

Kloeckner & Co to continue acquisitions in 2008

Reuters reported that German metals distributor Kloeckner & Co KCOGn.DE aims to boost sales by a tenth this year by purchasing more financial assets in 2008.

The report cited Mr Thomas Ludwig chief executive of Kloeckner & Co as saying that "Through acquisitions we aim to achieve revenue growth of around 10% once again."

He said the company is mainly looking for targets in the United States and Europe, in particular in Eastern Europe as well as expanding its product range to include higher grade and specialty steels. He added that financing the purchases should not be a problem.

Kloeckner & Co acquired 12 companies with combined sales of about EUR 570 million in Europe and North America in the nine months through September 2007.

Hyundai Steel paying USD 435 for scrap purchase - Report

YIEH is reported that South Korean Hyundai Steel purchased 27,000 tonnes of H1 scrap from American Schnitzer at C&F USD 434.5 per tonne for February 2008 delivery. Among them, 10,000 tonnes is shredded scrap, and the other is H1 and H2 mixed scrap.

In addition, Hyundai Steel also purchased 30,000 tonnes to 35,000 tonnes of scrap from Australian Sims Group with C&F USD 435 per tonne.

Ecometals inks JV pact with Alto Tocantins Mineralcao in Brazil

Ecometals Limited has announced that it has entered into a joint venture agreement with its Brazilian partner, Alto Tocantins Mineralcao Ltd related to the Serra do Navio manganese property and the Matapi iron prospects.

The agreement establishes two new companies registered in Brazil that will hold the titles for the mineral concessions one company for manganese assets and the other for iron assets.

The agreement stipulates that exploration of the properties will be directed by Ecometals. Upon commencement of commercial production, the enterprise will be governed by a three person board of directors, of which Ecometals will have two representatives and Alto Tocantins will have one representative.

Mr Fran Scola CEO of Ecometals said that "We are very pleased to have established this joint venture for two great projects, in a world class mineral province. He said that what is so exciting about these projects is the ability to commence production in the near term in an area that already has excellent existing infrastructure."

Ecometals Limited is a Canadian listed mineral exploration and development company focused on mineral resources in Latin America. Ecometals also holds 44.4% of Atomaer Holdings Pty Ltd a private Australian holding company.

South Korea eying resources in Africa and South America

It is reported that South Korea is aiming to expand its raw material exploration and development in African and South American countries.

The Korea Resources Corp said the plan calls for greater allocation of funds for overseas projects that can diversify foreign sources of key materials. It said the funds for natural resource projects this year will reach KRW 270 billion compared to KRW 160 billion last year.

A spokesman for the corporation said that "Through aggressive development and exploration, the plan is to raise self sufficiency in key resources to 23% this year from 18.2% in 2007."

He added that efforts are underway to boost the size of the corporation’s capital holdings from the current KRW 600 billion to around KRW 2 trillion which he said would allow the organization to invest more on promising projects.

The Korea Resources Corp also said further efforts are to be made to develop zinc, molybdenum and gold from local mines.

Territory Resources ramps up production

Australian resources group Territory Resources has exported 340,000 tonnes of high grade iron ore via 5 shipments from the Port of Darwin to China, following the sailing of its first shipment in September 2007.

Mr Michael Kiernan chairman of Territory Resources said that the company's operations were operating consistently and on schedule. He added that "Territory's shipping program has gathered steam, as we continue to ramp up production at Frances Creek and capitalize on the robust iron ore market. The current mine plan is scheduled to produce at an annualised mining rate of 2 million tonnes per annum by June 2008 and is targeting 3 million tonnes per annum by December 2008. We are continuing to lift rail and port capacity to drive further production increases, and deliver value to shareholders."

Territory is working to expand capacity and loading efficiency at port, in consultation with the Darwin Port Corporation and the Northern Territory Government.

Global coal industry index launched

It is reported that the Stowe Global Coal Index of 60 global coal industry stocks has commenced real time price dissemination

The capitalization weighted, float adjusted index incorporates companies engaged in five primary coal sectors: coal mining and production, coal transportation, coal technology, coal mining equipment and coal power generation. . Data is available through most data vendors.

S&P Custom Indexes serves as calculation agent for the indexes. The Stowe Global Coal Index has been licensed to several financial services firms, who plan to offer listed investment and risk management products, including ETFs, on the index.

Mr Says Joseph LaCorte Chairman of the Stowe COAL Index Committee said that “Coal, which accounts for over 25% of world energy output and is essential to the production of steel, cement and polysilicon chips and wafers, is one of the world’s most overlooked commodities. A global index is the best way to measure this important industry’s financial dynamics.”

Mr Mike Keenan Stowe Index Committee member said that “With persistently high petroleum prices and supply constraints, the abundance and low cost of coal secures its role as a fundamental resource in the global economy. Technological advances in clean coal, coal-to-gas, coal to liquid and sequestration creates a path for coal to assume an even greater role in the years ahead. COAL is the bell weather for industry development.”

