India approves National Mining Policy

India's cabinet has approved much awaited National Mining Policy for attracting investments by foreign and domestic companies in the country's mining sector. Now the government will introduce a bill to amend the Mines & Minerals (Development & Regulation) Act of 1957, MCR Rules of 1960 and MCDR of 1988 to give effect to the new policy.

A government spokeswoman said “The policy was given in principle approval by the Cabinet as recommended by the high level committee together with modifications on the basis of consultation with state governments, inter-ministerial consultations and in line with recommendations of the Group of Ministers.”

Under the new guidelines, foreign and domestic firms should find it easier to invest in the exploration and mining of gold, diamonds and metals like copper and zinc, and prospecting companies will automatically obtain a mining license.

The new policy will shorten the time it takes for new mining leases to be granted by state and federal governments to about six months to a year. After the period proposed in the policy, applications will be automatically referred to a tribunal.

Mr Deepak Sandhu a government spokeswoman, told reporters that the policy, which replaces a five decade old law, will help secure USD 250 million of investments annually by the end of five years.

The cabinet also gave its approval for setting up an independent dispute resolution mechanism Mining Administrative Appellate Tribunal.

TATA Steel eyeing Iranian chrome ore to feed SA plant

BS reported that TATA Steel is in advance stage of negotiations to procure chrome ore from Iran for its upcoming ferrochrome plant in South Africa.

Mr Dinesh Shastri executive in charge of ferroalloys & minerals division of TATA Steel said that “The talks are now beyond the primary stage to source chrome ore from Iran.”

He added that chrome ore from Iran would be used to feed its upcoming 135,000 tonne high carbon ferrochrome plant in South Africa.

Mr Shastri said that the South African ferrochrome plant would start production on March 31st 2008. He added that “Our plant at Richards Bay would begin production from March 31st 2008 as against earlier target of October 2007.”

TATA Steel’s initiative to source chrome ore is its second JV in Iran. In 2005, it had signed a JV agreement with Iran Mines & Mineral Industries Development and Renovation Organization for setting up a 1.5 million tonne steel slab making facility, a 1.5 million tonne steel billet making unit, a 3 million tonnes per annum export oriented steel plant and for exploration and mining of iron ore.

JSL board approves multi transactions

Jindal Stainless Limited has announced that its board of directors at its meeting held on March 13th 2008 has transacted the following

1) In order to reap the benefit of rising infrastructure and utility services sector and to promote the usage of stainless steel in this sector, Jindal board has resolved to promote a wholly owned subsidiary in India. The board has also resolved to invest up to an amount of INR 500 crore in this proposed subsidiary in next 2 to 3 years.

2) In order to have a focused approach for the acquisition of the mineral resources globally in countries like, Turkey, Indonesia, Vietnam and including India, the board of directors has also resolved to form a wholly owned subsidiary company in Singapore which will be a mining and metal company and will act as hub for acquisition of all mineral resources available globally as well as in India. The board has also resolved to invest up to an amount of USD 100 million in the proposed subsidiary in next 2 to 3 years.

POSCO doubts Indian steel dream

FE reported that according to the POSCO Research Institute India may not be able to add more than half its target of 100 million tonne of steel capacity by 2020 as the world faces a raw materials shortage and India has problems with land acquisition.

Mr Chang ho Kwang director of POSCO Research Institute said that there would be a lack of raw materials especially coking coal worldwide and India’s physical and social infrastructure poses another problem. He added that the top 10 global companies control over the 73% of the raw materials and their expansion would worsen the scarcity faced by smaller players.

POSCO, itself among the ten global steel majors, is facing hassles. Two years after signing a pact with the Orissa government, it is yet to get its mining lease and has managed to acquire only 300 of the 4000 acres it needs for the project, which was the single largest foreign direct investment in India.

But Mr Kwang said that POSCO will not pull out of the India project. He added that “For a player like POSCO, such delays have been a bad experience but we are not considering withdrawing our project from India.”

JSPL to start El Mutun iron ore shipment in October 2008 – Report

Steel Business Briefing reported that Jindal Steel & Power Limited could ship iron ore from El Mutun mines in Eastern Bolivia through the Paraguay River using the port facilities at Corumba.

As per report, JSPL is expected to begin shipments from its El Mutun operation later this year and is likely to ship its first ore cargo in October 2008.

As per report, Mr Pritam Singh Rana MD of JSPL Bolivia had visited Corumba's officials to discuss projects & investments at the river port.

In November 2007, Bolivia's government gave its approval for JSPL's USD 2.1 billion El Mutun project to develop iron ore deposits and build a 1.7 million tonnes per year direct reduced iron plant and a 1.4 million tonnes per year steelmaking plant.

Kalinga Nagar tense after firing incident

It is reported that a supporter of Visthapan Virodhi Janamanch was shot at from close range in Kalinga Nagar Industrial Complex on Thursday evening triggering tension in the area. He was attacked by unidentified miscreants.

With the news spreading like wild fire hundreds of agitated tribals blocked the highway.

Mr Rabindra Jarika general secretary of the Visthapan Virodhi Janamanch suspects that the miscreants are hired goons engaged by industrial houses. He alleged that the TATA Steel officials were behind the attacks and were adopting all sorts of methods to weakening the Janamanch agitation.

Eastern states should jointly develop steel industry – Experts

Speakers at 'Indian Steel – Focus East', organized by the Bharat Chamber of Commerce and Mjunction Services Limited, said that India’s eastern states need to cooperate with one another for proper development of the steel industry in the region. They agreed that the states of West Bengal, Orissa, Jharkhand and Chhattisgarh should cooperate with one another, instead of competing for raw materials like iron ore and coal.

Mr Chang ho Kwag director of POSCO Research Institute said that Indian steel industry has vast potential, but capacity expansion and implementation of new projects are facing problems. He added that “Most of these problems are related to local issues like land acquisition and rehabilitation, so there should be a consensus on these issues. Local people should be educated about the benefits which they will get from these projects.”

Mr Kwag said that companies should concentrate on their corporate social responsibilities in order to tackle these human issues. He added that “Before the implementation of the projects, local people should be taken into confidence. Unless this is done execution of the projects would be difficult.”

Mr Sunil Kumar industries director of Jharkhand government said that sharing of mineral resources with other states could be done through a proper policy framework and mutual consensus. He added that “A better future is possible only through cooperation.”

Meanwhile, Mr Vipin Vohra chairman of SPS Group said that the steel industry is suffering due to lack of infrastructure. He added that “States promise a lot during signing of MoUs, but fail to keep their promises later and many projects are pending due to this. Infrastructure should be created even before MoUs are signed.”

Indian shipping crosses 9 million gross tonne mark

BL reported that according to Indian National Shipowners’ Association, Indian shipping tonnage has crossed the 9 million gross tonne mark for the first time in history. In the beginning of 2008, Indian fleet comprised 839 ships with 9.03 million gross tonne. With the fleet acquisition plans by Indian companies, the fleet will cross 10 million gross tonne shortly and is estimated that by 2012, the tonnage required will be around 20 million gross tonne.

The growth of the fleet was sluggish during 2006-07 with 787 ships with 8.59 million gross tonne as on March 31st 2007 as against 739 ships with 8.46 million gross tonne on March 31st 2006. The age profile of the fleet in terms of gross tonne shows that over 42% of overseas fleet or 3.45 million gross tonne was over 20 years, while another 14.2% was between 15 and 19 years.

Mr S Hajara president of INSA said that with 4 million gross tonne to be scrapped during 2008-12 period, a net addition of 15 million gross tonne involving an investment of around USD 20 billion is required to meet this target. As on October 2007, the average age of Indian fleet was 18 years.


The outlook for the fleet strength remains positive with the continuing firm trends in the freight market and creation of funds through mandatory provision transfer of 20 per cent profits to the tonnage tax reserve for acquisition of ships.

Orissa opposition walks out over Vedanta project

FE reported that Vedanta Resources alumina project in Orissa's Kalahandi district got a lot of flak from the opposition in the state Assembly as the opposition parties staged a walked out after leveling the serious accusations.

They are reported to have alleged that Vedanta Alumina Limited's plant is running in violation of Supreme Court directives and the company is allowed to run the plant against court orders due to kickback involved in the deal.

The report cited Mr Narsinhga Mishra of the Congress as saying that the Supreme Court has expressed its doubt on the credibility of Vedanta Alumina Limited. He added that "It is a company that is not to be trusted." According to Mr Mishra, the Supreme Court said that Vedanta is not a subsidiary but an associate company of Sterlite Industries India Limited. But, he said, the chief minister misled the people of the state by saying that Vedanta is a subsidiary of Sterlite.

However, Mr Pradip Amat steel & mines minister of the state said that the refinery at Langigarh in Kalahandi district is not running in violation of the Supreme Court's order. According to him, the court said in its order that if Sterlite, Orissa Mining Corp and the state government jointly agree to comply with the rehabilitation package laid down, the court may consider granting clearance to the project.

