Indian iron ore spot prices dip in last week

China Chamber of Commerce of Metals, Minerals and Chemicals Importers & Exporters has released the average reference prices for import transactions of ferrous 63.5% Indian iron ore concluded last week on February 4th 2008 as under

The change is with reference to that posted on January 28th 2008.

The reference price practice is intended to regulate the domestic trading of Indian iron ore and avoid speculation on the raw material for China's booming steel industry. The China Chamber of Commerce of Metals, Minerals and Chemicals Importers & Exporters are the largest trading association in China.

Global Steel Holdings acquire coking coal license in Mozambique

BS reported that Global Steel Holdings has acquired two coal blocks in Mozambique in an area where ArcelorMittal, TATA Steel and Vale are also present.

The report cited a Global Steel spokesperson confirming that the company has acquired a prospecting license for the blocks and has also been allocated 30,000 hectare of land in the Tete area of Mozambique.

As per report, the two blocks have a proven resource of 70 million tonne of coking coal.

The report added that Global Steel Holdings is expected to invest USD 115 million for developing underground coal mines and develop links to the nearest sea port of Biera, which is about 600km, is proposed to be done through the railway network under restoration now and likely to be operational within a year. Coal production is expected to start in 3 years to 4 years.

Currently, Global Steel operates and manages about 13.8 million tonnes of steelmaking capacity in Bulgaria, Nigeria, Philippines, Libya and India. It also has associated businesses in coke making, ferroalloys, chromite, iron ore mining and energy in Bosnia, Nigeria and India.

Mesco Steel unveils steel plant plans to become major player

BL reported that Mesco Steel Group is planning to invest USD 2.8 billion to expand its existing steel making capacity and set up a Greenfield project in Jajpur district of Orissa. The two projects together are expected to take the total capacity to 6.5 million tonnes per annum. Both these projects are expected to be completed by 2010-11.

Mesco, which owns Mideast Integrated Steel, will enhance its existing pig iron plant into a 3.5 million tonnes per annum steel plant, with an investment of USD 1.2 billion.

Meanwhile, the 3 million tonne Greenfield steel plant, to be spread over 800 acres of land, is likely to be finalized by April 2008. Mesco will invest in USD 1.5 to USD 1.6 billion through JV route for the proposed plant and will be implemented by Mesco Kalinga Steel.

Ms Rita Singh MD of Mesco Steel said “The other USD 1.6 billion would be invested in the other group company Mesco Kalinga Steel Ltd to set up a 3 million tonne Greenfield steel plant in the first phase, which can be expanded later to 5 million tonnes.”

Mesco is also planning to ramp up its pig iron production from 0.4 million tonnes to 0.7 million tonnes by 2008-09. It also plans to increase its iron ore production to around 5 million tonnes to 6 million tonnes by the end of 2008-09 from current levels of 4.2 million tonne.

Burnpur Cement to set up steel plant in Jharkhand

FE reported that Burnpur Cement Limited is all set to diversify and foray into steel manufacturing and has chalked out a plan to invest more than INR 20,000 crore on this.

Mr Ashok Gutgutia vice CMD of Burnpur Cement Limited told FE that “The steel plant will be of 2.5 million tonnes capacity and will be constructed in two phases in Jharkhand. However, we are yet to finalize the blue print and the decision on the same will be taken soon.”

As per report, Burnpur Cement Limited has also formed a separate company in the name of Burnpur Ispat Limited for its new steel business and within a month or two Burnpur Ispat Limited will be applying for the iron ore mines to the Jharkhand government.

Jain Group plans steel plant at Purulia in WB

The Telegraph reported that the Jain group plans to build a 1,000MW power plant and a 5 million tonne steel mill at Raghunathpur in Purulia district of West Bengal.

Mr Manoj Kumar Jain chairman of Jain group said that “We have submitted a detailed project report for these two plants to the Bengal government and we hope to sign a memorandum of understanding within this fiscal. We have already identified the land where the projects will come up and will start land acquisition as soon as we get the government’s approval.

Mr Jain said that the Purulia project will involve an investment of INR 5,000 crore in the first phase. He added that “A Dubai based financial institution has agreed to invest in the steel and power projects.”

Jain group’s wholly owned subsidiary, Jain Steel & Power is also setting up a 0.5 million tonnes integrated steel plant at Jharsuguda in Orissa. He informed that “The construction of the INR 400 crore Orissa project, comprising a sponge iron unit, a power cogeneration plant and a steel billet mill, is almost complete and it will go on stream from March this year.”

Sical building iron ore terminal at Chennai

BL reported that Sical Logistics is building an iron ore terminal at Chennai port and is also in the race for berths in other ports that are opening up for private sector.

Mr Sudhir Ragnekar MD & CEO of Sical Logistics said that “For growth, it is necessary for the company to have a port of its own. Various locations are being considered and the construction of a port will be done by a JV company.”

He added that a MoU has been signed with a major international port for the JV."

Manaksia Q3 2007 net sales up by 31% YoY

It is reported that Manaksia has posted excellent results for the October to December 2007 quarter.

The net sales of the company for the April to December 2007 period has jumped by 31.6% YoY to INR 818.43 crore as against INR 621.62 crore in April to December 2006 period. The profit after tax margin has increased by 39.7% YoY to INR 89.04 crore as against INR 63.75 crore.

Manaksia is setting up a new steel long products facility in Georgia, at a total investment of USD 35 million. The capacity of the new unit, to be located near Poti port, will be 200,000 tonnes per annum and is slated to be completed by June 2009. However the project will be operational in 3 phases starting September 2008. Once fully implemented, the project will generate an EBIDTA margin of over 25% on revenues of USD 140 million at current prices.

Orissa Sponge Q3 loss narrows to INR 22.68 million

Orissa Sponge Iron & Steel has announced that its loss narrowed to INR 22.68 million for October to December 2007 quarter as against a loss of INR 59.08 million in October to December 2006 quarter. Net sales fell by 12.65% YoY to INR 202.47 million as against INR 231.79.

Total income for the October to December 2007 quarter also fell by 10.70% YoY to INR 207.80 million as against INR 232.70 million in October to December 2006 quarter.

Villagers ask for more money for land from Brahmani River Pellets

SNS reported that, in a bid to resolve the deadlock between Brahmani River Pellets Limited and residents of Khurunti village over the issue of displacement, the district authorities held talks with the agitating villagers. A decision to organize the meeting to interact with the agitating villagers on the displacement issue was taken after the villagers stopped the construction of the boundary wall of the BRPL a few days ago.

It is noted that the agitating villagers did not even allow the company to conduct contour survey on the earmarked lands, allotted in the company’s favor by the state government, demanding higher compensation as per the new Rehabilitation & Resettlement policy.

