Stemcor takes stakes in Satha Vahana Ispat

Steel trading major Stemcor has entered into a strategic partnership with Satha Vahana Ispat Limited, under which Satha Vahana Ispat Limited has issued new preferential shares to fund expansion plans and Stemcor has acquired a 14.69% stake in the enlarged shareholder structure.

As a strategic investor, Stemcor is providing Satha Vahana Ispat Limited with bridging finance in addition to taking an equity stake. Stemcor is Satha Vahana Ispat Limited’s supplier of coking coal and will continue to be the supplier when production capacity is expanded.

Mr David Faktor MD of Stemcor said that “SVIL is a well run company with a strong position in the market. We are delighted to be playing a role in its expansion and look forward to working with the experienced management team under Mr AS Rao.”

Satha Vahana Ispat Limited commissioned a 300,000 tonnes per annum metallurgical coke production facility in Karnataka in March 2007. The expansion project will add 2 further coke oven batteries and increase capacity to 425,000 tonnes per annum.

Approximately 70% of output is currently consumed by captive pig iron plant and the balance is sold to the domestic market. Satha Vahana Ispat Limited’s pig iron plant is located in Andhra Pradesh. It has a rated capacity of 210,000 tonnes per annum of foundry grade pig iron. Surplus output after expansion will meet increasing demand for metallurgical coke from steelworks in the Bellary belt, which currently require more than 3 million tonnes per annum and rely heavily on imports.

Satha Vahana Ispat Limited is a public company quoted on the Bombay Stock Exchange. Mr AS Rao and family have a substantial shareholding in the company.

ArcelorMittal, Auerhammer Metallwerk and Shivalik Bimetal form JV

It is reported that ArcelorMittal Stainless and Nickel Alloys, a wholly owned subsidiary of ArcelorMittal, announced a tripartite joint venture with Germany's Auerhammer Metallwerk and Shivalik Bimetal Controls to set up a metal cladding plant at an investment of INR 40 crores to INR 50 crore.

Each of the three companies would have a one third equity participation in the venture. Auerhammer Metallwerk GmbH will join the venture through its subsidiary D Nick Holding plc. Shivalik Bimetal is a listed company.

The new venture, to be called Innovative Clad Solutions, would have an initial production of 10,000 tonnes annually. The plant will become operational in the next 15 months. According to plans, about 65% of the production will be exported. The raw materials will be provided by ArcelorMittal.

Mr SS Sandhu chairman of Shivalik Bimetal Controls said "We will invest INR 40 crores to INR50 crore in the first phase of the plant. We have zeroed in on a special economic zone in Indore for setting up the plant."

Mr M Chaboud CEO of ArcelorMittal Stainless and Nickel Alloys said that this is just the beginning of a new era of metallurgy in India. He said “We are going to provide innovative application solutions based on our state-of the art R&D capabilities. This technology and product will take India to the next level.”

Clad metal technology provides a method of combining the characteristics of two or more metals into composite metal systems having properties designed to meet specific applications in auto components and bullet jacket manufacturing, besides marine engineering and other industries. The investment would be made equally by the three companies.

SAIL presents interim dividend of INR 670.49 crore

Steel Authority of India Limited has paid INR 673.49 crore as interim dividend to the Government of India for the financial year 2007-08. The cheque was handed over to Mr Ram Vilas Paswan union minister for steel, chemicals & fertilisers by Mr SK Roongta chairman of SAIL.

On January 29th 2008, while taking on record the company's achievement of highest ever net profit after tax of INR 5,160 crore for the first nine months of the current financial year, SAIL board had announced interim dividend for the company's shareholders at a rate of 19% of paid-up equity, amounting to INR 784.78 crore. This is the highest ever interim dividend paid by the company so far. SAIL will also pay the Government dividend tax amounting to INR 133.37 crore for the interim dividend payout.

SAIL has regularly been paying dividend to its shareholders since 2004-05. The company has since paid INR 4,254 crore as dividend, including this interim dividend, to its shareholders. Of this, dividend payout to the Government of India amounts to INR 3,651 crore, besides INR 632 crore paid as dividend distribution tax. SAIL's contribution to the national exchequer towards excise and custom duties, corporate tax, dividend, dividend tax etc for the period April 2004 to December 2007 stands at around INR 35,160 crore.

SAIL has been able to improve its profitability and consequently higher interim dividend payout for the financial year, mainly due to improvement in product mix, substantial increase in production of special grade steel and value added items, cost reduction and higher net sales realization.

During April to December 2007, SAIL recorded its best ever production of 9.6 million tonnes of saleable steel. Around 0.37 million tonnes of additional finished steel were produced during the period from existing mills by maximizing capacity utilization, reducing production of semis, and thereby improving the share of finished steel to 84% from 81%. SAIL plants operated at an average capacity utilization of 115% during the period.

ArcelorMittal to start work in India by December 2008

It is reported that ArcelorMittal will start work on its proposed 12 million tonne each steel plants in Orissa and Jharkhand at an investment of INR 80,000 crore by the end of 2008. ArcelorMittal has already short listed Torpa in Ranchi district and Kamdara in Gumla as sites for its plant.

Mr Sudhir Maheshwari executive VP finance and M&A of ArcelorMittal said that "We would start construction of each of the 2 projects in Jharkhand and Orissa by the end of the year. We are in advanced stage of submitting our detailed project report for the two projects."

He added that “We have applied for linkages from Chiria in Jharkhand but have also applied for other mines in Jharkhand and Orissa.” Mr Maheshwari, however, refused to divulge details on specific geographies that are on company's radar. The two projects will need 600 million tonnes of iron ore. It has also applied for four iron ore mines in Jharkhand, including the mines at Karampada and Ghatkuri.

As per report, ArcelorMittal is formulating a 15 member team to finalise the blueprint for setting up plants. Mr Jose Armando Campos CEO of ArcelorMittal Brazil said that "Our Group Management Board has approved the constitution of a 15 member technical team for our steel projects in Orissa and Jharkhand under the supervision of our Chief Technical Officer Mr Pierre Gugliermina.”

Last year, the steel maker said it had been allocated two coal blocks for captive power projects linked to its steel plants in the two states.

POSCO survey work resumed under a cloud

It is reported that Orissa government has managed to resume the suspended socio economic survey in the villages being affected by the proposed POSCO’s steel plant in Orissa and will continue for a month if all goes well.

As per reports, villagers, agitating against the proposed mega steel plant, have agreed to allow the survey team after three days of intense negotiation after POSCO and the government have agreed to meet most of the demands made by agitators.

There have been sporadic protests in the state both in favour and against the project. SNS reported that a sense of uncertainty prevails over the resumption of the socio economic survey work for the proposed POSCO project. As per report, the differences within the united action committee members has now invigorated the anti project groups like POSCO Pratirodh Sangram Samiti, Naba Nirman Samiti and the Mahabir Yuvak Sangh. These anti project outfits which had remained silent over the past few months have now started holding meetings to oppose the survey work.

7,263 MW of powers capacity added in last 10 months

Mr Sushilkumar Shinde union power minister announced that power projects to the tune of 60,214 MW has already under construction, while during the period of April 2007 to January 2008, a total of 7263 MW has already been added.

The total generation of electricity in India during the April to December 2007 period was 526 billion units up by 6.6% YoY as compared to about 493 billion units during the April to December 2006 period. The plant load factor of thermal power stations in India during April to December 2007 was 77.2% as compared to 75.3% during the April to December 2006 period. The PLF of central sector generating stations during the current year increased from 82.3 % last year to 85.4% this year.

Mr Shinde said that “56,722 MW capacity additions have taken place during the last 3 plans. The capacity addition during the 8th Plan was 16,423 MW and in the 9th Plan it was 19,119 MW while in the 10th Plan it was 21,180 MW.”

For the 11th Plan 78,577 MW has been proposed for capacity addition. In addition 14,000 MW is expected through Renewable and another 12,000 MW from captive route.