Vedanta's project is likely to face further trouble as AICC general secretary Mr Rahul Gandhi has made it clear that he is against the project, so the opposition Congress is getting ready to launch a campaign against it.

Sterlite, meanwhile, has filed applications in the Supreme Court confirming its agreement with the stipulation of the court.

HEC to come out of BIFR by May

Heavy Engineering Corporation has announced that it will be out of the Board of Industrial & Financial Reconstruction net by April or May 2008 and become a positive net worth company to pave the way for diversifying in new areas.

Mr GK Pillai CMD of HEC said that "We will become a positive net worth company by May 2008 after two decades from the current negative net worth of INR 700 crore as of last fiscal. We have finalized a deal with the Jharkhand state government to set off the company's electricity, water and other dues against 2,140 acre and some buildings of HEC."

Mr Pillai said that HEC is expecting to get the money in April or May 2008 and would utilize it to write off dues and use INR 250 crore for modernization and working capital of the company.

HEC is aiming to cross the INR 410 crore turnover in the current fiscal and INR 1,000 crore in 2008-09. It hoped to post INR 10 crore net profit in 2007-08 against INR 2.86 crore in the previous fiscal.

Mandi steel makers facing entry tax imposition

It is reported that many steelmakers in Punjab are bearing the brunt after the state government has imposed an entry tax of 4% on all goods brought in the state. As per report Mandi Gobindgarh, the steel cluster of Punjab is rusting and also about 350 small and medium units in the town are languishing due to excessive tax burden coupled with the frequent revision of steel prices.

Mr Ravi Kant Sharma of RK Steel & Alloys said that there has been a burgeoning demand for TMT steel in Punjab due to rise in construction activity. He added that “Due to the trend of setting up shopping malls, multiplexes and marriage palaces in big and small towns of Punjab, the demand for TMT steel has increased manifold in the region. Unfortunately, we have not been able to cash in on it because of the adverse scenario prevalent in the state.”

The entrepreneurs expect some relief in the budget to be presented by Mr Manpreet Singh Badal finance minister of Punjab in the next week as the elimination of steel industry in Punjab would make a dent on revenue and employment in the state’s economy.

There are about 300 steel re rolling mills and about 70 induction furnaces in the town and most of them are operating on sub optimal capacity. In the past few months, about a dozen players from Mandi shifted near the source of iron and coal in the eastern part of India and the consistent revision of price would make most of the units unviable.

RITES to upgrade railway infrastructure in Namibia

It is reported that RITES has signed a MoU with TransNamib Holdings for upgrading railway infrastructure in Namibia.

Under the agreement, RITES will provide assistance and expertise in upgrading and rehabilitation of existing railway and other infrastructures including train control system using GPS based technology, rehabilitation of old locomotives and supply of new cape gauge rail cars, technical and managerial assistance, advisory services for public private partnership and training for commercial and operating staff.

Indian Railways new production units in the 11th Plan

Mr R Velu minister of state for railways said that Indian Railways has obtained approvals to set up the following new production units in 11th Plan.

The details are as follows

Cost in INR crore
Capacity per annum
* The plant is expected to be functional in 11th Plan

While presenting the Railway Budget 2008-09, it has been announced that a new rail coach factory will be set up in the state of Kerala to meet the requirement of passenger coaches in India. At present there is no production unit in Andhra Pradesh.

Indian firms plan to acquire coal mines in Mozambique

Mr Dasari Narayana Rao union coal minister said that Indian state owned power and mining companies plan to acquire foreign coal mining rights, particularly in Mozambique.

Mr Rao said that NTPC, Steel Authority of India Limited, NMDC, Rashtriya Ispat Nigam Limited and Coal India Limited would set up a JV to acquire foreign assets. He added that, aside from the JV, CIL planned to independently acquire foreign coal mines.

Tuticorin Port cargo handling crossed 20 million mark

Exim News Service reported that Tuticorin Port has reached another milestone when it crossed the 20 million tonne mark on March 10th 2008.

Tuticorin Port has handled 20.07 million tonnes till March 10th 2008 up by 20.03% YoY as against 16.72 million tonnes handled till March 10th 2007. This record cargo traffic was possible due to the increased handling of fertilizers nominated by the government, containerized cargo and industrial coal through anchorage operations and thermal coal handled by the Tamil Nadu Electricity Board.

If this trend continues, Tuticorin Port will easily cross union shipping ministry’s target of 20.385 million tonnes fixed for 2008-09 by the middle of March 2008 and may even cross 21 million tonnes by March 2008 end.

Mr K Suresh chairman in charge as well as Mr A Subbiah deputy chairman of Tuticorin Port Trust have congratulated the workers and officers of the Port and all other stakeholders responsible for the remarkable performance.

NTPC to invest INR 13000 crore for 2,700 MW in 2009

BL reported that, as part of its ambitious plan to become a 50,000 MW company by 2012, National Thermal Power Corporation Limited will invest INR 13,000 crore for adding 2,700 MW capacity during the next financial year.

Mr T Sankaralingam CMD of NTPC said that "Our spending plan is INR 13,000 crore for 2009 fiscal to add 2,700 MW capacity. The funding would be a mix of equity and debt in 30:70 ratios. Our spending plan for 2008 was INR 11,000 crore."

J&K to get world’s highest rail bridge by 2010

It is reported that the 359 meters tall bridge is coming up over the Chenab at Kauri for linking Udhampur to Qazigund by rail in Jammu & Kashmir will be completed by 2010 to become a record as the highest railway bridge in the world.

Under construction since March 2007, the viaduct would be trussed steel arch with a span of 480 meters. The bridge would require 26,000 tonnes of steel.

Mr Vinod Kumar executive engineer of Konkan Railway Corporation, who is working on the Chenab Bridge, said that the bridge would be 359 meters high, 1315 meters long and will cost around INR 512 crore.

He added that "The construction has been a challenge. We had to first build a 118 kilometer long road to reach Kauri, which was inaccessible. Height of the Chenab Bridge will be 5 times the height of the Qutub Minar and 35 meters higher than the Eiffel Tower. More than INR 100 crore has been spent on the bridge so far. We have constructed 8 giant concrete pillars while 7 others are under construction."

Konkan Railway Corporation is facing difficulties in meeting the target date due to geological conditions. Extra care is being taken as the area falls under an active seismic zone. Wind speed, which can go beyond 100 kilometer per hour, too proves dangerous. The bridge would be fitted with special equipment to measure wind speed, seismic vibrations, and temperature to prevent any dangerous situation when it’s opened for traffic.

Monnet Cement Raipur to commence by September 2008

BS reported that Monnet Cement is likely to commence civil work of its cement unit in Raipur district of Chhattisgarh by September 2008.

As per repot, the proposed cement unit, with a capacity of 2 million tonnes per annum, will entail an investment of around INR 450 to INR 500 crore. The project will also include a power unit.

Monnet Cement is in the process of acquiring 200 acres of land for the project and orders for machinery is likely to be placed by April 2008. Mine survey work is underway and the project is awaiting necessary approvals from the government. Full completion of the project is expected within 3 years.

Orissa to sell power to other states after 2012 – Report

Orissa government has announced that an additional 33,000 MW of power would be generated in the state by 2012 and about INR 150,000 crore would be invested for transmission systems for sale of surplus power to other states.

Mr Surya Narayan Patro energy minister of Orissa said that "Of the 33,000 MW, extra power targeted to be generated by 2012, around 17,000 MW will be produced by 13 independent power projects for which MoUs have been signed and the rest by public sector units like NTPC."

He added that Orissa would require only 4,000 MW to meet its projected internal demand and the remaining 7,000 MW would be sold to other states facing power scarcity. As a result the total volume of power to be evacuated from the state, including the electricity to be directly sold by generating companies, would be of the order of 29,000 MW.

Stating that Orissa would get about 11,000 MW from generating companies as per agreements signed, Mr Patro said that the remaining 22,000 MW would be sold to buyers outside the state for 6 paise per unit of power.

He added that Power Grid Corporation of India Limited would invest nearly INR 150,000 crore for the transmission system for supplying surplus power to other states.

Emco bags INR 92 crore order from Jharkhand

Emco has bagged INR 92 crore orders for supply, erection, testing and commissioning of 400 KV of double strung transmission line on turnkey basis from Jharkhand based Corporate Power Limited.

Recently Emco bagged INR 325 crore orders from Maharashtra State Electricity Transmission Company for setting up three power substations.

CIL inks JV with TATA Power for 12 MW power unit

It is reported that Coal India Limited is likely form a 40:60 JV with TATA Power for producing power from waste methane gas emitted from coal mines. The power unit will have a capacity of 12 MW.

CIL and TATA Power will contribute the total planned equity capital of INR 50 crore in the same proportion.

Augmentation of coach production capacity

Mr R Velu minister of state for railways said that the annual installed production capacities of Integral Coach Factory and Rail Coach Factory are being augmented from 1000 coaches to 1500 coaches per annum, each respectively. The production will be 3000 coaches per annum after augmentation.