The report cited Mr Dibakar Nayak head of the village as saying that “We were paid less compensation by the government. Our demand is to compensate us as per the new R&R packages, formulated by the state government in 2006. We will not allow construction activities of the company unless our demand is fulfilled.”

Mr Srikanta Kar GM of Brahmani River Pellets Limited said that "Accordingly, a fresh enumeration will start on war footing basis to resolve the issue. The villagers are demanding more compensation. However, IDCO has provided the required land to the company. So the problems lie with the district administration, not with us.”

Brahmani River Pellets Limited had inked a MoU with the state government in March 2007 to set up 2 iron ore pellet complexes in Keonjhar and Jajpur with an investment of INR 1,485 crore. Brahmani River Pellets Limited plans to set up a 4 million tonne per annum iron ore pellet plant in Kalinga Nagar. Orissa Industrial Infrastructure Development Corporation has provided the required 90 acres of land to the Brahmani River Pellets Limited in Khurunti village in the industrial complex area.

PSA to acquire 49% stake in ABG Infralogistics

ET reported that Port of Singapore Authority's subsidiary PSA India Pte has agreed to acquire a 49% stake in ABG Kolkata Container Terminal from ABG Infralogistics for INR 150 crore.

The funds are expected to be used for ABG Infralogistics' expansion projects, which include INR 300 crore investments in its crane manufacturing capacity and up to INR 2,000 crore investments in the port sector.

Separately, PSA India has also agreed to subscribe to the preference shares of ABG Kandla Container Terminal, which is another subsidiary of ABG Infralogistics.

ABG Infralogistic currently operates the Kolkata container terminal under a unique own operate maintain contract since April 2005, and has handled 170,000 TEUs during 2006-07 and hopes to handle over 200,000 TEUs during 2007-08.

L&T emerges as highest bidder for Seawoods station project

Projects Today reported that Larsen & Toubro has emerged as the highest bidder at INR 1,809 crore for the development of an integrated commercial complex at its Seawoods railway station in Navi Mumbai. L&T outbid DLF Retail Developers and Indiabulls Real Estate for the proposed project.

The state of the art complex, to be spread over 16.2 hectare of land will include space for commercial, shopping, offices, multiplexes and hotels. Along with an integrated complex, an iconic railway station building will also be built by the successful bidder, with an estimated investment of around INR 35 crore.

SSL Energy may set up steel and power plant at Balasore

SNS reported that Balasore district in Orissa is hoping to get a new steel plant and is making efforts to set up at least one medium or large scale industry as so far it has failed to attract investors despite its good infrastructure.

As per report, SSL Energy is proposing to set up a steel plant with 3 million tonnes capacity per annum with an investment of about INR 10,000 crore. It further expects to set up an integrated captive power plant of 210 MW.

The report added that the final picture would become clear during the visit of the company’s officials scheduled on February 10th and February 11th 2008.

Mr Sambit Nayak sadar tehsildar of Balasore said that “The technical team of the company has shown a keen interest. As of now, we awaiting the final say.

He added that the district has identified nearly 2,100 acres of private land in Inchudi, Tundra, Talapada and Srijang. The company would have to acquire 1,000 acres more for the construction of a railway link up to Khanatapara station and a road for connecting to NH-60. He added that "SSL Energy desires to have nearly 3,000 acres under the present identification scheme and about 90 families comprising 440 members would be displaced."

Cement makers to appeal against MRTPC order

It is reported that a majority of the 44 cement companies, recently accused of cartelization by the Monopolies & Restrictive Trade Practices Commission, and are in the process of filing an appeal against the commission’s order at a higher court.

The report cited a cement company official as saying that “We have sought legal opinion from experts and are in the process of filing an appeal at the Supreme Court against the MRTPC order. MRTPC’s findings are baseless and we need to establish that.”

It may be noted that MRTPC found 44 cement companies, including giants like Birla Cement, Grasim, ACC, Jaiprakash Associates and JK Lakshmi, guilty of cartelisation under the aegis of the Cement Manufacturers’ Association between February and April 1990.

The commission had begun inquiries in October 1990, after its investigative wing director general of investigation & registration, had alleged that the cement companies were involved in cartelization. It also agreed with the report of DGIR that stated the prices were determined by CMA in different states on the basis of prevailing market conditions through the local management of manufacturers.

In its order on December 20th 2007, MRTPC has warned the cement producers and CMA not to repeat such a practice. The companies have also been directed by the commission to file an affidavit of compliance within 8 weeks.

GVK Power’s 7 subsidiaries become wholly owned

It is reported that 7 subsidiaries of GVK Power & Infrastructure Limited have become its wholly owned subsidiaries with effect from February 1st 2008. These subsidiaries include

1) Alakananda Hydro Power Company Ltd
2) GVK Power Company Private Limited
3) GVK Coal Company Private Limited
4) GVK Airport Developers Private Limited
5) Goriganga Hydro Power Private Limited
6) GVK Aviation Private Limited
7) GVK Infratech Private Limited

GVK PIL had earlier announced restructure of its operations and announced its intent to serve as a holding company.

MPSEZ to set up car zones at Mundra Port

BS reported that Mundra Port & Special Economic Zone has entered into an agreement with Maruti Suzuki India Limited to set up an exclusive zone for Maruti cars at Mudra Port in Gujarat.

Mr Sandeep Mehta CEO of MPSEZ said that the bay, which will be ready by early 2009, is intended to help Maruti Suzuki export up to 250,000 cars per year. He added that the car storage capacity would be increased to 400,000 by 2010 to accommodate cars of other companies.

Mr Rajeev Sinha director of MPSEZ had said earlier that the company is developing 50 acre land for car storage with the additional facility of remotely guiding cars into carriers on berth without the help of drivers. Although the company has entered into an exclusive agreement with MSIL, MPSEZ would later be open to entering into similar agreements with other car manufacturers.

The total cargo capacity of MPSEZ would also be increased from 30 million tonnes to 50 million tonnes by 2010 and further to 120 million tonnes by 2015. It would also construct a coal terminal of 35 million tonnes capacity by 2010 at the port.

BHPB bid for Rio - Rio Tinto rejects revised offer

Rio Tinto has made an announcement rejecting the revised offer from BHPB.

A release said that “The boards of Rio Tinto have given careful consideration to BHP Billiton's pre conditional offers to acquire the whole of the issued share capital of Rio Tinto plc and Rio Tinto Limited. Under this proposal each Rio Tinto share would be exchanged for 3.4 BHP Billiton shares.”

It said “The boards have concluded that the pre conditional offers significantly undervalue Rio Tinto. Accordingly the boards have unanimously rejected BHP Billiton's pre conditional offers as not being in the best interests of shareholders.”