Vessel queues at DBCT costing USD 500 million annually

It is reported that the chairman of a new board to monitor coal shipping at Darymple Bay said the industry is wasting USD 500 million a year as ships wait for coal off the north Queensland coast.

Mr Seamus French CEO of Anglo Coal heads the Dalrymple Bay Coal Chain Board and its first task will be to create a more coordinated system to move coal on trains from the mines to ports.

Mr French says Dalrymple Bay was operating 10 million tonnes under capacity in 2007, but that needs to improve by 100% by early next year.

He said that "We have been seeing queues of 46 ships waiting on average 25 days off port to load and those demurrage costs, collectively for the industry have been in the order of half a billion."

Dongkuk Steel increases section prices

It is reported that South Korea Dongkuk Steel has decided to increase its steel section prices by about USD 42 per tonne to USD 53 per tonne in order to offset higher production costs of scrap and billet.

Accordingly, H beam price will be about USD 767 per tonne and common section steel price will be about USD 752 per tonne.

Rebar prices surge in Bangladesh

It is reported that Bangladesh steel and re rolling millers are facing tough times as raw materials of the products shot up on the international market, thereby adversely affecting the housing sector. Moreover, the duty enhancement in the last budget has added to their production cost, which ultimately led to an abnormal price hike of MS rod and iron bar on the domestic market.

A year back, the 40 grade MS rod was selling at BDK 40,000 per tone while the 60 grade rod's price was BDK 52,000 per tonne. This price rise has led to a major debacle for the country's real estate sector that has to account extra expenses on the budgeted construction cost.

Mr Sheikh Masadul Alam Masud General Secretary of Bangladesh Rerolling Mills Association blamed the duty enhancement in the country's present fiscal budget and sudden increase of the raw materials' prices internationally for the present crisis on the domestic steel market.

He said the caretaker government in the current budget enhanced the import duty on melting and re rollable scraps and the sponge iron which are used as row materials in the steel and re rolling mills for producing MS rods and iron bars.

Mr Masud said that "Now, we have to import our raw materials at 30% to 40% higher rates than that of last year's price. He said in addition to the international market's odd situation, the steel and re rolling millers has been facing some difficulties domestically as well.”

Taiwan's coal import in December down by 20% YoY

According to Taiwan’s customs statistics, the import of coal was 5.65 million tonnes December of 2007 an increase of 917,000 tonnes or 19.3% compared to the same time last year.

Australia accounted for 2.34 million tonnes, Indonesia 1.86 million tonnes and China provided 1.12 million tonnes.

Taiwan also imported 42,000 tonnes of coke in December an increase of 4,000 tonnes as compared to the same period last year.

Aljustrel zinc mine in Portugal restarts production

Swedish producer Lundin Mining has recently announced the re start of production at its Aljustrel zinc mine in Portugal.

The mine had been on care and maintenance for 14 years will reach full production during the first quarter of 2009, at which stage it will produce 80,000 tonnes per year of contained zinc and 17,000 tonne per year of contained lead.

The current mine life is estimated to be 10 years but Lundin is committed to trying to delineate more reserves to extend the life.

Fitch Ratings affirms ‘BBB-‘ IDR ratings for CSN

Fitch Ratings has affirmed the 'BBB-' foreign and local currency issuer default ratings of Companhia Siderurgica Nacional and the company's 'AA (bra)' national scale rating. The rating outlook is stable.

Fitch has also affirmed the 'BBB-' ratings assigned to CSN's unsecured debt obligations issued by its wholly owned CSN Islands subsidiaries, and the 'AA (bra)' national scale ratings assigned to CSN's Brazilian debenture issuances.

Zambia sees USD 400m in revenue from new mining tax

Mr Levy Mwanawasa President of Zambia said that it will introduce a windfall mining tax in 2008 to generate USD 400 million. He added that the new tax regime would effectively increase mining taxes to 47% from 31.7%.

Mr Mwanawasa said that "The new regime introduces a windfall tax and a variable profit tax that has been designed to work in periods of both high and low prices and for both high and low cost mining projects." He blamed tax 5 to 20 years incentives awarded in recent years to firms for creating an imbalance in mineral wealth between the state and private sector.

He said "Clearly, Zambia's fiscal mining regime is extremely generous and provides the lowest revenues to the government. This to a large extent has been a source of public outcry. In view of this, there will no longer be any need for special agreements with investors in the mining sector and eventually all the sectors."

Mr Mwanawasa said that a new regulatory regime would be introduced to safeguard foreign investments in mining. He said "It will have a modern licensing system based on transparent procedures and will provide for transparency in the accounting and utilization of mineral revenues."

Mr Mwanawasa said that in 2007, Zambia collected USD 142 million in mineral royalty and company tax from earnings of USD 4.7 billion in copper and cobalt exports by foreign owners of its vast copper and cobalt mines, despite a 400% increase in global metals prices in the past 7 years. He added that foreign mining firms were expected to earn up USD 4 billion this year if metals prices kept at current levels.