It is estimated that Bharat Earth Movers Limited can additionally manufacture approximately 450 to 500 coaches per annum. Further, supplementing the acquisition of coaches by way of outsourcing some electric multiple unit, main line electric multiple unit and diesel multiple unit coaches is also planned.

A new coach manufacturing unit is being set up at Rai Bareilly with a manufacturing capacity of 1000 coaches per annum. In addition, to meet requirements beyond this level, it has also been announced to set up a new rail coach factory in Kerala in the Railway Budget 2008-09.

Tamil Nadu to set up Power Transmission Corporation

It is reported that Tamil Nadu government has decided to create a transmission corporation to link the proposed merchant power projects with the power grid. The power from these facilities will have to be supplied to the Northern and Southern states.

Chairman of Transmission Corporation will be the chairman of the Tamil Nadu Electricity Board and the board's chief engineer will act as its MD.

Stone laid for integrated renewable energy farm

Mr Sushilkumar Shinde union minister for power has laid the foundation stone for Gurgaon based RS India Group's integrated renewable energy farm at Patan in Satara district near Pune.

The project to be implemented in phases will entail an investment of INR 700 crore. Phase I of the project, for which 1,400 acres of land has been acquired, will have an installed capacity to generate 100 MW wind power, 5 MW of solar power and extract bio diesel from Jatropha plantations on 225 hectare. The second phase of the project will involve adding installed capacity of another 200 MW of wind energy and planting Jatropha on 225 another 225 hectare.

The project will be financed with lease financial assistance of INR 487 crore by the Power Finance Corporation.

RS Group is investing INR 100 crore and Power Trading Corporation has a 37% equity participation in the new company formed for the purpose called RS India Wind Energy amounting to INR 54 crore.

BHPB bid for Rio – JISF seeks FTC review

It is reported that The Japan Iron and Steel Federation has asked Japan's trade watchdog to review BHP Billiton Plc's proposed merger with Rio Tinto Plc and its potential impact on the iron ore and coal market.

Hoping to safeguard Japanese steel makers' negotiating leverage with natural resources giants, the Japanese steel industry group said it has asked the Fair Trade Commission to take necessary steps to ensure that a fair competitive environment in iron ore and coal trading is maintained.

The federation in a statement said that BHP's takeover of Rio Tinto, if successful, would reduce competition among the suppliers and possibly hamper fair pricing.

A steel federation spokesman said the group is asking Japanese trade authorities to come up with data showing the proposed merger's impact on the Japanese market and to cooperate with other countries concerned to take appropriate action. He added that the federation didn't give a deadline for the Fair Trade Commission's response.

While Japan's Fair Trade Commission has no jurisdiction over matters outside the country, Mr Hajime Bada chairman of the federation last month said that his group would propose that the trade watchdog consider approaching its Australian and European counterparts and encourage them to probe the BHP Rio Tinto pairing over competition issues.

The latest move by the industry group echoes opposition to the mining giants' merger from the International Iron and Steel Institute and regional steel industry groups. The European Confederation of Iron and Steel Industries, the leader in the global steel sector is also asking the European Commission to oppose the merger, which would give the combined company a share of nearly 40% in the iron ore market.

Nucor Yamato introduces deepest US manufactured beams

Nucor Corporation announced that Nucor Yamato Steel Company is introducing 44 inch deep wide flange structural shapes thus becoming the first mill in the Western Hemisphere to produce sections at this depth. Until now, the deepest sections available from US mills had been Nucor Yamato's W40x431 sections.

Nucor Yamato Steel Company is introducing four 44 inch deep sections in following sizes
1. W44x335
2. W44x290
3. W44x262
4. W44x230
The maximum length for these sections is 120 feet long. The first production rolling of the W44 sections is scheduled for the week of May 25th 2008 and will be included in future rolling schedules.

These beams are of particular interest to the highway bridge market for use as stringers or primary bridge beams, horizontal load carrying members that carry the bridge deck and roadway surface.

Nucor Yamato Steel Company is a JV between Nucor Corporation and Japan's Yamato Kogyo Company.

ArcelorMittal files lawsuit over Wabush mine sale

ArcelorMittal announced that it has commenced a legal action in the Ontario Superior Court to require US Steel Canada Inc and Cleveland Cliffs Inc to respect their commitment and comply with the sale of their respective interests in the Wabush Mines joint venture to ArcelorMittal Dofasco.

As per release US Steel Canada and Cleveland Cliffs agreed to sell their interests in the Wabush Mines joint venture to ArcelorMittal Dofasco in accordance with the terms of an agreement made last August.

In a surprise move, Cleveland Cliffs and US Steel Canada issued press releases on March 4th 2008 dismissing their binding legal obligations with respect to the sale.

Mr Juergen Schachler president of ArcelorMittal Dofasco said that "Everyone fully understood the terms of this agreement. Our decision to pursue legal action is done in an effort to expedite the closure of the sale, and provide some much needed certainty for the employees at Wabush as well as the community and government stakeholders.”

Brazilian steel mills well positioned in 2008 - Fitch

Fitch Ratings said that Brazilian steel producers should maintain high profit margins relative to their global peers during 2008, against the backdrop of rising iron ore prices.

Fitch in a report said that Brazilian steel companies enjoy important competitive advantages, including modern production facilities, proximity to iron ore sources and a highly concentrated domestic market, which limits price based competition. It said that the sector also benefits from barriers to entry for imported steel due to the logistical challenges of transporting steel to and within Brazil, as Brazilian steel producers own or have privileged access to large steel distributors.

Fitch said that producers that are not backwards integrated into coal or iron are facing margin pressure in 2008 as coal and iron ore prices are expected to rise by nearly 100% and 65% respectively. Non integrated steel producers are also under pressure due to high prices for energy and metallic inputs.

Fitch said that globally, steel producers are counting on high demand for steel products and low inventory levels to enable them to pass price increases on to customers to maintain profit margins. If steel demand in Brazil meets expectations, producers may be able to obtain further price increases later on in the year. However, should global prices slide and trade become more difficult, Brazilian companies could be challenged to match 2007 profit margins as about one third of the country's total steel sales volume comes from exports.

Vale seeks partners for pellet plant in Malaysia

Reuters reported that Brazil's mining giant Vale plans to build a plant in Malaysia with a capacity to produce between 6 million tonnes and 7 million tonnes a year of pellets from Brazilian iron ore.

Mr Jose Carlos Martins executive director for ferrous metals of Vale during the CRU World Steel Conference in Rio de Janeiro said that Vale was looking for partners for the Malaysian venture. He said that "We are in discussions with a client in Malaysia. There is a lot of direct reduction of iron ore there and it's a natural market for pellets, adding that it would be the Asian country's first such plant.”

He told reporters that "Malaysian consumption today is 4 million tonnes, but it's going to grow a lot more. We're negotiating and have the intention of building the plant.”

Nippon and JFE Steel could win Thailand BF project

JMB quoted Mr Suwit Khunkitti deputy prime minister and minister of industry of Thailand at press conference in Tokyo on Wednesday as saying that Nippon Steel and JFE Steel are in better position to be selected as investor for new blast furnace project in Thailand.

Mr Khunkitti said that Japanese steel makers are well better position than Baosteel and Arcelor Mittal for the project when Thai government emphasizes technology level to make high valued steel, long term business experience for downstream operations, local customer base including transplants of Japanese automakers and environmental technology.

Indonesian miners urge local control of Koba Tin

Reuters reported that local miners in Indonesia's main tin producing islands have urged the regional government to seize control of PT Koba Tin, the country's second biggest smelter for the benefit of the local community.
Mr Abdullah Haimi chairman of the Central Bangka community forum which represents miners after meeting with the Central Bangka legislative council told reporters that "Koba Tin has contributed little to the community. They don't build hospitals or schools. Therefore, we ask that the firm's management be changed. If necessary, the local government should control the company.”

Koba Tin, which expects to produce 15,000 tonnes of refined tin this year, has had several clashes with the local authorities on Indonesia's Bangka Belitung islands.

Malaysia Smelting Corp Bhd owns 75% of Koba Tin, while the rest is owned by Indonesia's state owned PT Timah TINS.JK, the world's largest integrated tin miner.

As Indonesia seeks to step up control over its natural resources, Jakarta wants several international mining firms, including Newmont Corp and Freeport McMoRan Copper & Gold to speed up divestment of their stakes in their Indonesian mining ventures.

Cerrejon to boost coal output to 31 million tonnes in 2008

Dow Jones reported that Cerrejon LLC, Colombia's largest coal producer, is likely to produce 31 million tonnes of coal for export in 2008 up from 29.7 million tonnes in 2007.

Mr Leon Teicher CEO of Cerrejon told Dow Jones Newswires on the sidelines of a presentation of the company's social projects that the open pit mine located in the Guajira province in the northern tip of Colombia earned USD 1.5 billion from the sale of coal in 2007.