Mr Paul Skinner chairman of Rio Tinto's said "BHP Billiton's offers, while improved, still fail to recognize the underlying value of Rio Tinto's quality assets and prospects. Our plans are unchanged, and will remain so unless a proposal is made that fully reflects the value of Rio Tinto. Accordingly we are forging ahead with our strategy of operating and developing large scale, long life, low cost assets to generate significant value for shareholders".

Mr Tom Albanese said CEO of Rio Tinto said "Rio Tinto has an exceptional portfolio of assets and significant stand alone growth opportunities, particularly in iron ore, copper and aluminum. These assets and opportunities, combined with the company's strong track record for value delivery, project execution and successful exploration means Rio Tinto is very well positioned to take advantage of strong global markets and the growth in the resources industry, maximizing value for shareholders."

AK Steel eying Sparrows Point

The (Baltimore) Sun reported that AK Steel Holding Corp is taking a look at the Sparrows Point steel mill near Baltimore in UK

Mr John Cirri, president of United Steelworkers Local 9477, which represents 2,100 Sparrows Point workers, said in an e mailed memo Monday that AK Steel was visiting the plant.

In another memo Thursday, Mr Cirri said the court appointed trustee overseeing the divestiture would accept bids until mid February and hopes to complete a sale three months after selecting a winning bid.

The trustee, Washington lawyer Joseph G. Krauss, said last month that he has retained investment bank Morgan Stanley to review the bids.

The plant has not attracted many suitors from the United States. Most of the companies that previously bid were from Latin America and Europe. A bid by AK Steel of West Chester, Ohio, would mark the emergence of a second US steelmaker interested in acquiring the Sparrows Point complex, which Mittal Steel Co NV must sell to settle antitrust issues. Illinois based Esmark Inc, which failed to complete a USD 1.35 billion purchase of Sparrows Point last year, has said it expects to bid again.

BHPB bid for Rio – Eurofer to oppose merger

FT reported that European steelmakers are gearing up to fight BHP Billiton’s attempts to take over Rio Tinto.

As per report, European Confederation of Iron and Steel Industries said that it has already prepared a preliminary file detailing its concerns for the European Commission’s competition department and held an exploratory meeting with a commission team to look at issues raised by the combination.

The report added that one of Eurofer’s main concerns is that, if the merger went through, about 80%t of the world seaborne trade in iron ore would be in the hands of two rather than three companies, which it claims would have implications for pricing power.

Acindar workers strike after accident

Dow Jones reported that workers at a steel plant operated by ArcelorMittal's Argentine unit Acindar were expected later Wednesday to end a 24 hour walkout that union leaders announced following an explosion that injured eight steelworkers.

The explosion, at an Acindar plant in the province of Santa Fe, occurred Tuesday during oven maintenance. Union leaders were widely quoted as telling Argentine media that the walkout would end Wednesday afternoon.

Last week, ArcelorMittal announced that it successfully bought back the 35% stake in Acindar that it didn't already own.

Corus Tubes hikes price for cold formed hollow section

Corus Tubes has announced a price increase of GBP 50 per tonne for its Hybox 355 cold formed hollow sections from the end of the first quarter.

The release said that “The price increase has become necessary due to the rapidly increasing steel production costs, principally resulting from higher raw material prices affecting much of the industry.”

It added that further price increases are expected to follow in the second quarter of 2008.

Corus Tubes is a leading manufacturer of hot finished and cold formed welded steel tubes used in the construction, engineering, energy, automotive and precision tubing markets. The product range includes structural hollow sections, large diameter pipe, precision tubes, cold drawn tubes and coated tubes. Employing 2,300 people across 4 countries, Corus Tubes has 10 manufacturing sites and sales offices in the UK at Corby, Hartlepool, Halesowen, in the Netherlands at Zwijndrecht, Arnhem, Oosterhout, Maastricht, Belgium and Poland.

RBCT January coal exports decline by 10%

Bloomberg reported that South Africa's Richards Bay Coal Terminal, the world's biggest coal export facility, shipped 10% less of coal in January 2008 after rail maintenance slashed stockpiles.

RBCT said that it transported 3.57 million tonnes of coal in January 2008 as compared to 3.98 million tonnes in January 2007 and 6.77 million tonnes in December 2007.

According to McCloskey Group Ltd, production in South Africa has been affected by power cuts and rain. The port has received 5.08 million tonnes of coal by rail in January and as of January 31st 2008 had stocks of 2.64 million tonnes against a target of between 3 million tonnes and 4 million tonnes. That represents a rise from the about 1.18 million tonnes in stock at the end of December.

Richards Bay Coal is owned by South Africa's biggest coal exporters, including Anglo American Plc, BHP Billiton Ltd and Xstrata Plc.

Thep Viet Steel orders for a new bar mill

Siemens Metals Technologies has received an order from Thep Viet Steel Co Ltd of Vietnam to equip a new bar mill at the company's Ba Ria facility in Vietnam. The new plant will have an annual capacity of 450,000 tonnes. The new bar mill is scheduled to start production in the middle of 2009.

The project includes supply of the mechanical components as well as the electrical and automation systems. For the new plant, Siemens is supplying the mechanical equipment. This includes a reheating furnace for the steel billets, 19 rolling stands, a 78 meter long cooling section as well as cutting and handling machines. The electrical equipment as well as the basic and process automation systems are also part of the scope of supply. Apart from this, Siemens is providing consulting services for construction and commissioning of the new plant.

Thep Viet Steel Corporation is a leading producer of structural steel in Vietnam. It is building a new bar mill in Ba Ria-Vung Tau province in the south east part of the country. Thep Viet Steel already has a bar and wire rod mill at its subsidiary, Pomina Steel Co Ltd in Binh Duong province, which was also equipped by Siemens Metals Technologies.

Queensland flood impact on coking coal is significant

BHP Billiton said flooding has had a large impact on its coal operations in Queensland. The company has also given a bleak outlook on the power situation in South Africa. Last month, heavy rain in central Queensland forced the closure of a number of coal operations.

Mr Marius Kloppers CEO of BHP Billiton in Sidney has told analysts that "The impact has been large.”

Mr Marcus Randolph BHP Billiton executive of ferrous and coal said that the company would lose something about two weeks of production. Elsewhere, electricity shortages in South Africa have disrupted diverse operations there by a number of miners.

Meanwhile, Mr Kloppers reiterated the company's view that demand for commodities would remain strong in the long term despite the recent credit crisis. He added that "Our outlook for long term demand is absolutely unchanged. Fundamentals for iron ore, metallurgical coal and manganese key steel making products remained strong. He added that "If anything, the fundamentals for manganese and coking coal look better than iron ore.”