Zambia government has been pressured by unions over the past few years to spread the benefits of its copper wealth, the mainstay of its economy, to its citizens and workers in the industry who complained of poor wages. Zambia has been in negotiations with mining companies since October 2007 about proposed increases in mineral royalties, corporate taxes and customs duties on imported equipment, as a way of boosting revenue from the sector. The copper mines are a major employer in Zambia.

Chinese banks lift restrictions against Iran

Mr Asadollah Asgaroladi chairman of Iran China Chamber of Commerce said that restrictions earlier imposed by 5 Chinese banks against Iran have been lifted. He added that several delegations sent by the chamber to Beijing managed to convince the Chinese officials to lift restrictions imposed by 5 out of 12 banks. Mr Asgaroladi said “Of the 12 Chinese banks that severed their ties with the country due to political reasons, five restarted their transactions.”

He added that currently 40% of problems between Iranian and Chinese banks, caused by the UN Security Council resolution, have been resolved. He said “The stoppage of banking businesses has not harmed bilateral trade yet and transactions are conducted via banks based in neighboring countries and cash payments.”

A Chinese source who follows Iranian Chinese commercial ties said there had been no official Chinese announcement on financial limitations on Chinese banks doing business with Iran. It added that “Maybe this action by the banks is based on some internal risk management because every bank has their own risk management.”

The Bush administration since October has constantly tried to sanction Iranian banks while financial institutions in Russia, China, and much of the Middle East have declined to cut ties. Washington has so far blacklisted Iran’s BMI, Bank Mellat, and Bank Saderat. These sanctions stem from an executive order that Mr Bush issued in 2005 giving him unprecedented power to blacklist foreign banks. According to this authority the U.S. government can shut any bank out of the US financial system without ever having to make its evidence public or even share the allegations with the banks themselves

China has become an increasingly important trading partner of Iran with bilateral trade at about USD 15 billion in 2006. USD 20 billion bilateral trade target for 2007 could not be achieved if difficulties with letters of credit persisted.

Steel and cement price likely to increase further in MEA

Arabian Business reported that rising costs could also force investors to look to other Middle Eastern countries for business opportunities. By the end of January 2008, steel prices are expected to reach USD 816 per tonne and cement could touch USD 95 per tonne in Middle East.

Mr Ani Ray country director of Simplex Infrastructure said that the situation would particularly affect Dubai. He said "At least in Abu Dhabi, the contracts carry a price variation clause which makes it better for the contractors, but in Dubai most of the contracts are lump sum. We could expect to see many of the smaller companies folding up this year due to these escalating costs. Cement could go up to USD 95 per tonne by the end of this month while steel could touch USD 816. This is going to directly affect construction here.”

Sub contractors and contractors are going to burn their fingers due to their contract types and so many projects will be delayed. Something needs to be done about it because as of now, it's the developers alone who will see an increase in profits.

Mr Chris Lobel GM of ready mix concrete Conmix feels that the situation could also force investors to look at other less expensive markets like Kuwait and Saudi Arabia. He said "Adding an escalation clause is the best thing for all parties including the developer and I don't understand why no one sees that. Contractors are adding huge margins into the contracts. Sometimes, they add a 30% escalation estimate when it is actually a 10% one. The developer can avoid this by just paying the real difference instead of agreeing to an overestimated lump sum.”

DP World to go ahead with India plans despite Mundra setback

DP World, which has suffered a setback with Gujarat High Court upholding Gujarat Maritime Board decision to terminate DP World’s sub concession agreement to run the first container terminal at Mundra international container terminal, has decided to go ahead with its India plans involving a further investment of USD 500 million in the next few years.

Mr Jamal Majid bin Thaniah executive VC of DP World had announced at Mundra on November 5th 2007 to further invest USD 500 million in India. He said that “In fact DP World had all the necessary approvals. Certain interested lobbies created an atmosphere of insecurity. DP World is majority owned by the Dubai government and hence there are no issues regarding security. The government of India is extremely comfortable with DP World who has been in India since 2002, much prior to acquisition of P&O Ports.”

The Adanis had originally developed the first terminal at Mundra which was being operated by P&O Ports. Later, DP World acquired P&O and started running MICT. Gujarat Maritime Board objected to it and terminated DP World’s sub concession agreement, against which DPW moved an Ahmedabad court, and then the High Court, both of which upheld GMB’s decision.

Since last year, DPW was locked in a legal battle with the Adanis over the transfer of ownership of second container terminal at Mundra from P&O Ports to MICT.

DP World, leading global port operator with 42 container terminals across 22 countries, has so far invested USD 1.50 billion in India where it operates the Nhava Sheva International Container Terminal in Maharashtra and ports at Chennai, Kolkata and Vishakhapatnam, besides MICT. It handled 4 million TEUs in India in 2006-07, including 650,000 TEUs at MICT.