He said that it is difficult to estimate what the company's revenue will be in 2008. It depends on the coal price. If the price rises, it might reach USD 2 billion, but we don't know.”

Mr Teicher in an interview in July said that Cerrejon plans to invest USD 600 million to boost production to 42 million tonnes a year by 2011. He added that the mine would produce 32 million tonnes in 2008.

Australian coking coal exports in Q4 up by 2.9% YoY

The Australian Bureau of Agricultural and Resource Economics said that Australian thermal and metallurgical coal export volumes rose in the Q4 of 2007 compared with the Q3 of 2007.

Abare in its quarterly mineral statistics report said that metallurgical coal exports increased by 2.9% in Q4 to 35.69 million tonne. The export value of this grade was AUD 3.31 billion down by 1.5% QoQ and 11% YoY.

Thermal coal exports of 28.59 million tons gained by 3.6% QoQ and were up by 1.3% YoY. The AUD 1.79 billion value of these exports was up by 5.9% QoQ and rose by 5.3% YoY.

ABARE citing transport and port problems said that "Growth in the volume of Australia's black coal production and exports continues to be limited by infrastructure constraints.”

BHPB probing fire at Nelson Point iron ore terminal

BHP Billiton Ltd said that a fire broke out at a facility in its Nelson Point iron ore terminal at Port Hedland in Australia but was extinguished in less than one hour with no injuries to staff.

A BHP Billiton spokeswoman said that the fire started at 1425 local time in the lump screening area at the Nelson Point port facilities on the Port Hedland harbor before being extinguished by fire crews after about 45 minutes. Only one of two lump screening facilities was impacted by the fire.

She said that "There were no injuries or evacuations but it is too early to say if there will be an impact on production.”

She added that the cause of the blaze is under investigation.

Vietnam plans to become 4th largest ship builders by 2015

VNA reported that Vietnam has been listed as one of the top five shipbuilders in the world by Fairplay magazine.

Mr Pham Thanh Binh president of Vietnam Shipbuilding Industry Group said that the country's shipbuilding sector is on track to becoming the fourth largest in the world by 2015. He said the industry has never had such bright prospects and cites the delivery of two 53,000 tonne ships to the United Kingdom in June last year as Vietnam's passport to the world market.

However, Mr Nguyen Quoc Anh general director Vinashin of said that while the company has now made its initial 2015 target to be the fifth biggest shipbuilder in the world, there are still some issues that need to be addressed. He added that currently, only about 30% of the materials and services required to build ships comes from Vietnam. The industry has to import most of the materials and engines and uses international consultants and supervisers on building projects.

Vinashin now has almost 200 shipyards nationwide and the capacity to build oil tankers greater than 300,000 tonnes. It has received orders to build ships worth about USD 6 billion, including USD 4 billion from countries with advanced shipbuilding technology such as the UK, Japan, the Netherlands and Germany. This year, Vinashin's subsidiary Pha Rung Shipbuilding Company began construction of a 13,000 DWT oil tanker for a Greek partner. Nam Trieu Shipbuilding Company also won a USD 280 million contract to build four car carrying ships, one of which is now under construction.

Kazakhmys denies receiving takeover proposal

Kazakh copper producer Kazakhmys plc said it had received no takeover proposal from rival Eurasian Natural Resources Corp, which said the previous day it might be interested in buying Kazakhmys.

It said "Kazakhmys notes the announcement made by Eurasian Natural Resources Corporation Plc. No proposal has been received by Kazakhmys.”

ENRC had announced that it had held preliminary talks with Kazakhmys. ENRC said “t held discussions with Kazakhmys as it explored possible strategic opportunities following ENRC’s London flotation in December.”

PMA welcomes increase in US steel imports in January

According to Mr William E Gaskin president of Precision Metalforming Association the first increase in monthly steel imports in US during January 2008 reported since October 2007 is good news.

Mr Gaskin however said that US manufacturers are very concerned about rising steel prices and low inventory levels and noted that January 2008 overall imports were still 10% YoY lower than January 2007 imports and imports of hot and cold rolled sheets were down 18% YoY compared to January 2007.

Mr Gaskin said that "PMA members are reporting that steel supplies are extremely tight and that the price of steel continues to climb and in fact may reach record levels by mid year. According to the Metals Service Center Institute, inventories of flat-rolled carbon were only 2.7 months in January, a very low level, which raises a serious threat of spot shortages, quality issues and continued higher prices. An increase in steel imports is needed over the next several months to bring balance to the US steel market. Our message to Washington DC is the following: If policymakers want to stop the decline of the manufacturing sector, they need to ensure that US companies have access to competitively priced raw materials to compete in the global marketplace."

According to preliminary data issued today by the US Department of Commerce, overall steel imports increased by 33% MoM from 1.81 tons in December 2007 to 2.41 million tons in January 2008. Steel imports were 10% below January 2007 levels when total steel imports reached 2.67 million tons. Imports of hot rolled steel, the product used most frequently by metalforming companies, rose by 24% from December 2007, to 220,482 tons in January. Cold rolled imports also climbed in January, up by 31% from December 2007 to 130,484 tons.

The Precision Metalforming Association is the full service trade association representing metalforming industry of North America the industry that creates precision metal products using stamping, fabricating and other value added processes. Its nearly 1,200 member companies include metal stampers, hot rolled fabricators, spinners, slide formers and roll formers as well as suppliers of equipment, materials and services to the industry.

Antam to finalize Herald bid

Reuters reported that Indonesia's state owned mining firm, PT Aneka Tambang Tbk ANTM.JK expected to finalize a bid for Australian miner Herald Resources Ltd and acquire other gold assets this year.

The report quoted Mr Dedi Aditya Sumanegara president of Antam at the Reuters Global Mining Summit as saying that an expected firm nickel price this year would help raise sufficient funds to finance its acquisition plans. He added that "Our strategy this year is to complete our M&A program.”

Mr Sumanagara said that “Nickel prices are likely to remain good this year which will help us to have strong cash.” He added that nickel prices may remain firm in 2008 at around USD 14 per pound although it would be lower than USD 16.2 per pound in 2007 on concern that global economic worries may dent demand from stainless steel makers.

Macmahon wins USD 65 million Rio Tinto rail contract

It is reported that Macmahon Holdings Limited has been awarded a USD 65 million contract to construct a 50 kilometer rail for a Rio Tinto Limited subsidiary. The mining and construction contractor said the contract built on the company’s pre existing construction contracts with Rio.

Macmahon said that it would build approximately 50 kilometers of rail to the Mesa A mine for Robe River Mining Co Pty Ltd in the Pilbara Region of Western Australia.

The Mesa A project includes the construction of a 47 kilometer extension to the existing Deepdale rail line to the new mine site at Mesa A, together with an additional three kilometer rail siding at Churdy Pool. The Mesa A project is expected to commence in July and has an estimated completion date of May 2009.

Macmahon is currently executing a civil construction contract at Rio Tinto Iron Ore’s Cape Lambert port facilities near Karratha.

Nippon Steel raises the H beams price

Japanese’s Nippon Steel Corp has announced to raise the domestic H beams price of March by JPY 10,000 per tonne and the H beams price has risen by JPY 12,000 per tonne in February 2008. Therefore, the company total increased the price of H beams by JPY 22,000 per tonne up to now.

Nippon steel indicated that the price has risen due to the cost increasing for raw materials, freight, and scrap price. Also, they predicted the iron ore and coke price would rise substantially this year.

(Sourced from YIEH.com)

ArcelorMittal tells EU court emissions rules not fair

Bloomberg reported that lawyers for steel giant ArcelorMittal have told Europe’s highest court that there’s no justification for EU lawmakers to exclude the aluminum and chemical industries from 2003 legislation that capped CO2 emissions and that the exclusion puts the steel sector at a “complete disadvantage.

According to an EU lawyer, the idea behind the exclusion was to start by including those sectors primarily responsible for CO2 emissions. The steel sector had six times more emissions than the chemicals industry. In addition to steel, industries covered by the existing rules include electricity, paper and cement.

The Advocate General will publish nonbinding legal advice by May 21st 2008. The court is expected to rule within the following six months.

ArcelorMittal recently also announced that it will collect and report the carbon dioxide emissions data of steel plants in all the major steel producing countries.

Union rejects Sidor's offer and plans more strikes

BNamericas reported that Venezuelan steelworkers union Sutiss has rejected a pay raise offered by local steelmaker Ternium Sidor.

A Sutiss spokesperson told BNamericas that "We don't think it's a fair offer. Now we are considering new stoppages at the plant for longer periods of time.”

As per report this week, Ternium Sidor offered the company's employees a pay increase of USD 20.52 per day raising the basic monthly salary from VEB 1,240 to VEB 2,572 up 107% over current pay.

The spokesperson also said that a committee of employees will travel to Caracas to meet with President Hugo Chávez so that he decides what steps to take next in this situation.