BHPB bid for Rio - Fitch places Rio on Rating Watch Positive

It is reported that Fitch Ratings has placed the ratings of UK based Rio Tinto Plc and Australia based Rio Tinto Ltd, collectively the Rio Tinto Group, on Rating Watch Positive following the announcement by BHP Billiton of a USD147.4 billion offer for the group.

The affected RT group ratings are as follows:
1. Rio Tinto: Long term Issuer Default rating 'A-' (A minus) on RWP
2. RT: Short-term IDR 'F2' on RWP
3. RT: Senior unsecured rating 'A-' (A minus) on RWP
4. Alcan Inc: Senior unsecured rating: 'A-' (A minus) on RWP

The Rating Watch Positive reflects the share based nature of the transaction and the increased operational scale and commodity diversification that the combined group will benefit from.

Fitch noted that “Both companies' portfolios are predominantly composed of high quality, long life operations with generally lower quartile cost positions. A combination of the two companies will also provide leading market positions in several commodities and the potential for a stronger bargaining pricing position relative to end users. Regulatory clearance, however, may be challenging as a result of the latter. Fitch also considers the merger to offer good potential for cost reduction and other synergy benefits.”

Fitch estimates combined FYE07 adjusted net debt to operating EBITDAR for the pro forma group of 1.3x, which is stronger than for Rio Tinto on a stand-alone basis. Pro forma net leverage could increase to over 2x, should the share buy back proceed. Whilst Fitch believes that base metals prices have peaked in 2007, they are expected to remain at historically high levels over the next 12 months, which, combined with a strong outlook for steel making raw materials, should support the combined group's cash flows over the next 12 months to
18 months.

However, Fitch believes there is a strong possibility that BHP may need to increase its offer to complete the transaction. With any offer premium likely to be debt funded, the likelihood of an affirmation of Rio Tinto's ratings at the current level is increased.

Nisshin Steel plans more share buybacks

Reuters reported that Japan’s Nisshin Steel Co plans more buybacks of its own shares to boost shareholder returns.

Mr Hideo Suzuki CEO of Nisshin told Reuters “We aim to hold up to 10% of our own shares as treasury stock, up from the current 9% percent.’ He did not state a timeframe.

Mr Suzuki said that supply and demand conditions had improved in the global nickel market and that he expected the market to stay balanced until at least 2011. He added that Nisshin Steel is considering using the current nickel price of USD 12 to USD 13 per pound as its assumed price in the next business year.

A plunge in Japanese housing starts triggered by the implementation of tighter building rules in Japan has hurt Nisshin Steel, a big producer of construction steel and household stainless steel products.

Mr Suzuki said the effects of the revised building code would come into full force in the first half of the business year starting in April.

PT Inco beats nickel production target

Metals Insider reported that Indonesian nickel producer PT International Nickel Indonesia Tbk annual production of nickel in matte in 2007 was approximately 169 million pounds which exceeded the original target of 165 million pounds.

The company said it is in talks with the Indonesian Department of Energy and Mineral Resources to build a 22,000 tonne per year high pressure acid leach facility at its existing processing site in Sorowako.

Cotton & Western may sell 50% of iron ore at spot price

It is reported that Cotton & Western Mining Inc may sell as much as 50% of the Baja California iron ore production at spot prices, which are currently at record highs.

Mr Robert L Cotton president & CEO of Cotton & Western Mining said that it is expecting to get at minimum 6 months production from its Baja California new iron ore production and is negotiating with its investment partner to guarantee only 50% of the estimated 150,000 dry metric ton per month production. He added that this would free up one Panamax shipment per month for spot sales which is expected to be between USD 180 to USD 190 a ton, rather than the USD 62 a ton paid under FOB fixed price annual contract.

Rautaruukki wins dispute about use of name Ruukki

In its decision issued on February 5th 2008, the Market Court dismissed all claims by Ruukki Group Oyj.

Ruukki Group had demanded that the Market Court prohibit Rautaruukki, under penalty payment, from using just the name Ruukki as a marketing name.

The Market Court stated that Ruukki Group has no grounds to prohibit Rautaruukki from using the name Ruukki in corporate communications and marketing. Furthermore, the Market Court also ordered Ruukki Group to compensate Rautaruukki's legal costs.

Both Helsinki Court of Appeal and Helsinki District Court had already dismissed claims by Ruukki Group Oyj in the dispute concerning use of the name Ruukki.

CSI reports 2007 results

California Steel Industries, Inc announced net sales of USD 1.28 billion for the year ended December 31st 2007 down by 6% YoY from 2006, resulting in a net loss for the year of USD 906,000.

EBITDA for the year was USD 37.5 million, substantially lower than 2006's USD 213.8 million. For the quarter, EBITDA was negative USD 12.5 million, down from fourth quarter 2006's level of USD 22.0 million

Shipments for the year totaled 1.73 million net tons, 10% lower than 2006. During the quarter, the company shipped 413,143 net tons, slightly higher than fourth quarter 2006. Volume by product is as follows:

Sales volumes in net tons

Its average sales price decreased by 9% during fourth quarter 2007 compared to fourth quarter 2006, and decreased by 6% when compared to third quarter 2007. The average sales price for the year was about equal to 2006.

Mr Masakazu Kurushima president & CEO of said that "2007 was a difficult year for California Steel, and is a strong example of the highly cyclical nature of the steel industry. In 2006, we realized some of the best results in our company's history. This past year, we faced extremely tight margins, given the economic conditions driving demand and pricing here in the United States, while competing in a robust slab market worldwide.”

Bolivia to announce Vinto investment

BNamericas reported Bolivia's President Mr Evo Morales is expected to announce the signing of an agreement to install a new furnace at the Vinto metallurgical complex in Oruro later this week.

A spokesperson from Bolivia's mining and metallurgy ministry told BNamericas that "It will take nearly 18 months to install the new equipment, which calls for a USD 15 million investment.”

He added that the steps necessary to gain the respective permits are already in motion. The investment is part of a technological support agreement with the Venezuelan government.

The announcement will come almost exactly a year after the plant was seized on February 9th 2007 by the Bolivian government from previous owners Sinchi Wayra, the Bolivian subsidiary of Glencore. Following the nationalization production has fallen by about 20%.

Taiwanese domestic HR market heading north

YIEH reported the hot rolled coil market in Taiwan is entering a white heat where the price is rocketing and supply is restrained by certain stock holders.

The spot price has soared to TWD 23,500 from TWD 23,000 per ton before Chinese New Year holidays. However, even the new offer is hiked, suppliers still don’t want to sell out their available stocks which caused the downstream mills no chance to get the availability.

The market anticipators commented that the above price increase is mainly from the advantage of reduced supply and tight availability due to China’s snow storm.

Vale Goro nickel output to start by November 2008

Reuters reported that Vale’s Goro nickel project in New Caledonia could begin production in late October or early November of this year.