Saudi government urged to cut dollar exposure

Saudi Arabia's largest state bank National Commercial Bank has urged the government to reduce the kingdom's exposure to the dollar by investing more assets outside the United States and gradually changing the riyal’s peg to the weak US currency. It said the world's largest oil exporter should set up a sovereign wealth fund to invest surplus revenues, now partly managed by the central bank, which has USD 285 billion in foreign assets.

Mr Said al Shaikh chief economist of National Commercial said that “Time has come to reconsider the continued pegging of the Saudi riyal to US dollar, provided that this is done gradually, taking into account the unfavorable impact on official reserves, which are mostly denominated in dollars.”

Mr Shaikh said that the government should set up a sovereign fund to increase the returns on investment of most government surpluses, which are currently invested in US Treasury bonds. The kingdom should diversify government investments across asset types, countries and different currencies to reduce risks and increase profitability.

UAE is most globalize Arab country

According to a recent report by Centre for Research in Economics, Management & the Arts, United Arab Emirates has topped Arab countries as the most globalized followed by Saudi Arabia.

According to the index measuring the economic, social and political dimensions and ranging from economic openness to attractiveness, the UAE is the world's 35th most globalized country followed by Saudi Arabia, which ranks 36th and Kuwait, which ranks40th.

A total of 24 sub indices and criteria refer to the country's actual economic flows, economic restrictions, attractiveness to foreign direct investments, information flows, quality of telephone and internet services, numbers of foreigners and the like.

The world's most globalized country is Belgium, followed by Austria, Sweden, Switzerland, Denmark, the Netherlands and the United Kingdom.

DP World consolidates Dubai cargo handling at Jebel Ali

Global marine terminal operator DP World has announced that it is moving its general and non containerized cargo handling operations at Port Rashid in central Dubai to its flagship facility at nearby Jebel Ali.

Following requests from container shipping lines to move to the brand new container terminal at Jebel Ali opened in the third quarter of 2007, most of the containerized cargo handled at Port Rashid has already moved to DP World’s flagship terminal.

Staff and equipment associated with general and non containerized cargo handling will similarly relocate to Jebel Ali by the end of March 2008. Some container handling capacity will remain at Port Rashid and cruise ships and ferries will continue to use Port Rashid as they do currently.

Mr Mohammed Al Muallem senior VP&MD of DP World’s UAE region said that “We have discussed our services with our customers, who are keen to take advantage of our new facility at Jebel Ali. We are therefore making this move to ensure we continue to meet their expanding needs efficiently today and into the future, offering state of the art facilities and services second to none.”

He said that there is also the potential for our customers, and their customers, the shippers, to explore opportunities to improve supply chain efficiencies with the free zone expansion and development of new airport facilities at Jebel Ali, which will be focused on cargo movement. We will work with our customers and business partners over coming weeks and months to ensure a smooth transition to Jebel Ali.

Mr Muallem further added that “These operations may move to add to the thriving business we have at Jebel Ali, but Port Rashid is part of our history and will therefore always be important to us and to our city.”

SABIC to ink pact with Aramco to build a petrochemicals complex

MEED reported that Saudi Basic Industries Corporation is considering a deal with Saudi Aramco to upgrade a Red Sea Coast refinery and a build a petrochemicals complex in Yanbu. It is also believed to be looking closely at the planned Osos Petrochemicals Company polybutylene terepthalate complex.

The estimated USD 500 million plant, which will also have butanediol and maleic production units, may be another good fit for the company as it looks to increase its presence in the speciality chemicals market.

A deal would give SABIC, access to Aramco feedstock and allow the state oil firm to press on with plans to develop its Yanbu project without a foreign partner. Any tie up between the 2 companies would have the blessing of the Saudi government.

The Yanbu venture is one of 3 refinery and petrochemical plants belonging to Aramco. The other 2, Rabigh and Ras Tanura, are JVs with Japan’s Sumitomo Chemical Co Limited and the Dow Chemical Co of the United States.

Aramco announced plans for Yanbu in 2005, including upgrading the 235,000 barrel a day refinery and adding a steam cracker and aromatics complex. It said that “It will almost certainly produce a different range of products to the Rabigh and Ras Tanura complexes to avoid competing with them.”

SABIC, which makes chemicals, fertilizer and steel, in October 2007 posted its fifth consecutive record profit in the third quarter on higher prices for its products and more production.

Iraq picks 3 firms for cement JVs

Iraq has awarded production sharing deals to renovate 3 of its largest state owned cement firms in the first such JV deals with private and foreign investors.

Three Iraqi led consortiums, out of 8 that bid backed by Romanian Uzein Export Import, Lebanon's Seament and Germany's KHD, won the 15 year contract to upgrade the cement factories of Muthana in the southern Samawa region Kirkuk in the north and Al Qaem in the far western Anbar area near the Syrian border. France's Lafarge bid for the fourth plant near the city of Kerbala was rejected after its 12% production sharing offer was considered far too low.

Mr Adel Karem deputy minister of industry & minerals of Iraq said that the 3 firms had accepted production sharing terms of 30% to 45% of their plant's output free of charge to the government after a 3 year rehabilitation plan to bring back capacity to 1.8 million tonnes annually for each plant. He added that every firm would be investing around USD 150 million to revamp their factories, working at 20% capacity due to lack of parts and electricity shortages.