India’s current installed capacity is over 140,300 MW comprising
1. 90,645 MW Thermal or 64.7%
2. 34,681 MW Hydro or 24.7%
3. 4120 MW Nuclear or 2.9%
4. 10,855 MW Renewable or 7.7%

Nissan & Volkswagen select TATA Steel as preferred supplier

BS reported that TATA Steel has been selected by Volkswagen and Nissan Renault as the local steel partner for their projects in India. According to report, TATA Steel has been approved for sourcing steel by the auto majors and specific products will be developed for their respective projects.

Steel for Volkswagen and Nissan Renault projects would be sourced from TATA Steel’s Jamshedpur plant, whose capacity is being expanded by 2 million tonnes to 7 million tonnes. The additional capacity will go on stream by June 2008. By 2010, the total capacity will be 10 million tonnes.

Volkswagen and Nissan Renault have lined up major plans for India and details are currently being worked out. Nissan is in the process of establishing a plant in Chennai in partnership with Renault while, Volkswagen is bullish about the Indian market, as it has already announced that it would introduce two cars this year and build 110,000 cars once its plant goes on stream next year.

TATA Steel has been reorienting its product mix with a focus on auto grade steel for a while. In 2006-07, TATA Steel enjoyed 45% of the Indian automotive steel market, translating into 700,000 tonnes of steel. Apart from these projects, it has bagged deal for skin panel from Hyundai and Ford. It is also a 100% supplier to Maruti Suzuki India for its inner panels and 96% steel for the Toyota Innova.

Usha Martin launches new Joh Pengg JV unit

It is reported that India’s leading producer of speciality steel and wire ropes, Usha Martin has inaugurated its 40:60 JV with Austrian Joh Pengg AG called Pengg Usha Martin Wires Private Limited at its Ranchi plant for manufacture of oil tempered wires. The JV agreement between Usha Martin and Joh Pengg AG was signed on March 21st 2006.

Mr Gottfried Pengg chairman of Joh Pengg said that “We are indeed happy to partner with Usha Martin group in India and are confident that the combined resources of our two companies will make this enterprise highly successful.”

Mr BK Jhawar chairman of Usha Martin said that it is always committed to introducing high quality value added products with world class technologies and the JV with Joh Pengg to manufacture oil tempered wires was an initiative in the direction.

The cost of the first phase of the project is INR 46 crore, which is being funded by share capital of INR 18 crore, balance INR 28 crore funded from promoters loan of INR 11 crore and long term loans of INR 17 crore.

Joh Pengg AG is a global leader in producing oil tempered wire for the automotive industry.

Dock workers demand 15% interim relief

It is reported that 5 recognised major federations of the port and dock workers in India have demanded that the port and dock workers should be paid 15% of the basic pay as interim relief with effect from January 1st 2007 subject to certain conditions.

Mr SR Kulkarni president of the All India Port & Dock Workers Federation said that all the 5 federations have put forward their joint claim in the larger interest of the port and dock workers. He cautioned that if the legitimate claim for interim relief is not accepted by the port authorities and the government, the federations would stick to their original demand that interim relief should be paid at the rate of 25% of basic pay plus dearness allowance.

They demanded that if any other public sector undertaking gives more than 15% inclusive of DA, the same enhanced rate should be made applicable to port and dock workers also.

HZL raises zinc and lead prices

Hindustan Zinc Limited has increased its zinc prices by 3.1% to INR 110,000 per tonne effective immediately. Lead prices were also raised by 3.1% to INR 125,100 a tonne.

LNJ Bhilwara inks pact with Glitnir Bank for geothermal power plants

It is reported that LNJ Bhilwara Group along with Iceland based Glitnir Bank formed a 60:40 JV to develop geothermal power plants in India and Nepal. LNJ Bhilwara Group is yet to identify the location for these plants.

The JV will have an authorised capital of USD 10 million, while the North European bank will put in USD 4 million along with the technology for generating renewable energy contained in underground reservoirs of steam, hot water and hot dry rocks.

Mr Larus Welding CEO of Glitnir Bank told reporters that “We are happy that this important joint venture has been formed with LNJ Bhilwara Group. This will encourage prospects for growth in India in the geothermal arena. Glitnir had successfully implemented a project in China. We believe similar projects can be developed in India.”

Mundra Port to invest INR 10,000 crore to enhance capacity

BL reported that Mundra Port & Special Economic Zone is planning to infuse around INR 10, 000 crore within a period of 3 years to increase the capacity of cargo.

It will enhance the capacity of cargo from 30 million tonnes per annum to 50 million tonnes per annum by 2010 and to further increase the capacity to 120 million tonnes per annum by 2015.

As per report, a major portion will be invested to fund a coal terminal of 35 million tonnes per annum capacity by 2010 at the port.

NTPC bags Mother Teresa Award 2006

National Thermal Power Corporation Limited has received the Mother Teresa Award 2006 for community development work.

The award, now in its 10th year, was instituted by the Loyola Institute of Business Administration, in memory of Nobel Laureate Mother Teresa, recognising contributions of corporate in the area of ethical governance.

Tamil Nadu to import Pakistani cement

It us reported that Mr M Karunanidhi chief minister of Tamil Nadu has given a go ahead signal to import of cement from Pakistan.

Tamil Nadu is starved of the commodity that it needs for fast growing infrastructure building requirements and the step taken by the chief minister appeared to be in frustration over the Indian cement companies’ disregard to urgings to increase supplies and bring down prices. Tamil Nadu Cement Corporation would import at comparatively cheaper prices.

Mr Chitty Babu of Confederation of Real Estate Developers Association of India stated that builders would be happy to get a huge relief of INR 25 per 50 kilogram bag.

The export price to India carries significant premium over what the cement fetches in local markets and unlike local sales, exports were exempt from general sales tax and central excise duty.

Maharashtra sets up SPV to facilitate private investment

Projects Today reported that Maharashtra government has teamed up with the private sector to set up a special purpose vehicle, which will facilitate private investment in urban infrastructure projects.

The SPV named Maharashtra Urban Infrastructure Development Corporation plans to leverage its revolving corpus of INR 51 crore contributed the state to take up projects worth INR 10,000 crore on build operate transfer basis. It is the first state sponsored agency dedicated to urban infrastructure, in which private companies will hold 51% stake.

Maharashtra Urban Infrastructure Development Corporation has begun work on four projects for which it will scout for private players. The projects include
1) Taraporewala Aquarium- INR 200 crore
2) Museum on INS Vikrant – INR 200 crore
3) Eight kilometre long creek bridge to Koparkhairane in Navi Mumbai
4) An integrated road project

REC joins IIFCL and Hudco to fund power projects

PTI reported that Rural Electrification Corporation has entered into agreement with 2 other PSUs, IIFCL and Hudco, for lending funds to Greenfield power projects of over 1,000 MW, proposed to be set up under public private partnership.

Source said the consortium would provide up to INR 4,000 crore to each project. It added that “The move is to ensure that REC is well positioned to provide speedy consortium refinancing for large power infrastructure projects.”

Union power ministry is reported to have asked REC and Power Finance Corporation to mobilise resources. The total fund requirement for the power sector has been assessed at around INR 1,000,000 crore for the 11th Plan.

The government targets to add 78,577 MW in the 11th Five Year Plan to the existing installed capacity of over 1,30,000 MW. Of the over 78,000 MW, about 39,500 MW is required to be added by the centre, while an additional 10,700 MW is expected to come from private players. States are likely to add 27,900 MW power in the 11th Plan. The working group on power for the 11th Plan has estimated that the fund requirement for creation of projected capacity expansion alone will be about INR 410,000 crore.

StatoilHydro inks MoU with ONGC to explore clean mechanism projects

It is reported that StatoilHydro and Oil & Natural Gas Corporation has signed a MoU to jointly explore the potential of developing carbon capture & storage and clean development mechanism projects in India.

The cooperation could result in CO2 emissions reduction projects as well as the promotion of energy efficiency and growing use of renewable energy under the mechanisms of the Kyoto Protocol.

Mercator to acquire 3 dredgers for USD 100 million

BL reported that shipping company Mercator Lines Limited is planning to acquire 3 dredgers for USD 100 million in the next 6 months. The acquisition will increase the number of dredgers owned by the company to 6.