Mr Cory McPhee a spokesman of Vale Inco said that the development costs are still expected at USD 3.2 billion. He added that "First commercial deliveries are expected in the first three months of 2009.”

Raytec acquires additional large iron ore property

British Columbia based Raytec Metals Corp announced that, subject to regulatory approval, it has signed an agreement to purchase a 100% interest in the TB3012585 group mineral claims, known as the Gunflint property, located in Jean Township, within the Thunder Bay Mining District in Ontario.

The Gunflint property consist of 16 claim units totaling approximately 640 acres and is located in close proximity to both existing roads and the city of Thunder Bay in Ontario. Reference to a report filed with the Ontario Department of Mines, Mineral Circular No. 11 on Iron Deposits of Ontario, authored by Mr RS Shklanka, which references an estimated deposit of 270 million tons averaging 26.29% Fe (Iron). The same report also indicates samples from surface with 34.1% and 33.9% Fe.

Terms of the acquisition include the payment to the vendors of USD 250,000 with USD 10,000 due upon signing and the balance payable in equal installments prior to January 1st 2012, and the issuance of 300,000 shares with 50,000 issuable on TSX Venture Exchange approval and the balance payable in equal installments prior to January 1, 2013. The agreement is subject to a 3% Net Smelter Royalty of which 2% can be purchased from the vendor, leaving the vendor with a 1% NSR. A finders fee will be payable on this acquisition in accordance with TSX Venture Exchange policy.

According to Mr Brian Thurston president of Raytec "We are very excited about this project, with current spot prices near USD 190 per ton for Iron. Not only does this project involve a large historic resource, which we plan to prove up to modern reporting standards, but the project carries the additional benefit of being very close to deep water port facilities at Thunder Bay.”

He added that they intends to commence a work program as soon as possible in order to verify sample data, prepare for a winter/spring drill program, and to complete a NI43-101 compliant report.

Cuba to modernize railway network

It is reported that Cuba plans to modernize its rundown railway system by investing USD 500 million in Chinese locomotives and Iranian rolling stock.

Mr Jorge Luis Sierra transport minister of Cuba said that we will buy 100 locomotives from China and 550 freight cars and 200 passenger coaches from Iran. He added that "We are determined to change the image of delays and inefficiency that the railway system has in our country."

He said that the new rolling stock would arrive in 2009 and 2010.

Cuba has spent more than USD 1 billion over the last three years to overhaul its transport system. Hundreds of imported Chinese buses have improved services between Cuban cities.

Grange appoints Mr Clark as new MD & CEO

Grange Resources Ltd announced the appointment of an experienced mining professional, Mr Russell Clark as the Company's new MD & CEO effective from March 6th 2008. He is currently Regional Group Executive of Newmont Asia Pacific's Australian and New Zealand's gold mines.

Mr Clark holds a Mining Engineering degree from the Royal School of Mines London and a Graduate Diploma from the Securities Institute of Australia. In addition he has undertaken a number of Executive Development programs in Australia and the USA.

Mr Anthony Bohnenn non executive chairman of Grange said that Mr Clark's appointment was timely as the Company moves its Southdown Magnetite project to the next step of development, with most technical work completed and with final environmental and permitting approvals for the project expected from the WA Government this year. He added that "I am delighted that we have managed to attract someone of the caliber and experience of Russell Clark.”

Mr Clark said that "Grange Resources is at an exciting point in its history. I am looking forward to the challenge of leading the Company through the transition from a junior iron ore company into a world class DR pellet producer. We have the potential to be an important player in the iron ore industry feeding the growing demand in the rapidly expanding DRI based steel making industry in South East Asia and the Middle East."

CME bid would not effect planned steel futures of NYMEX

Reuters reported that a proposal by CME Group Inc to buy the New York Mercantile Exchange should not effect the decision to launch a steel futures contract.

Mr Robert Levin senior vice president at research at NYMEX told Reuters that "It should not affect our decision to move into steel. We are moving forward with steel."

But Mr Levin declined to provide a date for the launch. He said that "It did not harm us that we did not launch last year.”

The exchange had said it planned to launch its contracts, based on the SteelBenchmarker index of World Steel Dynamics, last year. In December, a NYMEX executive told Reuters the contracts could be launched in the first quarter of this year and they were close to make an announcement on the issue. The expected contract will be USA hot rolled band steel futures and will be cleared on the NYMEX ClearPort system.

The world's largest derivatives exchange CME Group hopes to broaden its reach by buying the energy and precious metals exchange for USD 11 billion.

Japanese small bar output in 2007 up by 1% YoY

JMB reported that Japanese small steel bar output decreased by 1% YoY to 11.97 million tonnes in 2007 from 2006.

As per report Kyoei Steel increased the output by 90,000 tonnes to 1.45 million tonnes expanding the share by 0.9 points to 12.2%. The top maker is expected to decrease the output and share in 2008 due to output reduction at Nagoya and Hirakata plants.

Vinalines to build 9 seaports in 2008

Mr Mai Van Phuc general director of Vinalines said the Vietnam National Shipping Line will start the construction of 11 projects, including 9 seaport projects.

These are the constructions of Van Phong international port, the first phase of Hai Phong international port, and a new port in Hiep Phuong to prepare for the transfer from Nha Rong and Khanh Hoi Ports.

Vinaline has also established a yard to repair ships in Ba Ria Vung Tau, Quang Ninh provinces and Hai Phong City. At present, businesses must spend USD 100 million per year sending ships abroad to be repaired because the country is short of yards capable of repairing ships.

Vinalines spent a staggering USD 630 million on 30 new ships last year a record for the corporation. It is targeting VND 17 trillion in earnings this year a YoY increase of 16%.

Bristol to become one of UK's largest port

It is reported that Bristol will be transformed into one of Britain's largest ports by 2011 if a public inquiry later this year gives the green light for work to get under way.

As per report the Bristol Port Company's planned deep sea container terminal that will offer the largest container ships alternatives to strained facilities at Felixstowe and Southampton and at the same time give easy access to the important container market in the Midlands.

Big retailers and other distributors are already planning for success at the docks as massive new warehouse facilities at Avonmouth have been snapped up over the last year.

Bristol based drinks retailer Constellation has just signed a lease on a new 869,000 square feet Avonmouth site currently under construction.

Turkey shuts Bosporus and Dardanelles Straits due to fog

Bloomberg reported that Turkey has shut the Bosporus and Dardanelles straits because of fog, temporarily closing a key export route for Russian and Caspian crude oil. The report added that both straits, on opposite ends of the Sea of Marmara, have been closed to tanker traffic since yesterday.

The Bosporus, which bisects Istanbul, was open to northbound traffic to the Black Sea briefly yesterday, before being completely shut at 7 PM local time, according to an Istanbul based official. It is unclear when it would open.