Employees have been carrying out strikes and protests to pressure for a salary increase that the union initially demanded at VEB 80 (USD 37) per day but later dropped to VEB 68. Each stoppage at Ternium Sidor generates losses of USD 7 million per day not considering the cost of firing up the plant again. The company has capacity of 4.2 million tonne per year of liquid steel.

Taiwanese steelmakers plan to lift competitiveness

The president of Taiwan’s China Steel Corp said on March 10th 2008 that the company is willing to cooperate with Formosa Plastics Group and E United Group in Vietnam steel market.

The possible project can help them defend against foreign competitors. The general manager of Formosa Heavy Industries Corp said that Vietnam has already become one of world’s most attractive foreign direct investment destinations and they are very welcome CSC’s joining.

The president of E United also gave a positive response to this issues, he said that they will not reject any possibility to cooperate with CSC or FPG.

According to the news reported that the general manager of Formosa Heavy Industries Corp and E United’s management had visited CSC to discuss about the future cooperation in Vietnam after Chinese New Year.

(Sourced from YIEH.com)

BHPB denies HQ shift to Perth

BHP Billiton has denied a media report it is planning to shift its global headquarters from Melbourne to Perth by 2012, saying speculation was based on the fact it was consolidating its two Perth offices into one.

A BHP spokeswoman told Business Spectator:"Our head office will remain in Melbourne. This is an old rumor, based on the fact we've currently got two Perth offices that we're consolidating into one, big Perth site to house our Perth-based iron ore, stainless steel materials and petroleum staff."

According to The Age, the Lord Mayor of Perth Ms Lisa Scaffaldi said the world's biggest miner is planning to sever its 123 year-old link to Melbourne to head across the Nullabor. She was quoted as saying that "BHP will be headquartering in Perth, and their Melbourne operations will be significantly downgraded.”

But in a statement on the City of Perth website, Ms Scaffaldi qualified her statement with the use of the word effectively. She said "The fact that BHP Billiton has chosen to house its Perth staff in the 46 level tower is indicative of the confidence this major company has in Perth and the strength of the Western Australian mining sector."

Rio Tinto Alcan and SA in discussions on Coega smelter project

Rio Tinto Alcan announced that it is in discussions with the South African government regarding the timing of the Coega smelter project near Port Elizabeth in South Africa. A team, consisting of members from government, Rio Tinto and Eskom are reviewing the terms of the project in order to align its timing with the availability of secure power generation capacity from Eskom.

Mr Dick Evans CEO of Rio Tinto Alcan and member of the Rio Tinto Board said that "We are committed to working closely with the South African government to assist in mitigating the current energy crisis, while maintaining the option for future long term development of the Port Elizabeth region.” He added that “Rio Tinto has operated successfully in South Africa for several decades, and we look forward to continuing our mutually beneficial presence in the future.”

Rio Tinto Alcan will work with the government to minimize the impact of a potential rescheduling on regional economic development. Mr Sandeep Biswas senior vice president business development of Rio Tinto Alcan said that "We will continue working on our local community and social investment plans and remain committed to finding solutions that will lead to the development of this project. The objective is to preserve the feasibility of the project and its underlying benefits for both Rio Tinto and South Africa, having the long term picture in mind.”

The project is moving into an interim phase pending the outcome of ongoing discussions regarding the timing of the project. As the detailed feasibility study is concluded, the project team will be adjusted for this interim phase as appropriate.

A long term energy agreement for the proposed smelter was signed with Eskom in November 2006 and an agreement for infrastructure and job training support was concluded with Coega Development Corporation in July 2007. The Industrial Development Corporation of South Africa is a 15% partner in the project. An additional ownership allocation, of no less than 5% has been reserved for Broad Based Black Economic Empowerment partners.

Two men drown in illegal coal mine in Vietnam

VNS reported that two men were found dead in an illegal coal mine in the city of Ha Long in Quang Ninh Province of Vietnam last Sunday.

As per report Mr Khong Van Quy and Mr Nguyen Van Vu drowned while pumping water out of the illegal mine in Cao Xanh Ward.

Gerdau to expands steel supply

Purchasing.com reported Brazilian Steel Giant Gerdau will spend USD 6.4 billion to expand steel production by 14% to 28.3 million tonnes by 2010.

As per report Gerdau also plans to use its 1.8 billion tonnes of iron ore reserves to produce enough iron ore to supply 80% of its needs by 2010, minimizing its reliance on iron ore producers.

Cape Lambert H1 loss narrows to AUD 0.9 million

Thomson Financial reported that Cape Lambert Iron Ore Ltd posted a narrower H1 loss of AUD 0.9 million against AUD 3.3 million in 2007, despite a decline in revenues, as administrative expenses were lower.

As per report Cape Lambert recorded income of AUD 1.24 million from the sale of investments and non refundable deposit from the Ding deal, among others.

The Australian iron ore explorer posted revenues of AUD 379,972 for the H1 end December 2007 against 2006 AUD 694,398. Corporate and other administration expenses were lower at AUD 454,338 from AUD 707,325.

Ok Tedi strike hits Inmet copper production

Reuters reported that Inmet Mining Corp’s strike over wages at its partly owned Ok Tedi mine in Papua New Guinea would reduce its copper production by 85 tonnes and gold by 330 ounces for each day the strike continues.

The Canadian company Inmet Mining which owns 18% of the mine, said on Wednesday the strike by members of the Ok Tedi Mining and Allied Workers Union was illegal. Work there came to a halt on Tuesday when workers walked off the job. It added that mine workers are striking after they were excluded from a 100% pay increase management awarded to the mine's engineers in a bid to retain them.

Inmet said that the mine's management is taking appropriate steps to address the strike action.

Ok Tedi Mining Ltd, the mine's operator said on Wednesday it hoped the wildcat strike would end by Thursday. They told Reuters that government labor negotiators were on site meeting with the company and workers on Wednesday.

Ok Tedi in 2007 produced 169,184 tonnes of copper in concentrate and 498,790 ounces of gold.

Canadian coking coal exports may rise significantly

The Tex reported that Canadian coking coal exports should rise significantly to take advantage of record prices.

Tex said that Elk Valley Coal Corp is forecasting coking coal sales of 23 million tonnes to 25 million tonnes in 2008 up from 22.6 million tonnes in 2007.

It also said that Western Canadian Coal Corp, Peach River Coal Ltd Partnership and Grande Cache Coal Corp also plan production increases.

ArcelorMittal named Energy Star(R) partner of the year

ArcelorMittal was recently selected as a 2008 ENERGY STAR(R) Partner of the Year for Energy Management by the US Environmental Protection Agency and the US Department of Energy for its outstanding contributions to protecting the environment and reducing greenhouse gas emissions through energy efficiency.

ArcelorMittal is one of three new companies to receive the 2008 Energy Management award and the first steel company ever to achieve the distinction. ArcelorMittal joins a group of distinguished past ENERGY STAR(R) winners including Toyota, PepsiCo, Ford, Merck, JC Penney, McDonald's and Raytheon. ArcelorMittal will be honored at an awards ceremony hosted by the US Environmental Protection Agency on April 1st 2008 in Washington DC.

In late 2005, ArcelorMittal was challenged to reduce energy intensity by 6% over a three year time period using 2005 as the baseline. This equates to a reduction of USD 192 million in energy costs by 2009.

In January 2006, the energy committee launched the ArcelorMittal Energy Reduction Initiative, a three year program that provided an energy plan for the immediate future that would allow ArcelorMittal to decrease its energy and carbon intensity and, at the same time, improve its bottom line. The initiative was designed to attain energy reductions quickly and to build a base for continuous improvement in energy reductions.

Mr Mike Rippey president & CEO of ArcelorMittal USA said that "ArcelorMittal's commitment to energy reduction is viewed as an ongoing process and does not end after year three or when reduction goals are achieved. This initiative is a companywide, continuous commitment to energy reduction and sustainability. This distinction demonstrates ArcelorMittal's commitment to maintaining operational excellence while reducing energy intensity truly exemplifying our company's commitment to transforming tomorrow through Sustainability, Quality and Leadership."

Mr Robert J Meyers principal deputy assistant administrator for EPA's Office of Air & Radiation said that "ArcelorMittal's leadership in managing their energy use is a model for other businesses looking for ways to protect the environment. Because commercial and industrial facilities account for half of all energy consumption in the US and are responsible for nearly half of US greenhouse gas emissions, energy management is a critical element in our efforts on climate change."

The ArcelorMittal Energy Committee was established in late 2005 with representatives from every US facility. At each plant, energy teams made up of the plant manager, plant energy champion, departmental energy leaders, and other key department leaders from accounting, procurement, environmental and human resources were created to engage employees in the energy awareness effort and to identify strategies to improve energy efficiency in their facility. Each facility was responsible for setting energy reduction goals at their respective plants.

Foundation Coal affiliates receive safety award

Foundation Coal Holdings, Inc announced that three of its affiliates received safety awards. The No 1 and No 2 mines of Kingston Mining Inc along with the Camp Creek Mine of Rockspring Development, Inc received the West Virginia Joseph A Holmes award for 2007. The award recognizes the mines for their outstanding safety records.