Mr Karem said that the joint venture scheme is a reversal of an earlier US backed policy to pursue an aggressive privatisation that would have offered the 240 public enterprises for sale to foreign investors. These businesses operate with a subsidy and investors would have to keep on a bloated workforce. He added that "This will allow us to proceed ahead with the other cement firms and then move to other industries to allow us to rehabilitate our chemical and fertilizer industries to accelerate reconstruction efforts."

The current Iraqi cement industry's total production, that includes 17 factories, is between 4 to 5 million tonnes annually. Before the 2003 invasion, Iraq produced around 10 million tonnes annually of cement. Currently Iraq imports around 6 million tonnes annually of cement from neighbouring Syria and Lebanon to cover consumption.

Iran’s foreign investment increases in 9months

Mehr News Agency reported that Iran’s foreign investment was on the rise in the March to November 2007 period.

Mr Ahmad Jamali official of economic affairs & finance ministry, while attending the first exhibition on Iran’s investment opportunities on southern Kish Island, said that the strategy of fascinating and encouraging investors is on the government’s agenda. He added that the government is considering facilitating and accelerating the process of attracting foreign investors.

Mr Majid Shayesteh MD of the Kish Free Zone Organization said that Iran has attracted USD 10 billion worth of foreign investment in 2007.

Dubai budget may touch a surplus of AED 11.4 billion

Shaikh Mohammed bin Rashid Al Maktoum VP and prime minister of the UAE has announced the budget of the emirate, which is expected to touch a surplus of AED 11.4 billion compared to AED 5.1 billion in 2007. Dubai's revenues for fiscal year 2008 are expected to touch AED 135 billion, while planned spending is estimated at AED 123.6 billion.

Shaikh Maktoum has also issued Law no 29 for 2007 on budgets of the departments of Dubai government in the year 2008. The budgets are put at AED 26.5 billion, in which expenditure was distributed as per the strategic plan. Salaries and wages totaled 28%, while the administrative and general expenditure were 32%. The developmental and projects accounted for 40 per cent of the budget of the government departments.

According to the financial report, the contribution of oil sector to the projected gross domestic product in 2008 will be 4%. The share of Dubai's public sector in the balance sheet was 21%, while the contribution of the economic sector was 79%. Dubai's non oil sector has scored success in regard to production rate through the emirate's endeavors to expand and diversify revenue sources and base of income.

Mr Sami Dhaen Al Qamzi director general of Dubai Finance Department said that the 2008 budget reflects new dimensions and shows a growing attention is being paid to infrastructure projects as per international standards.

Sindh rejects NEPRA tariff for Thar project

It is reported that Sindh government has rejected Pakistan's National Electric Power Regulatory Authority proposal, which had allowed a 30 year indicative tariff of 7.8 cents per unit for a 1000 MW coal based power project in Thar in Sindh Province and was approved by Mr Mohammadmian Soomro caretaker prime minister of Pakistan.

The Sindh government representatives had proposed an upfront tariff of 11 cents per unit but said a tariff less than 10.5 cents per unit was unacceptable to the provincial government. They took a strong position against the indicative tariff determined by the NEPRA and accused the federal government and its agencies of sabotaging investment prospects in the province.

Sources in the NEPRA and power ministry said that sponsors of the project had themselves offered a tariff of 9.5 cents per unit a couple of weeks ago but the provincial government was now asking for a much higher tariff of 11 cents that did not meet any international standard or the national laws. They said some powerful groups in the provincial government were unnecessarily making a provincial issue of a matter that could be settled on prudent economic principles, and added the heating value of the Thar coal was much inferior to Indonesian coal.

Sources said that the total cost of the project had been estimated at USD 2.5 billion including USD 1.9 billion for coal miningThey said that the NEPRA had offered 7.8 cents per unit tariff by overstretching its mandate on the back of the prime minister's instructions.

Al Qudra and Al Safat plan to launch JV projects

It is reported that Al Qudra Holding has signed a MoU with Al Safat Investments of Kuwait to launch JV projects in the future. Al Safat Investments of Kuwait recently announced a stake 60 million or approximately 10% of the shares of Al Qudra Holding, a deal estimated at AED 600 million.

Mr Salah Salem bin Omeir Al Shamsi chairman of the board & MD of Al Qudra Holding has signed the memorandum on behalf of his company while Al Safat Investments was represented by Mr Walid Ahmed Al Sharhan chairman of the board & MD.

Mr Al Shamsi said that "Our cooperation with Al Safat comes as one of the most important investment agreements we have achieved, in either the public or private sector in and outside the Arab world throughout 2007. Equally important, this partnership will contribute to bolstering bilateral economic relations between two major companies in the GCC." He added that business dealings with the new partner will open doors for further development and broaden the scope of Al Qudra's investments in the region and the world.