The Dardanelles have been closed in both directions since early yesterday, according to an official in Canakkale.

The Bosporus and Dardanelles provide the only maritime access for Black Sea and Caspian countries to the Mediterranean. Delays through the channels reduce the supply of vessels and raise freight costs.

Iran nears self sufficiency in steel production - Report

IRNA quoted Mr Ali Akbar Mehrabian minister of industries & mines of Iran as saying that, by increasing the annual steel output to 18 million tonnes in 2008, Iran will become self sufficient in this sector.

Mr Mehrabian during his visit to Hormozgan Steel Complex said that “The ministry has developed eight projects to be implemented in different parts of the country. By putting the projects into operation, the country will be able to export its steel surplus in 2009.”

Announcing there is no limitation for taking advantage of foreign technologies in the industry he said that “Most of the steel industry’s required equipment and requirements are currently supplied by domestic providers.”

Zamil Steel starts production at new unit at Pune

Trade Arabia News Service reported that Zamil Steel Industries has started trial production at its new factory located at Pune in Maharashtra state of India. The state of the art manufacturing facility on a total area of 87,000 square meters is capable of producing complete pre engineered buildings.

The factory is expected to reach its full production capacity in the second half of 2008 when it will have an annual production capacity of 3 million square meters of pre engineered steel buildings.

Mr Adnan Al Mansour, president of Zamil Steel said that “India is one of our key strategic countries and this new production facility is an integral part of our investment approach for success in the dynamic and growing Indian marketplace. We consider India is a major market with high growth potential, and in order to better serve the whole country we will divide it into four regions – North, West, South, and East, and this new factory is intended to serve exclusively the Indian market.”

Kuwait to build USD 77 billion City of Silk

Gulf Daily News reported that Kuwait is planning to build a major city inspired by the Silk Road with a total investment of USD 77 billion, that it hopes will become a global trade and tourist attraction. According to Kuwaiti officials, the City of Silk aims to revive the ancient trade route by becoming a major free trade zone linking central Asia with Europe.

The city will consist of four major zones
1. City of commerce
2. City of leisure and recreation
3. City of ecology
4. City of diplomacy and education.

The city, located in Subbiya on the northernmost tip of Kuwait Bay hard by the Iraqi border, will be home to 750,000 people when completed in 2030. The City of Silk will be linked to the capital Kuwait City by a 26 kilometer causeway, greatly reducing the current road distance of some 120 kilometers. Two artificial islands will be built alongside the causeway.

Khorassan Steel to expand capacity to 1.8 million tonnes

IRNA reported that Khorassan Steel will produce as much as 1.8 million tonnes of steel per year once its 4 expansion projects are completed.

Mr Latif Dasht-Bozorgi MD of Khorassan Steel told Deputy Minister of Industries and Mines that presently his company runs with the capacity of 570,000 tonne per year. He added that the increase in the output a periphery unit with the 800,000 tonnes per year capacity is in stage of construction at EUR 103 million investments.

He added that the project has so far achieved 42% progress and will be completed by March 20th 2009 marking end of the next Iranian calendar year of 1387.

Saudi Electricity invites RFQ for Rabigh power project

Saudi Electricity Company has issued a request for qualification from interested parties to build, own and operate the new independent power plant planned for Rabigh. Statements of qualification have to be presented by February 18th 2008. Some 45 companies and consortia previously submitted expressions of interest for the project.

The facility will have a capacity of 1200 MW and will be felled by heavy fuel oil. It is to be located a few kilometers south of SEC's existing Rabigh power plant.

The project company will sell electricity to SEC under a power purchase agreement, while SEC will supply the fuel oil. Citigroup is the financial consultant for the project and Germany's Fichtner is acting as technical advisor.

SEC is working on plans for three independent power plants in total. The second scheme is for a 2000 MW facility to be built at a Greenfield site west of Riyadh. Details of the third project have yet to be revealed.

Ihlas Holdings, Tanami Holding and Azmeel ink MoU for JV

Today's Zaman reported that İhlas Holding has signed a MoU with 2 Saudi companies namely Tanami Holding and Azmeel International, which will collaborate in housing, industrial construction, petrochemicals, energy generation and steel industry projects in Saudi Arabia.

Under the MoU, a new managing company will be established and İhlas Holding, Tanami Holding and Ameel International will have a 33.33% share each.

İhlas officials said that "The amount of the paid in capital of the company will be decided by the counterparts later and the new company will be run by a three member board, with one representative from each company."

ADPC and HSBC sign AED 459 million credit facility

Abu Dhabi Ports Company and HSBC have signed a one year revolving credit facility of AED 459 million. Mr Ahmed Al Calily CEO & MD of ADPC and Mr Youssef Nasr CEO of HSBC Middle East has signed the agreement in Abu Dhabi.

The arrangement is the second bridge facility arranged for ADPC to meet the initial construction costs of Khalifa Port.

ADPC appointed HSBC in July 2007, to provide financial advisory services to Abu Dhabi's Khalifa Port & Industrial Zone project.

Quality Energy plans mega oil refinery in UAE

It is reported that Quality Energy Petro Holding International Limited is planning to build a USD 13 billion oil refinery in the United Arab Emirates.

The 500,000 barrel a day refinery will be a JV with the government of Russia's Chelyabinsk region, in which Quality Energy plans to invest USD 100 billion between now and 2012.

Mr Adil Al Otaiba chairman of Quality Energy said that "The Chelyabinsk government is negotiating with the Iranian government to provide the crude for the UAE refinery." He added that Quality Energy is in talks with the rulers of one of the UAE's northern emirates about building the plant, without giving a date for the start of construction.

Quality Energy will begin construction on a USD 4.5 billion refinery in Chelyabinsk in 2009, once the Chelyabinsk government has concluded talks with oil companies such as Itera Holding Limited, Rosneft Oil Co and OAO Lukoil to secure 1 million tonnes a year of crude.

NIDC and IOEC strike deal for 3 onshore derricks

Mehr News Agency reported that National Iranian Drilling Company and Iranian Offshore Engineering and Construction Co have signed a contract for construction of 3 onshore derricks. IOEC has undertaken to carry out the EUR 27million contract within 18 months as of today.

Mr Heidar Bahmani MD of NIDC said that “IOEC is a well equipped company enjoying highly experienced manpower.” He added that renting each onshore and offshore derricks cost USD 60,000 and USD 200,000 per day, respectively. Constructing the derricks inside the country saves USD 700 to USD 800 million dollars a year.

IOEC has eyes for signing another contract for building 15 derricks.

Iranian non oil exports hit USD 9 billion in 9 months

During April to December 2007 period, Iran exported USD 8.994 billion worth of industrial goods and minerals up by 10.5% YoY in terms of weight and 12.8% YoY in terms of value against the figures in April to December 2006 period.