Mr Atul J Agarwal MD of Mercator Lines Limited, while addressing at India Maritime Summit 2008, said that “We are planning to expand our dredging business and for this purpose we are looking to acquire 3 more vessels. The vessels, like the previous ones, will be acquired from Chinese companies.”

He added that it has already placed orders for the additional dredgers, which are expected to join the existing fleet within a 6 month period.

While Mercator Lines would deploy the new dredgers on long term charters for 2 to 3 years, it has also initiated talks with various ports and private companies for offering the dredgers on contract. It had earlier announced its intention to foray into the areas of dredging, offshore services and mining.

Mercator Lines is also looking at providing offshore supply vessels services. It had signed agreements with a Norwegian company for rights to operate 9 Panamax vessels of total 644,069 DWT carrying capacity on charter. Through its subsidiary Mercator Singapore, it is looking to expand its fleet further by adding another 10 to 12 vessels.

SKS Logistics to foray into offshore sector

BL reported that SKS Logistics would be entering the offshore sector by converting one of its 9,600 DWT barges into an offshore accommodation vessel.

Mr SK Shahi CMD of SKS Logistics said that “The vessel will be suitable for laying pipe and would be able to accommodate 400 people. It would have a helipad and a 200 tonne crane.”

Currently, it is using a multipurpose tug in the offshore industry. In addition, it would also be acquiring 4 multipurpose containers cum cargo vessels to be run on a fixed schedule on the Indian coast.

He added that “We are looking to add two of these vessels of 10,000 DWT each with a capacity of 600 containers by the first quarter of 2009.”

SKS Logistics has posted a net profit growth of 87% YoY at INR 1.5 crore for October to December 2007 quarter as against INR 0.8 crore, while the total income grew up by 32% YoY at INR 13 crore from INR 9.8 crore.

Newcastle coal shipments in January dip by 26% YoY

Bloomberg reported that coal shipments from world’s largest Newcastle Port in Australia fell by 26% YoY helping prices to jump to record levels. Loadings dropped to 1.47 million tons in the week ended February 4th 2008.

The Hunter Valley Coal Chain Logistics Team, coordinator of coal exports from the Hunter Valley through Newcastle Port said ''Coal availability is currently at low levels at most mines. Of the 23 ships waiting to load coal as of January 31st 2008, 9 had coal availability issues. The reduced loadings contributed to an increase in vessels waiting off the port to load coal to 28, up from 22 a week ago.”

Port Waratah Coal Services Ltd., operator of the two coal terminals at Newcastle said that In January, the average vessel queue was 27, down from an average of 55 last year. Ship loading ran at an annualized rate of 91.3 million tonnes a year in January.

Thermal coal prices at Newcastle, a benchmark for Japan, South Korea and Taiwan, have soared as snowstorms in China, power cuts in South Africa and floods in Queensland reduce output. Xstrata Plc, Rio Tinto Group and other miners are struggling to meet increasing demand due to bottlenecks in port and rail networks in Australia's east.

BHPB bid for Rio – Japanese steel mill voice opposition

ABC Radio reported that Mr Hajime Bada president of JFE Steel has reaffirmed the opposition to BHP Billiton's acquisition of Rio Tinto. ABC Radio reported that Japan's second largest steel maker, JFE Holdings Inc, believes that the deal would be detrimental to the Japanese steel industry as the merged group would have too much pricing power in the iron ore market.

Mr Bada also the chairman of Japan Iron and Steel Federation said that 70% control of iron ore seaborne trade by major 2 companies including Vale is almost monopoly. He expects competition authorities in Australia, Europe and Japan would reject the merger to prevent excessive concentration.

Mr Bada told the news organisation that while Japan does not have the ability to block the deal, the industry is lobbying corporate regulators in Australia and the European Union to closely monitor the deal.

Mr Bada was also concerned about China's state owned aluminium giant Chinalco, in concert with Alcoa Inc, gaining a 9% stake in the Rio Tinto group last week. He said 'We have to bring to light the very big issue, which is that China is a country that has very significant foreign reserves and the state may use them in support of its industry.”

Rio Tinto reports 3 billion tonnes of additional iron ore Resources

Rio Tinto has further strengthened its leading position in the Pilbara with a 3 billion tonne addition to its iron ore Resource base. This came through the discovery of a major new resource at Caliwingina and significant improvement in confidence of resources associated with known deposits.

1. Caliwingina Resource
The newly discovered Caliwingina Resource is within the Mt Pyrton Project area which lies 100 kilometers north northwest of Tom Price and is approximately 15 kilometer from the Rio Tinto Iron Ore Tom Price to Dampier railway line.
Caliwingina North CID Deposit Inferred Mineral Resources for Fe >55%
In million tonnes

2. Reporting of Brockman Process Ore
Brockman Process Ore is being reported here for the first time. The additional resource is contained within the mineralization envelope that also defines the high grade for 15 known deposits. All Process Ore is reported as insitu tonnes and grade.
Brockman Un-Developed

3. Increase in Hope 4 Resource base
Re estimation work on Hope 4 during 2007 has added an additional 290 million tonnes of Resource. Hope Downs 4 has added an additional 95 Mt of HG

Mr Sam Walsh CEO of Rio Tinto Iron Ore said that significant technical and study work has led to increased confidence in Rio Tinto's position in the Pilbara. He added that "Rio Tinto occupies the largest mineralization and land position in the Pilbara, one of the world's great iron ore producing regions. This advantage is strengthened by addition of the newly discovered Resource at Caliwingina, comprising 875 million tonnes of iron ore only 15 kilometers from our railway and only 150 kilometer from our ports at Dampier and Cape Lambert, as well as significant additions around known deposits."

Drill evaluation work will continue in the Caliwingina Prospect during 2008/09 to update the resource base. Also diamond drilling will be conducted to improve grade estimation confidence as well as for Metallurgical and density test work.

Corus hikes plate and section prices

Corus announced that it will be increasing basis prices for reversing mill plates by GBP 60 per tonne effective to all dispatches after March 30th 2008 and an addendum to Price List 7 is currently being prepared and will be issued during the next few weeks.

Corus Construction & Industrial will also be raising basis prices for structural sections by GBP 60 per tonne. This change will be reflected in the published price contained in Price List 5 and will apply to all material despatched from March 30th 2008. An updated edition of Price List 5 will be issued shortly.

The release said that “Since December 2007, the global market for Reversing Mill Plate has continued to exhibit very strong levels of demand, rapidly rising raw material prices and energy costs. The healthy demand for plate is apparent in all key global consuming sectors.”

For sections, the release added that “The price increase is a direct consequence of the considerable increase in raw material costs due to the high global demand for steel. UK demand in 2007 is likely to be confirmed at levels close to the peak experienced in 2004. The market is expected to remain buoyant in 2008.”

NSM files complaint against SDI – Report

Bloomberg reported that Steel Dynamics Inc is accused in a lawsuit of making false statements to investors that caused a Thai owned start up mill to lose USD 1.1 billion. The complaint was filed in federal court in Fort Wayne by Prime Eagle Group Ltd an assignee of the once bankrupt Thai mill operator Nakornthai Strip Mill Public Co.

The Nakornthai Strip Mill located at Choburi in Thailand was finished in 1997. During construction, its managing agent entered into a confidential consulting agreement with Steel Dynamics that, according to Prime Eagle complaint, the Fort Wayne based company breached by publicly criticizing Nakornthai Strip Mill's plant equipment, design and management.

According to the complaint filed February 1st 2008 the comments caused investors to lose confidence in Nakornthai Strip Mill, leading to the closure of the Nakornthai Strip Mill steel plant for approximately five years.”

Nakornthai Strip Mill attorneys in the filing said that the mill was later able to reopen without having to make the design modifications said to be needed by Steel Dynamics. According to the suit, the criticisms were false and were used as a pretext for stealing trade secrets from Nakornthai Strip Mill.

Steel Dynamics in a regulatory filing disclosing the suit said that "Steel Dynamics believes that the allegations and claims set forth in the complaint are baseless and without merit.”