The mines will receive their award at the 25th Annual Meeting of the West Virginia State Council on May 10th at the Oglebay Resort at Wheeling in West Virginia.

Mr Jim Bryja senior vice president of operations of Foundation Coal said that "The awards are the result of an intense focus on safety at all of our operations. Our employees are committed to doing their jobs safely and efficiently. Awards like the Holmes Safety Award prove it. We congratulate everyone for their safe, hard work and dedication."

AK Steel honored for excellence in manufacturing

AK Steel announced that it has received a MANNY award for excellence in manufacturing from Cincy magazine a leading business publication in Greater Cincinnati. The award recognizes the company for its Breakthrough performance in 2007.

Although faced with historically high raw material and energy costs, AK Steel led all US integrated steelmakers in adjusted operating profitability in 2007. As a result of its cost control efforts, liability reduction initiatives and asset maximization strategy, the company is once again on solid financial footing.

The MANNY awards honor Cincinnati manufacturers across five key areas of success: Job creation, work environment, innovation, breakthroughs and growth. Award recipients were selected by an independent panel assembled by Cincy magazine.

Mr James L Wainscott chairman, president & CEO of AK Steel said that "We are honored to receive a MANNY award from Cincy Magazine. For AK Steel, 2007 was a breakthrough year defined by record performances across all of our key metrics, including safety, quality, productivity and financial results. I congratulate and thank all of our employees for their contributions to AK Steel's success."

MMK offers to acquire stake in Esfahan Steel - Report

Interfax news agency reported that Russian metals giant Magnitogorsk Iron & Steel Works has bid to buy a controlling stake in Iran's Esfahan Steel.

Mr Viktor Rashnikov chairman of MMK said that "We have made an offer to buy Esfahan Steel. We are counting on a controlling stake." He added that the negotiations would be held with Esfahan Steel in April 2008.

He did not reveal the amount of the deals, noting that the Iranian company was still reviewing the offer. The next round of talks on the acquisition is scheduled for April 2008.

Mr Rashnikov also pointed out that MMK is looking into the possibility of purchasing mining assets in Iran as it is quite logical to buy a metallurgical plant with mining assets.

Mr Rashnikov visited several Iranian plants earlier this month, including Esfahan Steel, Mobarakeh Steel, Khuzestan Steel and Gol e Gohar Iron Ore Mining.

Pakistani steel bars price touch PKR 65,000 per tonne

The Dawn reported that price of steel bars in Pakistan has surged to PKR 65,000 per tonne as compared to PKR 53,000 per tonne two months back. Structure steel prices hovered between PKR 65,000 and PKR 67,000 per tonne. According to a steel merchant, per tonne price of steel bars was PKR 48,000 in 2007. However, builders and developers claim that last year steel bar prices ranged between PKR 30,000 and PKR 35,000 per tonne.

Mr Shamoon Baqar Ali president of Karachi Iron & Steel Merchants Association said that the sale of steel bars had been falling after a persistent increase in its prices. The builders and even consumers, who plan to start construction activities, think twice either to buy steel items right now or to wait for a price decline. He added that the builders who have to meet deadlines for project completion are bound to purchase the item at higher prices.

Mr Shamoon said that Pakistan Steel was actually running at 35% capacity and it does not have an ample quantity of the raw material. He added that he had urged the federal board of revenue to cut the raw material prices to 10% from 20% in the budget, besides cutting the sales tax to 15% from 17.5% so that prices of finished products at the domestic level could decline.

Meanwhile, Mr Babar Mirza Chughtai chairman of Association of Builders & Developers said that builders who were already under pressure to provide the completed units at old rates are now facing problems, with the rising prices cement and steel products.

Mr Babar said that the Pakistan Steel, instead of keeping its prices stable and under control, has been frequently increasing rates of raw material and finished products, thus encouraging the vested interest in the market to play havoc with prices. He added that “The relevant government departments are not doing their job to check prices of Pakistan Steel products. The state owned unit should break the monopoly of private sector market players, but it seems that it had joined hands with them in pushing up rates.”

He further added that the construction industry is heading for a serious crisis when builders and consumers will be seen fighting each other on rising prices of their projects. Builders do not have an option of increasing the project cost, like other private sector contractors.

Turkish scrap price reach record high levels

It is reported that Turkey’s scarp price has boosted sharply last week to reach record high USD 500 per tonne.

The price of P&S scrap was at USD 517 per tonne, USD 513 per tonne for shredded scrap and USD 508 per tonne for number 1 and number 2 mixed scrap.

Last week, the A3 scrap contract was to be signed at price of USD 500 per tonne, but it may expect to increase further to USD 510 per tonne this week. Besides, Turkey will sell 35,000 tonnes of bonus scrap to England at USD 550 per tonne for April 2008 delivery.

Many market participants are overwhelmed by this unpredictable raise.

Iran to sign IPI agreement with Pakistan soon – Report

Fars News Agency reported that Iran will soon sign a final agreement to export gas via pipeline to Pakistan. Iran has completed half of the pipeline, which will have a capacity to carry 110 million cubic meters of gas a day to Pakistan.

It may be noted that Pakistani government has asked Iran to close the gas pipeline project, with or without India, by April 2008 to help meet Pakistan's increasing gas requirements.

Pakistani officials said that Iran would hold final talks with India in March 2008 to persuade it to join the IPI gas pipeline project. They added that "If India continued to dither under US pressure, Iran would invite China to join the project. China had promised to line up financial resources for the plan and both countries were in contact on the issue."

A source said that another issue which had delayed the project was shortage of gas in Iran during winter, forcing it to import gas from Turkmenistan. India has the option of using liquefied natural gas but it costs 40% more than the gas to be imported from Iran through the pipeline.

Pakistan had earlier asked Iran to enhance gas volume for Islamabad by 50% under the project in case India stayed away from the deal. The government will soon formally request Iran to allocate an additional 1.05 billion cubic feet per day for Pakistan in case India does not join the project.

Pakistan allows WAPDA to set up power plants

Daily Times reported that federal government of Pakistan has allowed Water & Power Development Authority to set up 600 MW to 1000 MW coal based power plants in Thar to overcome the gap between power demand and supply.

As per report, economic coordination committee of the cabinet headed by Mr Mohammedmian Soomro caretaker Prime Minister of Pakistan has also hinted the approval in this regard after withdrawing the ban on public sector for setting up thermal and coal based power plants. At present, the total power generation of Pakistan stands at around 10,000 MW against the demand of 11,500 MW per day.

Sources said that ECC has approved public private partnership concept under which over 7,927 MW power would be added to the existing power generation of around 10,000 MW power by the year 2009-10. ECC has allowed WAPDA to set up coal based power plants but National Electric Power Regulatory Authority has failed so far to announce the upfront tariff for the investors to set up coal based power plants in Thar.

Pakistan Electric Power Company has been allowed to set up the thermal power generation plants of 2,450 MW by 2010 to overcome the power shortage crisis. 309 MW would enhance the capacity of current existing power generation system during December 2008.

Private sector would set up 15 independent power plants by the year 2009-10 that would generate 2,868 MW of electricity. At present 16 independent power plants are operational in Pakistan that was set up under the power generation policy 1994. Since that time no new investor has made investment to set up independent power plants. Current independent power plants are generating 3,700 MW to 4,500 MW against the generation capacity of over 5,700 MW.

South Korea may cut Libyan oilfield stake in April

Bloomberg reported that South Korea will probably agree to cut a stake in an oilfield in Libya to 4% from 11.67% as Libya wants increased ownership because of rising oil prices.

Mr Jung Seok assistant director of South Korean ministry of knowledge economy's oil division said that “We are still discussing, but it is likely that we will accept Libya’s request in April 2008. Libya asked to renegotiate the production sharing contract late in 2007.”

The field in the Murziq basin in the mid western part of Libya has produced 130,000 barrels a day since 2004. Libya holds 65% stake while Italy’s Eni SpA and ENI Lasmo Plc each have 11.66%. The South Korean group includes Korea National Oil Corporation and SK Energy Company.

Aramco and Total expect to start up Jubail refinery by 2012

Reuters reported that French Total and Saudi Aramco expect a new 400,000 barrels per day refinery in Saudi Arabia to start up in 2012 and a final decision will be made in mid 2008.

As per report, Saudi Arabia is planning 4 new plants as it looks to boost domestic refining capacity by as much as 1.6 million barrels per day from 2.098 million barrels per day. But rising costs for equipment and labor have hit the energy sector worldwide, forcing project cancellations and delays and raising industry concern about the new Saudi plants.

Mr Jean Jacques Mosconi senior VP of Total said that it is confident that the final decision will be made in mid 2008 and operation of the Jubail refinery is expected in 2012. He added that “If we launch the project in 2008, the 2012 start up will be realistic. The final investment decision will be made in summer, in the middle of this year.”