During the period, minerals and industrial goods accounted for 78.5% of the total non oil exports which were mainly exported to the UAE, Iraq, China, Japan and India.

China to finalize steel export qualification scheme soon

Mr Luo Bingsheng deputy director of the China Iron & Steel Association while speaking at an industrial conference said that Beijing is in the process of drawing up details for qualified steel exporters.

Mr Luo said in order to cool down rampant steel export growth the authority believes it's necessary to go for measures like reducing tax rebate and levying an export duty. Moreover, some sort of administrative restrictions like a qualification scheme for steel exporters might do some help.

He said that "We believe the standards would help regularize the steel export market and activities of steel exporters as well. CISA has already submitted its proposal to the central government and obtained affirmative response. The regulations would involve both steel producers and traders.”

China's finished steel export rises 45.67%YoY to 62.65 million tonnes last year, while its billet export falls 28.88% from the previous year to 6.43 million tonnes. Steel imports amount to 16.87 million tonnes down by 8.86%YoY, billet import record a YoY drop of 34.64% to 242,100 tonnes.

Year of Mouse likely to see losses

Shanghai Daily reported that Chinese astrologer Mr Tony Tan, a former broker at DBS Securities, is predicting losses in the Year of the Mouse. He said "Just like a rat, investors will have to be nimble. It is going to be a highly competitive year."

This year the Mouse, a "water" creature, combines with the "earth" cycle, another unstable combination according to Mr Tan.

Mr Tan expects markets to bottom out in April, a dangerous month for stocks because of clashing elements. He added that “Prices may rebound as the Year of the Mouse continues, without setting new highs.”

Chinese astrology, based on a mix of philosophy and astronomy dating back more than 3,000 years, has 12 animals that combine with five elements to define each year, making up a 60 year cycle.

Singapore based astrologer since 1995 and founder of the Harmony Academy of Chinese Metaphysics made money for his clients in 2007 by telling them Asian equity markets would turn in peak performances in the Year of the Pig.

Chinese winter hits tin production

With China’s southern provinces suffering the worst weather conditions in 30 years in January, many mines and smelters are reported to have shut down, particularly in Hunan and Jiangxi. The two provinces accounted for over 20% of China’s tin production last year.

In Hunan one source reports that all mines and smelters are currently closed. Hunan produced just over 26,000 tonnes of refined tin in 2007 according to provisional CNIA data, 17% of national production. In Jiangxi several small mines and smelters are also reported to be closed.

In the two largest tin producing provinces, Yunnan and Guangxi, there has been relatively little disruption, although interruptions to power supplies and transport problems have caused some concerns in Guangxi.

The weather problem proceeds China’s Spring Festival holiday, which has started, when many producers and consumers schedule plant shutdowns.

Anshan Steel signs first CDM agreement

It is reported that Liaoning based Anshan Steel has signed an agreement to sell carbon dioxide emission reduction credits to European Carbon Fund and Camco International Limited on February 1st 2008. This is the steel maker's first Clean Development Mechanism project so far.

Anshan Steel started Clean Development Mechanism project in Aug 2006 and submitted application to the National Development and Reform Commission in last April 2008.

The Clean Development Mechanism is one of three mechanisms for global Greenhouse Gas emissions reductions outlined in the Kyoto Protocol. The purpose of this mechanism is to assist developing countries achieve sustainable development and assist developed countries achieve compliance with their quantified GHG emission limitation and reduction commitments. The core of Clean Development Mechanism is to allow developed countries to acquire Certified Emission Reductions generated by projects implemented in developing countries.

Gansu Jiu to increase stake in associate

Gansu Jiu Steel Group Hongxing Iron & Steel Company Limited announced that the Company will invest additional CNY 50 million in its 30% owned subsidiary whose registered capital will increase from CNY 30 million to CNY 80 million.

After the capital injection, the stake, which the Company holds in Company A, will increase from 30% to 73.75%.

Xinxing Ductile to buy iron ore from Xinjiang

It is reported that Xinxing Pipes Group has signed a framework agreement with Xinjiang Aletai authority and the local Hongtai Mining Company Limited to carry out overall cooperation in mineral resources exploration and deep processing.

Mr Liu Mingzhong chairman of Xinxing Pipe said that he hoped to invest a sum of billions of yuan in Aletai area during the 11th and 12th five year periods to shape a complementary and cooperative industry layout. Officials of Aletai region noted they were supportive to Xinxing Pipes in mining and consolidating the industries in its region.

Shanghai exchange to launch steel contracts

It is reported that Shanghai securities Exchange is releasing oil, wire rod and deformed bar securities and has gained some experience in development and expected to be listed before the end of this year after the approval of China’s Securities Regulatory Commission.

Mr Zhu Bing director of Nanhua Securities Institute said that “The annual output of domestic steel market has outstripped 500 million tonnes. Steel Security can provide a platform for reflecting and revealing information, which is beneficial for guiding market and enterprises’ pricing, additionally for companies to make use of some means such as hedge to keep from price risks.”

Shanghai Security Exchange said it is mature for china to launch crude oil and gas securities and has finished developing the securities of oil series such as liquefied petroleum gas and asphalt. It is waiting for the proper opportunity and has no obstacle to be listed.

In addition, Shanghai Security Exchange will put out metal, energy, and chemical product securities on the basis of other listed six varieties including copper, zinc, aluminum, fuel oil and gold.

Angang group steel assets will be listed as a whole

It is reported that Anyang iron and steel issued a notice that the company had received a notice from the supervision commission which approved the steel company to issue 375 million shares to buy related assets from Angang group. The assets appraisal value is CNY 3.315 billion.

The notice said that the purchase assets mainly consist of 78.14% stake of Yongtong company which is under Angang group, 100% stake of Jianan company, 100% stake of mechanism company, the related assets of 450 million blast furnace of Angang group, and the group owned land use right of above mentioned.

Anyang Iron and Steel Securities Department disclosed that after completion of the acquisition, the Group has no steel assets steel assets of Angang group will be listed as a whole.

Jinxi Steel to make largest H-beam base in China

It is reported that Jinxi Steel’s H-beam production line which can produce 1.5 million tonnes of products per year is the World’s most advanced H-beam production line, and the products are sold to Japan, South Korea etc 15 countries.

As per report in March 2008 Jinxi Steel will invest CNY 2.6 billion to construct a small and medium sized H-beam project with an annual production capacity of 1.2 million tonnes, at that time, Jinxi Steel will become the largest H-beam production base in China.

Italian firm places more orders with Shanghai Waigaoqiao Shipyard

It is reported that Italian shipping company Rizzo-Bottiglieri-De Carlini Armatori SpA offered a USD 180 million contract to Shanghai Waigaoqiao Shipyard for two 177,000 DWT ships.