Outokumpu expands SS service centre in France

Outokumpu announced that in order to improve service to French stainless steel customers and in line with the strategy to increase sales to end users and project customers, it will expand its stock and processing capability in France.

The release said that the project will entail the relocation of the current coil service centre from Azay sur Cher some 40 kilometre east to new premises in Noyers sur Cher in Central France. New cutting equipment will be installed to enable the processing of stainless steel plate as well.

The combined coil and plate processing capacity of standard and special stainless steel grades will be 40,000 tonne per year and it will be in place by the end of 2009. The total investment is some EUR 14 million over two years.

Its product portfolio will include both standard and special like duplex and lean duplex stainless steel grades of coil and plate, which are polished and cut to required dimensions and shapes.

Mr Gerard Sourjous GM of Outokumpu said that "The French stainless steel customers have shown the tendency to deal with close by service centres rather than directly with mills. To answer this call, the expanded service centre in Noyers sur Cher will be able to serve customers with timely deliveries of products that are tailored to their individual needs.”

Furthermore, by 2010 at the latest, the French market will be served with Outokumpu's ferritic grades and bright annealed products from the adjacent new service centre in Southern Germany as well as from Italy."

Usiminas could acquire further iron ore assets

BNamericas reported that Brazilian steelmaker Usiminas could acquire further iron ore assets in Brazil following the purchase of three miners in Minas Gerais state.

An analyst with brokerage Planner Corretora told BNamericas that the steel producer recently snapped up 100% of companies J Mendes, Somisa and Global Mineração for an initial total of USD 925 million, while further payments could be made depending on the results of drilling over the next two years.

He added that "With this acquisition by Usiminas, iron ore assets have become scarcer. I could not say precisely how scarce, but I believe there are few high quality assets available for sale."

According to the analyst Usiminas would need additional supply of the steelmaking input to expand its capacity as planned over the coming years. He added that "I believe the steel company will be the first candidate to pursue new iron ore acquisitions adding that local steelmaker CSN will not need to carry out takeovers in the area since it owns the Casa de Pedra mine that is to see a capacity increase from 16 million tonne per year to 70 million tonne per year by end 2011.”

Usiminas' plans include expanding output at its Ipatinga mill by 2.2 million tonne per year to 7 million tonne per year which could be revised to reach 8 million tonne per year. It has also said it aims to install a new 3 million tonne per year steel mill in Brazil.

German steel majors affected by steel workers' warning strikes

Thomson Financial reported that ArcelorMittal's production site at Bremen and ThyssenKrupp AG's site at Duisburg were affected by German steel workers' warning strikes, during which workers down tools for a few hours to back their demands.

As per report Union IG Metall is demanding an 8% pay rise for some 85,000 steel workers in the German states of North Rhine Westphalia, Lower Saxony and Bremen. A third round of talks with employers is scheduled for next Tuesday.

The wage negotiations last week affected steel and pipe maker Salzgitter AG.

Valmont acquires 70% of West Coast Engineering Group

Leading manufacturer of engineered support structures for infrastructure, mechanized irrigation equipment for agriculture and a provider of coating services and tubular products Valmont Industries Inc announced that it has acquired a 70% interest in West Coast Engineering Group LTD, a manufacturer of steel and aluminium structures for the lighting, transportation and wireless communication industries.

Mr Mogens C Bay chairman & CEO of Valmont said that "The West Coast Engineering investment broadens Valmont's customer base in North America and opens up new product and business opportunities for both companies," said

Mr Tom Spears president of the Engineered Support Structures Division of Valmont added that "West Coast Engineering, with three manufacturing facilities in Canada and one in Washington State, will allow us to better serve the north western region of North America. We expect both companies to benefit from sharing our combined resources and capabilities. West Coast Engineering will continue to be led by Raini Habgood-Bailey, Ted Brochman and Jim Parisian. We are delighted that this fine management team will join with Valmont."

Valmont is the global leader in designing and manufacturing poles, towers and structures for lighting and traffic, wireless communication and utility markets, and a provider of protective coating services. Valmont also leads the world in mechanized irrigation equipment for agriculture, enhancing food production while conserving and protecting natural water resources. In addition, Valmont produces a wide variety of tubing for commercial and industrial applications.

1 day strike at Acindar ends

Bloomberg reported that ArcelorMittal steelworkers in Argentina ended a 24 hour strike over workplace safety sparked by a blast furnace explosion that injured eight people.

Mr Carlos Vaccaro a spokesman in a telephone interview from Argentina said that the plant resumed production at 2:30 PM local time.

Mr Vaccaro said that “The workers protested over safety measures'' at the Acindar Industria Argentina de Aceros SA plant near Rosario.”

He added that Acindar workers also demanded higher pay when their current labour agreement expires next month.

US SS alloy surcharges up in February

According to SSB reported, the America stainless alloy surcharges of grade 304 and 316 increased in February 2008. However, the grade 430 has increased since last October.

As the Allegheny Technologies Incorporated one of the biggest specialty metals maker has announced to raise its alloy surcharges of grade 304 from USD 1.30 per short ton to USD 1.41 per short ton, North American Stainless raised its alloy surcharges of grade 304 from USD 1.29 per short ton to USD 1.40 per short ton.

Besides, ATI has also lifted its alloy surcharges of grade 316 from USD 2.20 per short ton to USD 2.35 per short ton. North American Stainless increased it alloy surcharges of grade 316 from USD 2.19 per short ton to USD 2.34 per short ton.

Republic Engineering forms Cold Finished bar division

US producer of special bar quality steel Republic Engineered Products Inc announced the creation of its new Cold Finished Bar Products Division and appointment of Mr Michael Eberth as the division's GM, who would oversee Republic's cold finished bar operations and sales of cold finished bar products.

Republic manufactures cold finished bar at its Gary unit in Indiana, Hamilton in Ontario and Massillon in Ohio, which together now make up the new division.

Mr Jaime Vigil president & CEO of Republic said that "While we have always had the capability and capacity to manufacture cold finished bar products, we saw a significant opportunity for additional growth in this product line. The creation of our new Cold-Finished Bar Products Division and the hiring of Mike Eberth to head the division are two very important steps toward our goal of becoming the preferred partner for companies seeking cold-finished bar products."

He added that "Mike will work closely with Republic's executive staff to establish clear direction for this business unit. He will assess new opportunities in this market as well as current and future capabilities and equipment needs. I have complete confidence that we have the product expertise and people necessary to make our new Cold Finished Bar Division a tremendous success."

Republic's cold finished bar is shipped primarily to the steel distribution, automotive, off highway and aircraft industries. Republic manufactures cold finished carbon and alloy bar products in rounds, hexagons, squares and flats. It also offers cold finished bar in a variety of special finishes, grades and qualities and performs various thermal treatments and other value added processes to the product.

TNB Coal fully owned by TNB

Thestar online reported that Tenaga Nasional Bhd has completed the acquisition of the remaining 7.5% interest in TNB Coal International Ltd from Scenic Worldwide Ltd. With this completion of the purchase, TNB Coal becomes a wholly owned subsidiary of TNB.

The transfer of TNB Coal's 7.5% interest to TNB was one of the conditions precedent to the share sale agreement dated April 30th 2007 by and among PT Dasa Eka Jasatama, PT Pamapersada Nusantara and Dynamic Acres Sdn Bhd, a wholly owned subsidiary of TNB Coal, in relation to the divestment of the entire 99% of Dynamic Acres shareholding in Dasa Eka.

Indiana Steel and Tube plans new distribution centre

AP reported that Indiana Steel and Tube will start construction next month on an USD 8 million project that could create more than 100 jobs by 2010.

Mr Dill Whittymore president of Indiana Steel said that the company will build a steel coil processing, manufacturing and distribution centre. The centre, located in southern Indiana's Jackson County, will help his company serve agriculture, automotive and recreation markets.

Indiana Steel plans to start hiring maintenance technicians, machine operators and clerical staff before it begins operations later this year. The company will process steel coil initially and then added manufacturing next year and in 2010.

ArcelorMittal to relocate eastern France unit staff

Reuters reported that ArcelorMittal will not fire the 600 workers at a plant in eastern France, which is to be closed by the start of 2009.