China beats South Korea in new ship orders in 2007 on DWT basis

According to data compiled by Clarkson Plc China surpassed South Korea to become the world's biggest shipbuilder by new orders in 2007 as Chinese shipbuilders booked orders for 103.6 million DWT as compared with South Korea's 94.8 million DWT.

However, China remained behind South Korea in new orders measured by compensated gross tonnes.

Deadweight tonnage measures a finished ship's carrying capacity and does not reflect the cost of building a vessel or its sale price. Compensated gross tonnage is a measure that accounts for ship size and the time required and materials used for production.

Shipyards in China booked orders at historically high prices last year, more than tripling order backlogs at the nation's shipyards. Demand for vessels to carry Chinese imports of raw materials and exports of consumer goods is fueling earnings growth at shipbuilders including China State Shipbuilding Co the nations biggest.

Update on Chinese billet export prices

It is reported that Chinese domestic billet prices seem to have recovered in China last week due to high input cost.

Q235 150mm billet in Tangshan was being quoted at CNY 4220 per tonne to CNY 4250 per tonne and 20MnSi grade product was being tagged at CNY 4380 per tonne up by CNY 100 to CNY 120 per tonnes from December. However trading was reported to be quite thin and further surge is unlikely.

Export offers were reported at USD 730 per tonne on FOB basis for Q235 billet and USD 740 to USD 750 per tonne on FOB basis for 20MnSi grade.

High prices are hindering imports in South Korea and S.E Asia. There is strong likelihood that billet exports would stop in 2008 taking into account the current 25% export tax.

Chinese steel imports into EU in 11 months up by 91% YoY

According to European Commission, Europe's steel imports from China almost doubled during the first 11 months of 2007 against the same period in 2006 as it continues to investigate whether China is illegally selling steel at below cost.

The European Union executive office's figures show that China shipped 10.6 million tonnes to Europe from January to November 2007 an increase of 91%. China provided around a third of the EU's steel imports, far ahead of other suppliers in Turkey, India, South Korea and Switzerland.

Overall, EU steel imports for the first 11 months of last year grew 29% to 31.8 million tonnes up from 24.7 million tonnes in 2006.

China's economic growth in 2008 to slow down slightly

According to the report released by Bank of China, China's economic growth is estimated to be 10.5% in 2008, slightly lower than in 2007. The report said inflation pressures would still exist in 2008, but would gradually flatten over the year. It said the Chinese yuan is expected to appreciate faster against the US dollar in the first half of the year compared with the latter half.

It warned the appreciation would have more negative impacts on the profits of export oriented companies and suggested the government should be careful with exchange rate policies to avoid a cooling effect on the domestic economy of a possible decline in exports.

However as per another report issued by the Chinese Academy of Sciences, China's economy would continue to enjoy strong growth, driven by the favorable economic environment. As per this report, China's gross domestic product is projected to reach CNY 27.93 trillion (USD 3.88 trillion) in 2008 up by 10.2% YoY.

However, the report said, the growth would be slowed down by the fluctuating prices of resource commodities in the global and domestic markets, as well as long standing systematic problems of China's economy.

China’s State Information Center had predicted a week ago that China's GDP growth would slow to 10.8% in 2008.

Mr Yao Jingyuan the chief economist of the National Bureau of Statistics recently said that China's GDP is to grow by 11.5% in 2007.

Chinese HR export prices steady

It is reported that Chinese hot rolled steel coil prices witnessed little bit of softening last week, after a jump of CNY 200 per tonne from CNY 4550 per tonne, as market was digesting the rise coupled with pressures of credit tightening.

On Shanghai market, 4.5mm to 5.5mm in1500mm width HRC by Shagang was being offered at CNY 4700 per tonne and transactions were reported to be thin .While those by Tangshan and Rizhao were tagged at CNY 4650 per tonne to CNY 4670 per tonne. 4.75mm to 11.5mm in 1800mm width HRC was offered at CNY 4730 per tonne.

Export offers were largely unchanged at USD 685 per tonne to USD 690 per tonne FOB. Most exports go to South East Asia and Vietnam, where are believed to be following the steps of China on steel market price. Shougang was even reported to be offering at USD 700 per tonne FOB.

Vietnam has been the hottest destination for Chinese HRC exports due to its robust demand. Apart from China, Taiwan, India and even South Korea is shipping HRC to Vietnam for account of its high purchase price.

Chinese auto production and sales in 2007 hit record 8.8 million units

Xinhua reported that auto production and sales in China during 2007 surged by more than 20% to a record 8.8 million units despite slackening sales in global markets beating the prediction of 8.5 million made at the beginning of 2007.

According to the China Association of Automobile Manufacturers, China's automakers rolled out 8.88 million motor vehicles last year up by 22.02% YoY and total vehicle sales jumped by 21.84% YoY to 8.79 million units.

Production of passenger vehicles including sedans, sport utility vehicles and minivans went up by 21.94% YoY to 6.38 million while sales rose by 21.68% YoY to 6.3 million. Output of trucks and buses reached 2.5 million and sales 2.49 million.