Mr Giuseppe Mauro Rizzo MD of RBD Armatori said "These will be the largest ships in our fleet. With them, we will develop a deep and stable commercial relationship with China, especially with its major steelmakers."

In the past two years, RBD Armatori has ordered four 110,000 tonne Aframax tankers and four 87,500 tonne Post Panamax bulk carriers from Shanghai Hudong Zhonghua Shipyard, worth a total of USD 450 million. All the ships will be delivered between 2009 and 2011.

With the latest contract, the Italian shipping major has ordered 10 vessels from Chinese shipbuilders worth about USD 650 million. All orders went to shipyards under the State owned CSSC group.

Egang coating complex products new products

It is reported that CR sheet mill of Egang recently has improved related technology of galvanizing lines and successfully exploited new continuous annealing products. Now its galvanizing line is able to produce both galvanized products and continuous annealed products.

The CR sheet mill has already produced over 1,000 tonnes of continuous annealing sheet and the quality reaches SPCC standard fro CR low carbon steel.

The price gap between the cost and the market price of galvanized steel products is short in current market, so there is almost no profit space for galvanized products. The successful exploitation of continuous annealing products will confirm the continuous and steady operation of galvanizing line and increase margins as well.

China to shut down 13 million KW of coal fired power capacity in 2008

It is reported that China would continue to shut down small coal fired power stations in 2008, targeting a total capacity of 13 million kilowatts, as part of its efforts to save energy and reduce greenhouse gas emissions.

National Development and Reform Commission said that the figure is about 30% more than the target of 10 million kilowatts set for last year.

China had managed to close 553 small thermal power generators in 2007, with a total capacity of 14.38 million kilowatts above the annual goal.

Ukrainian crude steel output in January up by 1.4% YoY

Millennium Capital reported that the total crude steel output of the 12 largest Ukrainian steelworks grew by 1.4% YoY to 3.583 million tonnes while rolled steel output increased by 0.6% YoY to 3.064 million tonnes.

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Severstal releases 2007 operational results

Severstal has released its 2007 operational results. The release said production of crude steel in 2007 was 17.5 million tonnes broadly in line with 2006 numbers. The decrease in production at SNA during the period was compensated for mainly by growth in Russian Steel. Production of rolled products was up by 2%YoY.

The increase in production of iron ore and pellets in 2007 was 6%. Net of inter company sales production was up by 16%YoY. Total production for sales of coal was down 3%YoY. Net of inter company sales production was down by 15%YoY.

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Fire reported at Kalinina coalmine in Donetsk

Ukrainian News Agency reported that a fire has erupted at Kalinina Coalmine, an independent enterprise in Donetsk belonging to the Donetsk Coal & Energy Company. According to the report, the accident occurred at a death of 740 meters at 7:25 AM on January 6th 2008.

21 miners were in the mine at that time. All of them managed to escape to the surface without any assistance.

Eight teams from the Coal Industry Ministry’s militarized mine rescue service were still extinguishing the fire as of 7 AM on January 7th 2008.

Fourteen miners are working on the site to keep the mine operational.

US Steel Serbia starts hydraulic gun and drill at BF No 2

Metal Producing & Process reported that US Steel Serbia started its No. 2 blast furnace in December, following a extensive rebuild that incorporated a fully hydraulic gun and drill, designed and built by Woodings Industrial Corp.

The new gun and drill provide US Steel Serbia with completely automated plugging and tapping.

The gun is built for a 4,100 psi hydraulic operating pressure, nozzle pressure of 3,000 psi and it features a high-performance hydraulic system with PLC control. The drill incorporates a fully hydraulic drifter that is configured in a unique housing design. The rotary percussion hammer is the strongest and most compact hammer available for blast furnace operation.

IUD to invest USD 289 million in Gdansk shipyard

It is reported that Ukrainian steel producer Donbas is ready to invest USD 289 million in Polish shipbuilder Gdansk to upgrade its facilities. The company said the cash would be spent by 2011 and would help the yard turn out between 10 and 12 ships per year.

It is said Donbas faced a sizeable bill to modernize Gdansk including a new assembly area and a syncrolift or floating dock as an alternative to launching vessels from its three slipways, which it does not own.

IUD has been building a stake in Gdansk where consultants have been studying its future potential as a shipyard. It earlier added to a 5% shareholding by purchasing roughly 13% held by former parent Gdynia.

Lukoil's processed 42.548 million tonnes of oil in 2007

FIS reported that Lukoil boosted oil refining at own enterprises by 7.7% to 42.548 million tonnes due to modernization and expansion of refining capacities and high margin of Russian oil refining.

The growth was mostly provided by Nizhniy Novgorod Oil Refinery.

GM to expand production capacities in Russia

FIS cited Mr Carl Peter Forster president of General Motors as saying that US automotive concern General Motors is set to build up a second plant in Russia or expand the capacities of the plant currently under construction in Shushary to 75,000 cars per annum.

Nizhny Tagil completes replacement of off gas systems

It is reported that Siemens Metals Technologies replaced and started up a BOF converter and the off gas treatment system at Russian steel producer Nizhny Tagil Iron & Steel Works.

The project is part of a wide ranging modernization program, within which Siemens will replace three more BOF converters by 2009, including the environmental facilities.

Gazprom Neft to boost oil output by 0.9% in 2008

The oil producing arm of Russian energy giant Gazprom, Gazprom Neft said that it expects to boost annual crude output by 0.9%YoY in 2008 to 33 million tonnes.

Mr Alexander Dyukov president of Gazprom earlier said Gazprom Neft intended to boost crude output to 80 million tonnes to 90 million tonnes per year by 2020 and that oil refining would account for at least two-thirds of crude production.

Mr Dyukov said Gazprom Neft which signed a deal on the purchase of a 51% stake in the Serbian state owned oil monopoly Naftna Industrija Srbije during talks between the two countries leaders in Moscow in late January is interested in buying other refining assets in Europe in the long term.

Mr Dyukov said Gazprom Neft which bought a 50% stake in Tomskneft from state oil company Rosneft in late December would like to acquire the remaining 50% stake in the west Siberian oil producer, most likely by way of an asset swap.

He also said Gazprom Neft's proven reserves were expected to reach at least 2.2 billion tonnes by 2020.

Stroytransgaz to build the second gas processing plant in Syria

FIS reported that Stroytransgaz' OJSC started the construction of gas processing plant No 2 and development of five gas deposits in the northern part of Syria's central region.

The new plant will have the capacity of 1.3 billion cubic meters per annum. The commodity gas will be transported by the existing gas pipeline to Aleppo and condensed gas supplied to the oil collecting station Al-Suffian.