The report quoted Mr Sudhir Maheshwari executive VP for finance and M&A on the sidelines of a conference as saying that "We are relocating them in other locations in France.” When asked if the employees would lose their jobs Mr Maheshwari said "No.”

Workers' unions had protested the closure of the plant in Gandrange, which produces 900,000 tonnes of steel annually, and the French government has said it is willing to invest in the plant to keep it running.

ArcelorMittal had said the decision to close the plant was based on profitability issues.

SSAB Results for 2007

SSAB fourth quarter result highlights are
1. Sales during the fourth quarter amounted to SEK 16,086 million
2. Profit after financial items amounted to SEK 1,923 million. Excluding non recurring items profit was SEK 2,124 million

SSAB full year of 2007 result highlights are
1. Sales increased by 53% to SEK 47,651 million
2. Operating profit was SEK 8,061 million. Excluding non-recurring items of SEK -922 million, operating profit was SEK 8,983 million.
3. Profit after financial items amounted to SEK 6,399 million. Excluding non recurring items profit was SEK 7,833 million, an increase of 35%.
4. Profit after tax was SEK 4,685 million.

Mr Olof Faxander president & CEO of SSAB said that “SSAB's earnings for the full year of 2007 were the highest in the company's history. The acquisition of IPSCO has gone well both financially and operationally and in line with the objectives reported at the time of the acquisition. The acquisition of IPSCO has negatively affected the result with SEK -829 million, due to significant non recurring items. During the fourth quarter IPSCO made a positive contribution to the result of the Group and the non recurring items that have affected the Group are now behind us.

He added that “By the end of the year, we have now almost refinanced all the loans that were taken up in connection with the acquisition. This has resulted in lower interest expenses and longer terms until maturity. From an organizational perspective, IPSCO is now integrated into the business and the work on achieving the synergies we foresaw is proceeding according to plan. Extensive technical cooperation has been established and, on the marketing side, active work is taking place on harmonizing our sales. The acquisition creates conditions for continued strong development of our niche products. The steel market has been strong during the year, and this is particularly the case as regards demand for our niche products. The trend in our important customer segments, such as mining, energy and the transport sectors has been extremely good. For us, growth depends not only on a generally strong steel market but also on the customers' willingness to move from standard products to more advanced steels within our niches.”

ArcelorMittal announces changes in debt structure

ArcelorMittal further to the press release of June 19th 2007 and the successful completion of the two step merger process, it announced that ArcelorMittal Finance, a Luxembourg governed corporate partnership limited by shares has become the principal borrowing vehicle of the ArcelorMittal Group.

A substantial portion more than 95% of debt formerly at the level of ArcelorMittal was transferred to ArcelorMittal Finance. All of the outstanding debt of ArcelorMittal Finance is now and will continue to be fully and unconditionally guaranteed by ArcelorMittal.

Sundance Resources Mbalam Iron Ore project update

International iron ore company Sundance Resources announced an updated capital and operating cost estimates for its 90% owned Mbalam Iron Ore Project in Cameroon of total CAPEX of USD 3.28 billion.

Sundance Resources in a statement said that this work has been completed as part of the Company's pre feasibility study program. The estimates will be presented today to the Indaba conference in South Africa.

The release said that a study report provided by WorleyParsons has updated the original cost forecasts contained in the 2006 Scoping Study of the Mbalam Project completed by Promet Engineers. The study report is based on December 2007 US Dollar pricing. The estimates remain preliminary and subject to various assumptions in respect of site data, engineering definition, construction and operating conditions, exchange rates, etc. Work is continuing with the aim to progressively refine the project scope and costings.

The project operating financials have been updated using the current operating cost estimate and 2007 FOB contract prices for Australian DSO grade lump and fines products. This shows a potential annual operating margin of >USD 30 per tonne on assumed 35 million tonne per annum production of Direct Shipping Ore hematite. This represents a 20% increase over the operating margin reported on the basis of the 2006 Scoping Study.

Crosslands appoints new CEO

It is reported mid west Western Australian iron ore company Crosslands Resources has appointed a former BHP Billiton and Dominion Mining senior executive Mr Stuart Hall as its new chief executive.

Mr Stuart Hall has taken over the role and his responsibilities will include management of the Jack Hills iron ore project expansion and feasibility studies for the proposed Oakajee project.

Mr Trevor Matthews Resources' director of Crosslands said that Mr Hall has a strong knowledge of the resources industry. He added that "We've been able to attract a very high calibre candidate to take the job on, so that's another step forward in our advancing through to completing our studies to expand that Jack Hills mine and also at least put a proposal to Government in relation to the development of the port and rail.”

Crosslands is jointly owned by Oakajee port and rail project bidding partners Murchison Metals and Mitsubishi Development.

DP World UAE region records 19% YoY growth in 2007

DP World UAE has announced that it has recorded a 19% YoY growth in throughput with the handling of 11 million TEUs at its marine terminals during 2007 as compared to 2006.

A substantial increase in throughput has also been recorded at Dubai's two ports, Jebel Ali and Port Rashid, showing a growth of 20% YoY as compared with 2006, to reach 10.7 million TEUs. Jebel Ali port operations alone grew by more than 25% YoY, with the port handling over 9.9 million TEUs as compared with the volume handled throughout 2006.

Mr Mohammed Al Muallem senior VP & MD of DP World UAE said that "The growth we realised in 2007 was due to a number of factors, the most prominent of which was the increase in trade activity, with a corresponding increase in exports, imports and re exports. Naturally, this resulted in buoyant growth. We have seen continued rapid growth in volumes at Jebel Ali since we first established the facility."

He further added that "Our determination to meet our customers' expanding needs has driven us to continuously upgrade our infrastructure, increasing the capacity of the terminal yards and supplying them with modern machinery to efficiently handle our customers' cargo. The opening of the new container terminal at DP World Jebel Ali in August 2007 has contributed to a substantial increase in our handling capacity. The terminal is able to provide the regular, efficient services required by the new generation mega-sized vessels, and this is a competitive differentiator for our flagship terminal."

Pakistan and Iran to sign gas pact in Tehran next week

Daily times reported that Pakistan and Iran may sign the Gas Sales Purchase Agreement in Tehran in last week of the current month on Iran Pakistan India gas pipeline project.

The report cited a source as saying that Iran has proposed February 24th 2008 to sign GSPA on IPI gas pipeline project in Tehran after the general elections in Pakistan. Earlier, Pakistan had proposed January 25th 2008 to sign GSPA on IPI in Abu Dhabi but Tehran declined to sign it in Abu Dhabi. Tehran told Pakistan that it wanted to sign agreement in Tehran with the new Pakistani elected government.

The report added that draft of GSPA on IPI is ready to be signed by both Pakistan and Iran as Pakistani law ministry has vetted the draft of the agreement.

Larsen & Toubro plans Mini L&T in Gulf

TNN reported that Indian engineering and construction conglomerate Larsen & Toubro will set up a mini L&T in the Middle East, in a bid to enhance its operations in the region. The process is expected to start soon with the floating of a wholly owned subsidiary in the fast growing Middle East market.

As per report, Mr AM Naik chairman of L&T has conceived the idea of replicating the USD 6 billion firm in the Gulf, which is witnessing tremendous growth in construction and engineering.

The report cited a senior L&T official as saying that “L&T has operating divisions such as engineering and construction projects; heavy engineering, engineering construction and contracts; electrical and electronics; machinery and industrial products, information technology and engineering services. All these five divisions will be replicated on a smaller scale, which may consider public offering there in future. The existing businesses will also be consolidated under the Gulf subsidiary. The move allows the company to benchmark itself against the global competitors.

L&T, which undertakes projects in power, fertiliser, hydrocarbon and construction, as well as road, rail and port infrastructure, generates almost 80% to 85% of its revenue from the construction business. Currently, around 18% to 20% of its revenues come from overseas operations, out of which a huge chunk comes from the Gulf. It plans to increase the overseas share to 25% to 30% in the coming years and expecting USD 2 billion revenues from the region by 2010.