Mr Mosconi said that Jubail refinery would process Arab Heavy and a new grade from the offshore Manifa oilfield in Saudi Arabia, which will start production in 2011. He added that “About 70% to 80% of Manifa will go to Jubail.”

DEWA signs AED 12 billion contracts for mega projects

Emirates Business 24/7 reported that Dubai Electricity & Water Authority has signed 6 contracts for mega projects with a total value of AED 12 billion. The contracts, signed by Mr Mohammad Al Tayer MD & CEO of DEWA and the heads of firms from South Korea, Italy, Dubai, Oman, France and Japan, highlight the expected dates of completion amid tight market conditions.

Mr Al Tayer said that the deadlines for the projects, 3 of which are set to be finished in 2009 and the others by 2010 are reasonable and would be extended in case the time frame is not sufficient. He added that “Most of our contracts are reasonable. Before, we asked for our substations to be finished in 16 months, now we are asking for more than 20 months. For our Jebel Ali power stations, we asked for 22 months, now it is 36 months.”

The first two contracts consist of a combined cycle co generation and power generation and desalination plant with a capacity of 2,000 MW gross power output and 140 million imperial gallons per day distillate water production. The AED 6.2 billion power package was awarded to South Korea’s Doosan Heavy Industries & Construction Company Limited, while the desalination package was awarded to Fisia Italimpianti Spa Italy on a turnkey basis. Both packages are set to be completed in June 2010.

Dubai’s Mammut Group won the contract to build the Mushrif Reservoir phases four through six, which will have capacity of 180 million imperial gallons. The AED 620 million projects are due for completion on April 23rd 2009.

Oman’s Gulf Petrochemical Services & Trading has snatched the AED 155 million contracts to install, test and commission the DFO pipeline from Jebel Ali Free Zone to Aweer power station, which will be due by January 2009.

A consortium of France’s Areva and South Korea’s Hyundai Heavy Industries won the AED 816 million contract to supply, install, test and commission two 400/132 substations. The substations, named Barsha and Horse Race, are due to be finished by the end of December 2009.

Japan’s Mitsubishi Electric Corporation will supply, install, test and commission a 400/132 substation named Technology. The AED 448 million projects will be finished by February 2010.

Oman Cement may rise prices

Emirates Business 24/7 reported that Oman Cement Company is in talks with its government owner about raising prices and otherwise may face a second fall in annual profit.

Mr Jamal al Hooti CEO of Oman Cement said that "If we do not increase cement prices by OMR 1 to OMR 2, profit might come down in 2008. This is due to high clinker prices, which are rising because of high freight costs."

Mr Hooti said that higher freight costs probably mean its cement output in 2008 will hold steady at 1.8 million tonnes as they will discourage the purchase of imported clinker.

Oman Cement sells its output at OMR 26 per tonne. Profit in 2007 fell more than 14% YoY to OMR 17.62 million.

Dana Gas signs USD 110 million offshore gas deal

Khaleej Times reported that UAE based Dana Gas has signed a USD 110 million deal to explore and develop gas offshore of the emirate of Sharjah. The 25 year concession is Dana's first offshore asset.

The concession area is over 1,000 square kilometers and the agreement covers the development of the Zora gas field, discovered in 1979. Dana will continue drilling 2 wells at Zora that its affiliate Crescent Petroleum had started at the field. It will also install offshore platforms to process the gas and a 25km pipeline to bring the gas to shore. It will also explore elsewhere in the concession.

The development at Zora will cost around USD 55 million and exploration a further USD 65 million. The UAE needs more gas to meet rapidly rising domestic demand from industry and power plants.

Dana holds onshore assets in Egypt and is developing gas fields and pipelines in northern Iraq.

Canada keen to increase trade ties with Qatar

The Peninsula reported that Canada is hoping to increase the level of trade with Qatar, which currently stands at USD 200 million.

Mr Denis Thibault Canadian ambassador to Kuwait said that “Both our countries have energy resources but different types of energy. Here it is mostly gas while in Canada, we have heavy crude and a limited amount of gas. We have strong relations in the healthcare and education sectors.”

He added that “We very much value our relationship with Qatar and have seen exchanges between our two countries growing. We will happily enhance the existing relations between the two sides.”

Dolphin Energy gets 'Best Company in Gas Award'

The Peninsula reported that Dolphin Energy Limited has won 'Best Company in Gas Award' at the 7th Annual Middle East Excellence in Energy Awards, organized by Pipeline Magazine, under the patronage of Mr Sheikh Ahmed bin Saeed Al Maktoum President of Dubai’s department of civil aviation and chairman of Emirates Airline and Dubai Supply Authority.

The award recognizes Dolphin Energy’s role in the creation, construction and inauguration of one of the largest international gas development projects ever built.

In 2002 to 2008, Dolphin Energy drilled twenty four 4,000 meter deep gas wells offshore Qatar, fabricated and installed 2 offshore production platforms and designed and built its complex USD 1.6 billion onshore gas processing plant in Qatar. It also completed the longest and largest undersea gas export pipeline in the Middle East, between Qatar and the UAE, as well as the receiving and distribution facilities to serve customers throughout the Emirates and Oman.

Mr Ibrahim Ahmed Al Ansari GM of Dolphin Energy has received the award from Mr Saeed Khoory group CEO of Emirates National Oil Company.

This was the fourth Excellence in Energy Award won by Dolphin since 2004.

Iran, Indonesia and Malaysia sign deal for new oil refinery

Reuters reported that Iran has signed an agreement with Malaysia for setting up 300,000 barrels per day oil refinery in Indonesia.

Iran, which in the face of UN and US sanctions is seeking alternative commercial partners in energy hungry Asia. Iran and Indonesia also reached initial agreement on a planned 360,000 barrels per day plant to refine gas liquids in Iran’s Gulf port of Bandar Abbas and a urea plant with a capacity of 1 million tonnes per year in southern Iran.

Mr Gholam Hossein Nozari oil minister of Iran said that the refinery would be 40% owned by Iran, 40% by Indonesia and 20% by the Malaysian partner. The planned refinery would require an investment of up to USD 6 billion.

Indonesia has 9 oil refineries scattered across the archipelago, with total capacity of around 1 million barrels per day. However, 30% of its oil products consumption is imported.

Jakarta is keen to attract investment, particularly in its energy sector, and would also like to play a bigger role in world diplomacy, particularly involving the Middle East.

The UN Security Council voted last week to introduce a third sanctions resolution against Iran over its refusal to halt nuclear work. Indonesia, a non permanent member of the Security Council, abstained in the vote on the Iran resolution.

Masdar inks JV with Sener to develop CSP plants

Gulf News reported that Abu Dhabi based Masdar and Spain based Sener Groupo De Ingenieria have formed a 40:60 JV company named Torresol Energy to design, build and operate 3 concentrating solar power plants in Spain.

Mr Jorge Sendagorta president & CEO of Sener and Dr Sultan Al Jaber CEO of Masdar announced the launch of Torrresol Energy.

One of Torresol Energy's primary objectives is to widen the adoption of CSP and make it more compatible with grid parity. It will commence work on 3 solar power plants in Spain with an approximate combined value of EUR 800 million.

Independently of Torresol Energy, Masdar is developing concentrating solar power plants in Abu Dhabi and their flagship plant 'Shams 1' is expected to be completed in the fourth quarter of 2010. In every new project Torresol Energy expects to introduce and test new technologies with the long term objectives of making concentrating solar power a very competitive and reliable technology, achieving a leading position in this sector and contributing to the protection of the environment.

SinoSteel makes hostile bid for Midwest

Chinese iron ore trader Sinosteel Corp has made a hostile takeover bid for Australia's Midwest Corp. to secure supply of iron ore. It is the first hostile Chinese takeover play for an Australian company.

SinoSteel said that its offer of AUD 5.6 a share represented a 34.9% premium to yesterday's last traded price of Midwest shares of AUD 4.15. The offer is subject to 50.1% minimum acceptance.

SinoSteel already holds 19.9% of Midwest.

Sinosteel said that it already has Foreign Investment Review Board to acquire Midwest and so needs no further FIRB approval.

JP Morgan is the financial advisor to Sinosteel while EXIM Bank of China has committed to provide funding for the deal.

Mr Tianwen Huang president of SinoSteel said “The offer reinforces Sinosteel's continued commitment to Australia's resources industry and, in particular, the development of the mid west region of Western Australia into a major world class iron ore production province.”

Midwest said its board had informed the market on February 20th 2008 that a proposal from Sinosteel at AUD 5.60 a share would undervalue the company and its prospects. Midwest Corporation has advised shareholders to take no action in response to an AUD 1.2 billion takeover bid from Chinese firm Sinosteel. It said that "The board of Midwest advises its shareholders to take no action and will provide further advice once it has had an opportunity to consider the offer.”

In December 2007, Sinosteel made an incomplete and non binding AUD 1.2 billion bid for Midwest at AUD 5.6 a share. Another Perth based miner, Murchison Metals Ltd, last month scrapped an AUD 900 million takeover offer for Midwest after failing to receive enough acceptances.