Mr Dong Yang vice chairman of China Association of Automobile Manufacturers told Xinhua that both China's auto output and sales would continue to expand at double digit rates in 2008 to 10 million.

Mr Dong said China's car market has huge potential as the economy continues to grow rapidly and the government tries to encourage people to spend money. He said that “Currently, vehicle ownership in China was 44 for every 1,000 people as compared with the world average of 120 and 750 in US.”

Chongqing to lift steel capacity to 8 million tonnes

It is reported that Chongqing City of Sichuan Province based Chongqing Iron & Steel expects to raise its steel production capacity to 8 million tonnes per year by the year 2010 from the current 3.5 million tonnes after its plant relocation to Chongqing Changshou District located 70 kilometers away from its present plant in Chongqing Dadukou District.

The report cited as Chongqing Steel official as saying that "We will expand our steel capacity through uniting with other domestic steel producers in the coming years.”

Chongqing Steel expects its total steel output in 2008 to be 5% to 10% higher than an estimated 3.3 million tonnes produced in 2007.

Chinese FOREX reserve tops USD 1.53 trillion

According to the People's Bank of China China's foreign exchange reserve had reached USD 1.53 trillion by the end of 2007 up by 43.32% from 2006.

China central bank said a total of USD 461.9 billion were added to the country's foreign exchange reserve in 2007.

China's FOREX reserve kept a sharp growth in 2007, reaching USD 1.2 trillion by the end of March, USD 1.33 trillion by the end of June and USD 1.43 trillion by the end of September.

The huge FOREX reserve is considered the main reason for excess liquidity in China, as the central bank has to spend quantities of basic money to purchase foreign exchange, thus aggravating the problem of surplus fluidity.

Sinosteel India inks 3 pellet plant agreement in India

It is reported that Sinosteel India has signed an agreement with three medium sized Indian steelmakers on a pellet mill project.

As per the agreement, Sinosteel India will provide technical designs of three 600,000 tonnes pellet mill and affiliated equipments to the three steelmakers within one year.

This is Sinosteel India's first general contracting project gained by itself after a three month technique exchange and commercial negotiations.

Tangshan Steel facing delays in iron ore supplies from Rio

It is reported that Tangshan Iron & Steel Group has received a notice from Rio Tinto Group stating that delivery of iron ore will be delayed because of a hurricane.

As per report the notice, received by Tangshan Steel this month, didn't say how long it will take to resume normal iron ore deliveries from Australia.

Mr Gervase Greene a spokesman with Rio Tinto in Perth said that “We are on target to fulfill contractual commitments to our long term customers. He said any impact of recent weather events on contracted tons would be discussed directly with our customers.''

Tangshan Steel buys iron ore from Rio Tinto on long term contracts.

Cosco handled 400 million tonnes cargo in 2007

Xinhua reported that by the end of December, Cosco Group's cumulative ocean cargo volume in 2007 reached a record of 400.28 million tonnes, which is also the largest annual cargo volume among Chinese carriers.

As per report Cosco's productivity kept rising last year. In July, the group became one of the world's Fortune 500 companies. In August, its fleet capacity exceeded 50 million tonnes. In November, its core business revenue surpassed CNY 100 billion.

China's 2007 trade surplus jumps nearly 50% to hit new record

According to the China General Administration of Customs, China's trade surplus surged 47.7% over a year earlier to reach a record USD 262.2 billion in 2007. China General Administration of Customs said that in 2007, export rose 25.7% to USD 1.22 trillion and import climbed 20.8% to USD 955.8 billion.

China General Administration of Customs also pointed out the country's soaring trade surplus eased a bit in the fourth quarter last year, with imports catching up and exports slowing down.

China trade surplus for 2006 stood at USD 177.47 billion.

Ukraine sets steel export quota for EU at 1.353 million tonnes

It is reported that the Ukrainian cabinet has set the steel export quota for the European Union at 1.353 million tonnes 2.5% more than in 2007.

On the list of goods, exports and imports of which are to be licensed and quotas for 2008, the SA1 category flat roll in coils export quota was increased from 190,000 tonnes in 2007 to 194,750 tonnes in 2008, the SA2 uncoiled flat roll export quota from 390,000 tonnes to 399,750 tonnes and the SA3 flat roll export quota from 140,000 tonnes in 2007 to 143,500 tonnes.

Death toll at Abaiskaya mine blast rises to 30

KAZINFORM reported that the death toll in ArcelorMittal Temirtau’s Abaiskaya coalmine blast officially rose to 30 as Rescuers have been unable to put out an underground fire at the mine. 7 miners had initially been reported killed in the blast. The ministry said the search for survivors had been abandoned and certain areas of the mine were being filled with water to prevent the flames from spreading.

Mr Vladimir Bozhko emergency minister of Kazakhstan has told a press conference that “Unfortunately, high temperatures and concentration of carbon oxide have made impossible the survival of 23 miners remaining under the ground.”