L&T has projects worth nearly USD 1 billion in the infrastructure, power and hydrocarbon sectors in the Middle East. L&T has already taken the initiative of forming joint venture companies with local partners. It has already established several JV companies in the UAE, Qatar, Saudi Arabia, Kuwait and Oman.

Saudi Aramco awards major contract to International Resources Group

MENAFN Press reported that Saudi Aramco has awarded International Resources Group a contract to develop an energy modelling system for Saudi Arabia that will provide insight into the evolution of that country's energy system to meet the growing demand for energy within the Kingdom in the most optimal manner.

The award is based on International Resources Group’s work with MARKAL, the market allocation energy analysis model. MARKAL is a set of software tools that can be tailored to analyze energy needs over a number of years or decades, at the global, national and municipal levels. It provides a framework for exploring, evaluating and quantifying alternative policy outcomes and the roles that various policy options can have on technology and resource choices.

Mr Matthew S Mendis corporate VP of International Resources Group "The Saudi Aramco contract is representative of an important component of IRG's commercial sector practice. The demand for these energy systems analysis services is growing significantly. And we anticipate that increasing global concerns for limiting greenhouse gas emissions and addressing climate change challenges will spur that demand. It also represents an opportunity to build on IRG's MARKAL modelling capabilities for broader application, both in domestic and international markets.

International Resources Group provides professional services in two main areas: general management and institutional strengthening services to public and private sector clients in the United States and around the world; and international development services to the US Agency for International Development, World Bank, Asian Development Bank, Inter American Development Bank and other donor agencies, governments and organizations.

Iran breaks oil output record: minister

Mr Gholamhossein Nozari oil minister of Iran announced that Iran produced 4.184 million barrels on Tuesday, shattering the record in the post revolution era.

Mr Nozari promised that the Iranian oil output would reach 4.2 million barrels per day by mid March 2008.

Mr Nozari said Azadegan oilfield would start early production, during which 25 thousand barrels would be produced daily.

Azadegan field, located 80 kilometre west of Ahvaz, the capital of southern Khuzestan Province, with a proven 33 billion barrel deposit, is the largest oil reserve found in the world in the past 30 years, is expected to start production sooner than due time on February 12th 2008. National Iranian South Oil Co is trying to put Azadegan field into operation and celebrate the flow of its oil in transmission lines.

Mr Seifollah Jashnsaz MD of NISOC said that “To this end, the setting up of an independent exploitation plant and a desalination unit, drilling of 12 wells in Azadegan field, and the laying of 130 kilometres of 24 inch pipeline extending from the region to Ahvaz have been planned.”

He added that the experts of NISOC and Petroiran Co are outlining a plan on the second stage of production in an attempt to lift Azadegan’s output to 50 thousand barrels a day.

New container terminal to be set up at Dammam Port

Arab News reported that a new container terminal will be established at King Abdul Aziz Port in Dammam at a cost of more than SAR 1 billion.

Mr Naeemibn Ibrahim Al Naeem director general of King Abdul Aziz Port said that “The project will be implemented on a build operate transfer basis. Studies have been completed on the new container terminal and tenders will be invited within a few months to implement the project, which is open to Saudi and foreign companies.” He added that the new terminal would increase the port’s total capacity from 1.5 million to 3.5 million units.

Mr Naeem said that the contract that was signed with Abdul Aziz Al Turki & Partners would cover renovation of 40% of the port’s 39 wharves. He added that “The remaining wharves are rented to the private sector.”

King Adul Aziz Port is Saudi Arabia’s second largest in terms of capacity and number of wharves.

Gulf GDP may soar threefold to USD 2.3 trillion by 2020 - Report

Khaleej Times reported that the nominal GDP of Gulf Cooperation Council countries is projected to soar threefold from USD 773 billion to roughly USD 2.3 trillion by 2020 at an average oil price of USD 70 per barrel.

Mr Kito De Boer MD of McKinsey & Company Middle East said that this enormous growth will raise the average per capita income in the region by over 80% from less than USD 20,000 to more than USD 35,000 in today’s prices.

He added that "Indeed, if prices are sustained at USD 70 per barrel by 2050, the GCC will have a combined GDP equivalent of Germany or Japan." Mr Boer said that if present trends are sustained, the accumulation of wealth in the GCC will be of dramatic global importance.

He added that "Looking ahead to the year 2020, trends suggest that the GCC will be unrecognisable compared to what it is today. Considering just oil income alone, the next 14 years will dwarf the past 14. At an oil price of USD 70 per barrel, oil export revenues will add up to USD 6.2 trillion by 2020 or more than triple the amount earned since 1992."

Iran foreign investment on upward trends

Mr Davood Danesh Jaafari minister of economy & finance of Iran said that USD 10.76 billion in foreign investment has been pumped into the Iranian economy, excluding the oil sector, in current Iranian calendar year beginning from March 21st 2007 to March 20th 2008.

Mr Jaafari said that the figure stood at USD 10.27 billion in the previous year. Referring to refusal of certain Chinese banks to render banking services to Iranian traders, he said that fluctuations might be observed in commercial transactions but what's of importance is growing trend of transactions.

Mr Jaafari conveyed that the volume of Iran's imports grew up by at least 7% in 2007 as compared to last year's figure of USD 41 billion.

Czech investors seek investment in Pakistan

Business Recorder reported that several investors from the Czech Republic are planning to visit Pakistan to get a first hand knowledge of business opportunities to kick starts a string of JVs with their Pakistani counterparts.

A 2 member delegation comprising Mr Michal Jirkovsky and Mr Marie Kahounova told Mr Mian Muzaffar Ali senior VP of Lahore Chamber of Commerce & Industry that their country had a large scope for Pakistani goods.

Mr Jirkovsky said that the current volume of trade between Pakistan and his country needed special attention and frequent exchange of delegations is vital for their bilateral trade. He also called for both chambers to play role in expanding the trade relations. He added that "The economic growth witnessed by Pakistan in recent years has impressed manufacturers and investors in the Czech Republic and they are now considering Pakistan the best place to invest. There is a need to work together to identify possible fields of co-operation and provide proper information to the business communities of both sides."

Pakistan's major exports to the Czech Republic include leather and textile products but these exports constitute a petty fraction of Czech's total imports of these commodities.

Pierlite opens Sharjah factory for lighting solutions

Khaleej Times reported that Australian company Pierlite has opened an AED 20 million factory in Sharjah Airport Free Zone to manufacture environment friendly street lights and waterproof lighting products.

Set on a 48,000 square metre area, with a manufacturing space of 5,500 square meters, the Sharjah factory has the facility to double its capacity in the future.

Mr Lalu Samuel MD of Pierlite Middle East said that it hopes to capture at least between 20% and 30% of the lighting market in 35 countries in the Middle East, North Africa and Mediterranean over the next 5 years.

Mr Samuel said that the factory, which also houses a design department and a photometric testing lab, will produce also produce flood lights and tools used for electrical works. It will also have a display area for outdoor lights. He envisions Pierlite to also have offices in the 5 other Gulf Co operation counties of Saudi Arabia, Bahrain, Kuwait, Oman and Qatar and in Egypt by 2012. He added that an expansion program involving acquisitions is also in the pipeline.

Mr Samuel said that Pierlite, which has been designing and producing light fixtures and components for the past 50 years, will soon launch here its T5 Streetlight fittings called Green Street, which reduces green house gas emissions. He added that "All Pierlite products are highly engineered and designed to enrich the urban atmosphere."

Pierlite Australia has bought 2 companies in Sharjah for the last 2 years. These included the Lighting Corporation Limited, which was bought for USD 200 million last month and the USD 50 million acquisition of light fittings firm Moonlighting.

Dana Gas and Sonatrach in cooperation talks

It is reported that senior officials from UAE's Dana Gas held talks with Algeria's national oil company Sonatrach and the Algerian ministry for energy & mines.

The meetings in Algeria form part of Dana Gas's strategy to invest and acquire strategic positions in existing natural gas projects and related industries across the MENA region and to develop new opportunities in the region's fast growing natural gas sector.

Lahmeyer wins consultancy contract on Egyptian barrage

MEED reported that Germany's Lahmeyer has signed an engineering consultancy services contract for the project to build a new barrage with a 32 MW hydropower plant at Assiut on the Nile.

The new barrage will be built 200 meters to 300 meters downstream of an existing barrage dating from 1902, which it will replace. The Reservoirs & Grand Barrages Sector of the Water & Irrigation Ministry is the client.

Under the contract, Lahmeyer will supervise the hydraulic model tests, carry out the detailed design of the project, prepare the tender documents and supervise the tendering and contracting of the project. It will also supervise construction and provide assistance to the environmental group working on the project.

The project will cost USD 542 million in total, with USD 270 million provided by German organisation Kreditanstalt fur Wiederaufbau.

Chinese output, imports and exports of SS in 2007

It is reported that stainless steel council of China special enterprises association has published statistics about the country's stainless steel output, imports, exports and consumption in last year.

Crude stainless steel output broke 7 million tonnes accounting for one fourth of the world's total. Total output recorded 7.206 million tonnes a YoY increase of 1.906 million tonnes or 35.96% YoY.

Output of CrNi steel reached 4.189 million tonnes accounting for 58.13% share, Cr steel 1.839 million tonnes accounting for 25.52% and CrMn steel 1.178 million tonnes accounting for 16.35% share.

In the meanwhile imports decreased and exports increased with higher self sufficiency rate. Import volume hit 1.698 million tonnes down by 32.08% YoY whereas export volume registered 1.303 million tonnes up by 44.78% YoY. Net imports totalled 395,000 tonnes including 204,000 tonnes of semi products and 115,000 tonnes of narrow plate. Net exports of HR sheet were 328,000 tonnes.

COSCO diverts ships for domestic coal transportation

It is reported that China COSCO Holdings Company Limited has diverted ships for domestic coal transportation as the country struggles with serious power shortages amid its coldest winter in a century.

COSCO Holdings said it had shifted the vessels from its international fleet, and was using 34 vessels to transport coal along China's coast. They had shipped about 3 million tonnes of coal from the northern producing areas to the south.

COSCO plans to increase further its capacity for coal transport to help relieve the fuel shortage in the south, where many power generators had been forced to stop operation.

Beijing has urged all parties involved, including coal mines and ports, to help solve the power shortages in the run up to the Lunar New Year.

Terra Nostra adds 310S grade SS to product line up

Terra Nostra Resources Corporation announced that its Chinese stainless steel JV Shandong Quanxin Stainless Steel Company Limited is now manufacturing continuous cast 310S grade stainless steel, with the first production order shipped in January 2008. This grade of stainless steel is widely used in the chemical, power generation, military and petroleum industries.

Mr Sun Liu James Po CEO of Terra Nostra's said "Introducing 310S grade stainless steel marks a further step in Terra Nostra's strategy to produce more high value products, thereby expanding the range of product grades we offer customers and increasing the mix of high margin, less price sensitive products. Given our continuous casting capability, this development also elevates our competitive standing among stainless steel producers in China.”

He added that “We now have a distinctive edge over many other domestic producers to meet the rapidly growing end user demand for high quality grades of stainless steel that is generally being met by imports. In addition, our investment in advanced production technologies places Terra Nostra at the forefront of cost efficient production that meets the latest environmental standards and gives us the platform to continue expanding our production to include round rod and welded pipe lines."

UMW’s pipe plant in China to be ready in 2008

It is reported that UMW Holdings Bhd expects its longitudinal submerged arc welded steel pipe processing plant in China's Qinhuangdao Economic & Technical Development Area to be ready by year end.

The steel pipe processing plant is being set up by Zhongyou BSS Petropipe Company Limited a 51:49 JV between UMW's wholly owned subsidiary UMW Petropipe Limited and Baoji Petroleum Steel Pipe Company Limited. The plant, which would have an annual capacity of 300,000 tonnes when ready would supply to the second phase of China's gas pipeline project.

Mr Abdul Halim Harun MD of UMW Holdings Bhd said the plant would be the biggest of the group's plants in China in terms of size and capacity. He said UMW planned to invite the Prime Minister to launch the plant later.

Mr Abdul Halim Harun said “The oil and gas industry is bullish now. It has great potential due to the high oil prices and a lot of investments by oil companies like Petronas. He said we should continue to perform better than last year in our four core businesses, especially in oil and gas and motor vehicle. He added that we study opportunities in this region. If it fits in with our business model, we will consider it.”

Baotou Steel profits in 2007 surge by 280% YoY

It is reported that Baotou Steel Rare-Earth Hi-Tech Company Limited profits increased by 280% to 320% in 2007 the net profit of 2006 was CNY 79.0586 million.

Baotou Steel Rare-Earth Hi-Tech Company Limited said the main reason for the profit is its imposed sales task in Q4, the sales income in Q4 was increased greatly.

Taigang produced 1.28 million tonnes of SS in 2007

It is reported that in 2007 Taigang saw great progress made on cold rolled stainless steel production.

In 2007, Taigang produced stainless steel 1.28 million tonnes in total, increasing 76.5% from that of 2006; including cold rolled sheet and plate 816,000 tonnes up by 31.9% with the same comparison.

Nanchang Changli 2007 profit surge by 160% YoY

According to the notice by Nanchang Changli Iron & Steel Company Limited, the company once revealed that the company may have a sale income of CNY 12.5 billion in 2007 up about 300% YoY from that of 2006 and realize net profit CNY 175 million up by 160% YoY.

The exact data will be shown in 2007 annual report that should be released on February 23rd 2008.

China Merchants Shipping 2007 net profit CNY 855.84 million

China Merchants Energy Shipping Company Limited said its unaudited net profit for 2007 stood at CNY 855.84 million up from audited profit of 813.41 million it booked in 2006.

The company said in unaudited figures filed with the stock exchange Operating revenue in 2007 reached CNY 2.39 billion. In 2006 it achieved operating revenue of CNY 2.41 billion.

The company will release the audited 2007 results on April 28th 2008.

China’s logistics flow in 2007 grows by 25.5% YoY

According to the estimates of the China Federation of Logistics and Purchasing in 2007 China’s total logistics flow in 2007 grew 25.5% to CNY 8 trillion.

Mr Lu Jiang chairman of the CFLP at a forum on international logistics cooperation in Beijing said that "Although the industry maintained stable development in 2007, competition from foreign peers will mount in 2008 and the domestic logistics sector will see increasing openness. He said that challenges facing domestic logistics enterprises, including insufficient information technology support and un advanced transportation methods.

ABB to supply electricals to Yunnan Alum mum

It is reported that ABB, the leading power and automation technology group has won a contract to provide a complete set of electrical equipment for a cold rolling mill project at the Yunnan Aluminium Company Limited.

ABB recently installed the world's most advanced continuous casting and rolling technology for aluminium processing, which uses SMS DEMAG Company and ABB technologies to achieve energy savings of 26%.

Mr Tobias Becker head of the Process Automation Division of ABB China and North Asia said "This order strengthens ABB's position as the leading supplier of electrical and automation systems to the steel and non-ferrous metal industry."

As per report this was the fourth order in China that ABB has won with SMS DEMAG. ABB has also provided power and automation solutions for the largest aluminium processing plant in Europe, run by Hydro Aluminium, helping to increase capacity by 15% and energy efficiency by 25%.

The ABB Group of companies operates in about 100 countries and employs more than 110,000 people. It has a variety of businesses in China including R&D, manufacturing, sales and service, with 12,000 employees, 25 JV and wholly owned companies and a sales and service network across 38 cities.

TMK to double premium class threaded production in 2008

Tubes Metallurgical Company announced plans to double production of casing and drilling pump and compressor pipes with threaded connections in Premium class to 24,000 tonnes in 2008 to strengthen its position in this market segment of oil and gas pipes.

Mr Konstantin Semerikov GD of TMK said "We have strengthened our position in the market for high-tech pipes. Our goal is to become a producer and supplier of specialized oil and gas grooved tubes with a full range of threaded connections class Premium.”