According to him, before making such a decision the local authorities had a talk with the families and relatives of the victims of the accident. He said “It was an uneasy task. We fully understand grief of the people who lost their sons, fathers and husbands.” Mr Bozhko noted that the search for the bodies would be resumed as soon as possible.

It is reported that Mr LN Mittal president & CEO of ArcelorMittal is to visit Kazakhstan. Mr Umirzak Shukeyev deputy prime minister of Kazakhstan told media that Mr Mittal has been summoned by the government and is expected to arrive on Monday.

Bulgaria, Romania, Ukraine vie for Voest Alpine steel project - Report

Reporter.gr reported that the construction of a new steel complex in Bulgaria is under discussion as it has proved to be more aggressive in attracting investments than Romania and Ukraine despite lacking a large scale port infrastructure.

As per report, Austrian steel major Voest Alpine plans to build a metallurgical plant in Bulgaria, Romania or Ukraine at an investment of EUR 6 billion and EUR 10 billion. The report added that Voest Alpine is considering three possible locations for the new plant in Ukraine and two in Bulgaria; all of them at the Black Sea coast.

The report added that by the middle of 2008, three possible sites will be singled out to be scrutinized and analyzed; it might be that all three of them are in one and the same country.

Ukraine coal production in 2007 down by 6% YoY

Ukraine coal industry ministry said that it has reduced coal production by 6% YoY or by 4.82 million tonnes in 2007 to 75.437 million tonnes.

Production of coking coal fell by 5.8% YoY or 1.749 million tonnes to 28.396 million tonnes and output of steam coal dropped by 6.1% YoY or 3.071 million tonnes to 47.041 million tonnes.

Ukraine raised coal production by 2.8% YoY or 2.22 million tonnes in 2006 to 80.257 million tonnes.

Azovmash to supply ASU’s to NLMK

Ukrainian News reported that Azovmash Company has manufactured a gas unit for supplying oxygen to a converter with capacity of 160 tonnes for the Novolipetsky metallurgical plant.

In 2008 Azovmash will supply two oxygen feeding machines with capacity of 300 tons to the Novolipetsky metallurgical plant and is considering the possibility of manufacturing a teeming ladle car and a slag carriage for it.

Azovmash was founded in 2000 as a management company of the largest producers and developers of railcars and heavy machinery. It comprises of Mariupol heavy machinery factory, Azovzahalmash, the Mariupol thermal factory and the Main Specialized Design and Technological Institute. Azovmash finished 2006 with profits of UAH 2.2 million; it reduced its net revenues by 60.9% or UAH 441.397 million to UAH 283.829 million compared with 2005.

RZD increases cargo shipments in 2007 to 1.495 billion tonnes

Interfax reported that Russian Railways has increased cargo shipments in 2007 by 4.2% YoY to 1.495 billion tonnes. RZD increased shipments within Russia by 2.6% YoY to 978.65 million tonnes and increased international shipments by 7.5% YoY to 515.99 million tonnes.

The details of traffic handled during 2007 are as under

In million tonnes

Property fund to hold auction for 18.5% of Primorsk Port

It is reported that the Property Fund of the Leningrad region will hold an auction on sale of 18.5% of Commercial Seaport Primorsk. The opening price of the block of shares is RUB 300,000.

As per report, commercial Seaport Primorsk was put into operation in 2001. It is operated by Primorsk branch of St Petersburg Port Administration. Primorsk is the final stage of the first phase of Baltic Pipeline System aimed at oil transportation from Timano Pechersk and West Siberia oil and gas provinces as well as from Kazakhstan. In 2006, the ports throughput totaled 66.78.1 million tonnes.

The authorized capital of Commercial Seaport Primorsk makes RUB 100,000 divided into 1,000 of ordinary shares with nominal value of RUB 100 each. As of September 30th 2007, the company's debt to different budgets totaled RUB 471,000, to non budget government funds RUB 21,000.

Belarus sets up body to oversee nuclear plant project

RIA Novosti reported that Belarus has set up a state controlled directorate to oversee a project to build the country's first nuclear power plant.

Mr Mikhail Mikhadyuk deputy energy minister said the body had been set up to organize work before and during the project, develop documents on operating rules, oversee the construction of the nuclear plant, train staff, take on labor and prepare documents for a tender.

Mr Mikhail also said Belarus is busy preparing a construction tender for the plant and that it was a vital issue demanding some time. He said the site for the plant's construction will be selected in 2008 in accordance with international and local laws, as well as the International Atomic Energy Agency's recommendations.

The planned plant, with a capacity of 2,000 MW, would considerably contribute to national energy security, providing electricity equal to that generated from five billion cubic meters of natural gas, at half the cost.

Belarus economy grows by 8.1% in 2007

It is reported that the Belarusian economy slowed to 8.1% in 2007 against almost 10% in 2006 but the growth was within a government target of 8% to 9%.

As per report, Belarus has had to absorb almost a doubling of the price for its gas imports from Russia in 2007. Prices of USD 100 per 1,000 cubic meters of gas hit growth and fired inflation to 12.1% in 2007.