The production of pipes with threaded connections class "Premium" at the TMK increased from 5,500 tonnes in 2003 to 12,000 tonnes in 2007. By 2010, TMK plans to increase production capacity for pipe connections class "Premium" to 130,000 tonnes.

The target company sells "TMK - Premium Service", which is aimed at strengthening the position of TMK in the Russian and foreign markets of the high-tech products.

Ukrainian coke output in January up by 10% YoY

Millennium Capital reported that according to UGMK, Ukrainian coke producers increased coke output by 10% YoY to 1.8 million tonnes in January 2008 but down by 4.4% MoM.

In ‘000 tonnes
Change is YoY
Source Millennium Capital

In ‘000 tonnes
Change is MoM
Source Millennium Capital
* Millennium Capital estimates. (We do not have exact figures for December 2007, but deduce them from 2007 and 11M2007 results)

AES to sell interests in Kazakhstan power plant and coal mine

It is reported that AES has signed an agreement with Kazakhmys to sell its interests in AES Ekibastuz power plant and Maikuben west coal mine in Kazakhstan.

AES said that it will maintain its ownership and operation of other facilities located in eastern Kazakhstan, which include thermal and hydro generation capacity of approximately 2,688MW and a distribution business with over 400,000 customers.

As per the sale agreement, AES will receive consideration of USD 1.1 billion at closing and will have the opportunity to receive, over three years, additional consideration of up to USD 381 million under earn out provisions, a management fee and a capital expenditure program bonus, for a total consideration of up to USD 1.48 billion.

Mr Paul Hanrahan president & CEO of AES said "This transaction is a good example of how active portfolio management can create opportunities to increase value for our shareholders. At the same time, we will maintain an important presence in the growing Kazakhstan market."

ArcelorMittal Temirtau to appeal court ruling

Bloomberg recently reported that ArcelorMittal Temirtau is planning to appeal a court ruling in Kazakhstan that would force its local division to pay KZT 132.4 billion (USD 1.1 billion) in back taxes and fines.

The report cited Ms Nicola Davidson spokeswoman of ArcelorMittal as saying that "We do not see any justification for this ruling and intend to appeal the decision.”

A special interregional economic court on February 1st 2008 upheld the state tax committee's bill for the years 2002 through 2005. The amount consists of KZT 131.7 billion in taxes and KZT 695 million in fines,


Mr Shokan Araunov, a judge in the case, said that ArcelorMittal Temirtau has 15 days from February 1st 2008 to appeal.

Kazakhstan plans145 million tonnes coal output by 2020

Kazinform cited Mr Sauat Mynbayev Minister of Energy and Mineral Resources of the Republic of Kazakhstan as saying that "The Energy and Mineral Resources Ministry of Kazakhstan has worked out a coal industry development concept until 2020. In the nearest time we will forward it to the Parliament."

Mr Mynbayev added that "It will foresee coal mining increase in volume up to 145 million tonnes in 2020. It will take above USD 4 billion of investments."

ArcelorMittal Kriviy Rih net sales in 2007 up by 30.6% YoY

Ukrainian Journal Staff reported that ArcelorMittal Kriviy Rih has increased net sales by 30.6% to UAH 18.8 billion in 2007.

The report said ArcelorMittal Kriviy Rih production rose by 6% YoY to 7.2 million tonnes of pig iron, by 7.1% YoY to 8.1 million tonnes of crude steel and by 3.8% YoY to 7.1 million tonnes of commercial rolled products.

Mr Vitaliy Konopatsky economics director of ArcelorMittal Kryviy Rih said that the company plans to increase net sales by 15% in 2008 while making the domestic market a priority.

Transneft Siberian oil pipeline project to be delayed

Transneft, which manages the construction of an oil pipeline from East Siberia to the Pacific Ocean, said the project's commissioning would be delayed from late 2008 to late 2009.

Mr Nikolai Tokarev president of Transneft said "It seems it will be possible to complete work and commission the first stage of the ESPO project only in the fourth quarter of 2009, adding that the project's first leg was now only 46% ready, while according to the schedule it should have been 67% complete.”

Mr Tokarev said the harsh conditions in which the pipeline is being built, the delayed start to the project's implementation and the extension of the pipeline's route due to environmental concerns were the main reasons for the delay. He also said that some subcontractors had failed to meet their obligations on time.

The ambitious East Siberia Pacific Ocean pipeline is slated to pump up to 1.6 million barrels of crude per day from Siberia to Russia's Far East and then on to China and the Asia-Pacific region. The project's first leg, estimated at USD 11 billion was expected to be commissioned in December 2008.

Auction postponed for Yakutia coal deposit

Interfax reported that the Federal Subsurface Resources Agency has rescheduled the auction for the rights to the Malo Elginsky section of the Elginskoye hard coal deposit in Yakutia to from April 15th 2008 to April 29th 2008.

The regional natural resources department said that no reason was given for the postponement of the auction. The deadline for applications to bid in the auction has been extended until February 12th 2008.

The 25 year exploration and mining license to the Malo-Elginsky section of the Elginskoye deposit, with P1 and P2 anticipated resources of respectively 37.18 million tonnes and 11.443 million tonnes will be offered at a starting price of RUB 40 million with a bidding increment of 10%.

Ukrainian coal minister calls for increasing coal output

Ukrainian Journal Staff cited Mr Viktor Poltavets Coal Minister of Ukraine at the Lvivvuhillia state company in the Lviv region settlement of Sokal as saying that the priority for the Coal Ministry in the coming years is to increase coal extraction and wages for miners.

He said that the ministry plans to considerably increase coal extraction in the coming years. He said that in 2008, state mines would increase coal extraction to 47 million tonnes while in 2007 they extracted 42 million tonnes.

Gazprom and SUEK to form JV

It is reported that Russia's Gazprom and SUEK are to form a JV with an estimated value of USD 18 billion. The deal which will be completed by September 2008 has to be approved by Russia's Federal Anti monopoly Service.

A source close to the deal said that "The valuation of the joint venture falls between USD 12 billion and USD 18 billion, but I think it will be in the neighbourhood of USD 14 billion to USD 18 billion."

The venture will become Russia's largest electricity holding company after the break up of Unified Energy System. Gazprom and SUEK bought nearly a quarter of the assets sold by UES in 2007.

Coal miner raises USD 10 million loan from Korean Development Bank

Interfax reported that Kolmar holding company, which is involved in coal mining projects in Yakutia, received the first tranche of funding under a USD 10 million loan agreement with the Korean Development Bank.

Kolmar holding company said in a statement that the overall amount of project financing is planned at USD 300 million.

Kolmar is participating in the development of the Chulmakanskoyecoal deposit in southern Yakutia and is implementing a project to build the Inaglinsky coal complex with a mine and concentration plant with annual capacity of 3.2 million tonnes.

Kolmar has been working on the Inaglinsky project since 2006 and expects to achieve design capacity in 2010. The license property has reserves of more than 120 million tonnes of coking coal. It also involved in the project to build a mine at the Denisovskoye deposit in southern Yakutia and is mining hard coal at the Erel Chulmakanskoye deposit.

Komar's partners in the Erel joint venture are South Korea's LG and Yakutugol, a division of the Mechel steel and coal group.

Gazprom pushes for Sakhalin III geological prospecting

RIA Novosti reported that Russian energy giant Gazprom has requested the government's permission to prospect three natural gas blocks of the Sakhalin III project in the Far East.

Mr Alexander Ananenkov deputy chairman of Gazprom's management committee said at a meeting in Khabarovsk chaired by Mr Dmitry Medvedev Board Chairman that "We would like to resolve the issue of allowing geological prospecting at the Ayashsky, Odoptinsky and Kirinsky blocks of the Sakhalin III project by the end of the first quarter."

He added that the Kirinsky block had probable natural gas reserves of 930 billion cubic meters, while the Ayashsky and Odoptinsky deposits had reserves of 400 billion cubic meters.

The Sakhalin-III oil and gas project's estimated reserves in the Sea of Okhotsk total over 800 million tonnes of oil and more than 900 billion cubic meters of gas. The project includes the East-Odoptinsky, Ayashsky, Venin and South-Kirinsky blocks.