Chinese HDG export offer continue to move up

It is reported that HDG coil price keep firm in Chinese domestic market and this is also the case with export quotations, which have been raised again this week.

On Shanghai market, 1.0mm HDG by Anshan Steel is being quoted at CNY 6380 per tonne to CNY 6400 per tonne, 0.5mm by private producers at CNY 6700 per tonne. However, prices in Shandong's Boxing market are quite lower. That for 0.5mm is at CNY 6330 per tonne down from 6480 per tonne to 650 per tonne in last week. 1.0mm HDG is only being quoted at CNY 6050 per tonne.

According to Mysteel Shanghai price for 1.0 HDG by Anshan as benchmark if it could exceed the level of CNY 6400 per tonne, the next target will be CNY 6800 per tonne. Otherwise, there would be downward corrections in the short term. Export offer for 1.0mm HDG is prevailing at USD 960 per tonne FOB up an increase of USD 10 per tonne to USD 20 per tonne from last week.

A Changshu based steel producer tells Mysteel that it is now negotiating with June shipments for HDG exports and there is strong likelihood that there is still room for further increase.

(Sourced from MySteel.net)

China to reduce coal exports quotas for 2008 by 24% YoY

It is reported that China has cut its coal export quotas for the year, beginning this month by 24% YoY to 53 million tonnes as the government seeks to channel production to its own economy.

As per report, "The quotas will be officially handed out next week."

The quotas, usually issued no later than February, were delayed this year, which created uncertainty in the market after the 2007 allotments expired February 29th 2008.

China, the world's largest coal producer and consumer, exported 53.17 million tonnes of coal in 2007 well below the quota and down by 16% YoY.

The cut in the quota would put pressure on international coal prices.

Baosteel's thick walled line pipe fills the domestic blank

It is reported that 1400 tonnes of X52HFW with a diameter of 406.4mm and a wall thickness of 16.66mm produced by Baosteel Steel Tube Plant were delivered to the users recently.

According to the inspection, all the technical performance data has reached the standard requirements. The mass production of this product not only fills the domestic blank, but also symbolizes a big step forward marched by Baosteel's medium diameter straight welded pipes towards the thick walled line pipe.

The successful mass production of thick walled line pipe is a milestone in the development of Baosteel's medium diameter straight welded pipes towards high steel grade and thick wall thickness; moreover it further secures the domestic leadership of Baosteel HFW welded pipes.

China to set up fund for acquiring overseas mines quickly

China Securities News cited Mr Zhou Zhongshu president of China Minmetals Corporation as saying that China plan to set up metals & mining investment fund as soon as possible to push domestic enterprises' participation in global prospecting and mining of mineral resources.

Mr Zhou said the proposed metals & mining investment fund could be initiated by united banks of China investment corporation, large domestic mining enterprises and overseas strategic investors, targeting at the internationally advantageous metals & mining groups for investment, buying shares or making acquisitions directly, with the purpose of building pivot, strategic mineral resources reserves abroad.

He said under such circumstances we need to rely on the nation's foreign exchange reserves set up national metals & mining development fund as a new thought to open up prospecting and mining of mineral resources overseas.

(Sourced from MySteel.net)

Steel price hike not to harm downstream sectors – CISA

According to Mr Zhang Xiaogang of China Iron & Steel Association and GM of Anshan Steel Group the steel price rises are not to do much damage to downstream sectors.

Mr Zhang s in an interview on March 11th 2008 said that the steel prices were pushed up by hiking iron ore and coal prices at the beginning of the year but would not lend much impact on the downstream sectors and based on long and stable partnership, steelmakers and the end users would just consider for each other.

Mr Zhang said that it has been compulsory for China's steel industry to make reshuffle in accordance with the national steel industrial policy. Though the sector's concentration ratio was quite dissatisfactory last year, CISA is confident to realize 50% target by 2010.

(Sourced from MySteel.net)

Shagang to raise steel price

It is reported that China’s major private owned steelmaker, Shagang Group has released the new price list for mid March 2008.

The HRB335 14mm to 25mm rebar has soared to USD 707 per tonne after USD 3 per tonne increase for rebar. Rebar price has also boosted by USD 14 per tonne and Q235 rebar reaches price of USD 725 per tonne.

Above prices is tax included and valid from March 11th to 20th 2008.

(Sourced from MySteel.net)

Xinxing Pipe to enter Europe market

It is reported that the DN 1600mm pipe manufactured by China’s Wuhu XinXing Ductile Iron Pipe Company Limited has passed the test of Bureau Veritas of France.

As per report passing the test means that the large diameter pipe below DN2000mm from Wuhu XinXing Ductile Iron Pipe Company Ltd get permission to export to Europe market.

The test of BV is a professional test for the design, performance, and reliable test data which can meet the global technology standards.

SiMn purchase price up by CNY 500 per tonne in March 2008

It is reported that SiMn price has kept climbing since the second half of last year. Purchase price in March 2008 gains CNY 500 per tonne to CNY 800 per tonne.

In Tangshan and Beijing FeMn65Si17 is mainly priced at CNY 11800 per tonne to CNY 12000 per tonne by large steelmakers and CNY 12400 per tonne to CNY 12500 per tonne by medium and small steelmakers; in Hunan, CNY 11800 per tonne; in Jiangsu and Shandong, CNY 12000 per tonne to CNY 12500 per tonne.

As imported Mn ore price hovers on a high track plus interrupted domestic Mn ore productions, rising costs push up SiMn prices. Besides, some market speculations also work.

(Sourced from MySteel.net)

Inner Mongolia to limit coal output in 2008

It is reported that Inner Mongolia Autonomous Region, a major coal producer in China plans to slow down its coal production and control annual coal output within 420 million tonnes this year.

As per report the move is aimed to upgrade technology and equipment of coalmines and make effective measures to prevent from major accidents in coal production. The region will be built into an important energy industry base of China.

According to the coalmine safety supervision administration department of the region, Inner Mongolia plans to close down 40 small coalmines in 2008, and eliminated outdated production capacity amounting to 6 million tonnes.

By the end of the year 2008, all the coalmines with single well production capacity of more than 1.2 million tonnes are required to achieve full mechanization technology in mining.

CPIC ink cooperation agreement with China Shipping Corp

Interfax China reported that China Power Investment Corp signed a strategic cooperation agreement with China Shipping Company. The report added that the two companies will expand their cooperation and further develop their joint venture, Shanghai Friendship Shipping.

Mr Lu Qizhou GM of CPI said the company plans to build more coal-fired power plants in China's coastal areas, including Shanghai Municipality, Jiangsu Province and Guangdong Province which will receive coal transported by CS.

China Power Investment Corp is one of the major state owned power companies in China. The China Shipping Company is a state owned enterprise with shipping as its major business.

Yuxi Steel produced 1 million tonnes of steel in 2007

It is reported that Yuxi Xinxing Iron & Steel Co produced over 1 million tonnes of steel after fulfilling capacity the previous year.

As per report in the 11th five year plan period, Yuxi Xinxing Iron & Steel Company plans to invest CNY 1.4 billion to build a new store yard add sintering machine, blast furnace and converter as well as supported facilities, while install equipments to save emissions or waste water for environment protection.

Yuxi Xinxing Iron & Steel Co aims to produce 2 million tonnes steel by 2010 with annual sales income of CNY 6.4 billion profit of CNY 250 million and taxation of CNY 300 million.

Yuxi Xinxing Iron & Steel is funded by Kunming Steel Group, costing CNY 2.5 billion with the purpose of doubling its capacity in future.

(Sourced from MySteel.net)

Six dead in coal mine blast in South West China

Xinhua reported that six miners died in a coal mine blast on Wednesday in southwestern Chongqing Municipality.

According to the information office of Wuxi County the gas explosion occurred at 11:30AM on Wednesday as eight miners were working underground in Dayang Coal Mine in Zhonggang Town of Wuxi County. Two of them escaped while the other six were killed. It said the bodies of the six had been found by 5:00 AM on Thursday.

The information office said the mine owner continued to organize illegal digging regardless of the local government's order on Tuesday to shut it down to clear safety problems.

Police were searching for the owner and investigating the cause of the accident.

Major bottleneck of Yangtze transport cleared in Central China

Xinhua reported that 10,000 tonnes cargo ship fleet passed through the formerly shallow Luohuzhou section of the Yangtze River marking the completion of a two year clearance project to break the bottleneck.

The six vessel fleet laden with iron ore took 1.5 hours to pass through the 12 kilometer section which had infrequently in the past stranded heavyweight fleets going to Wuhan, the largest city in central China.

Mr Peng Songbai a Wuhan based Yangtze River Waterway Bureau official said the central government's budget of CNY 133 million resulted in a comprehensive clearance of the section over the last two year. He said the channel depth was now more than 4.5 meters, which allowed a 10,000 tonne grade fleet to pass.

There are more than 40 major shallow water areas or rocks hindering transport on the Yangtze, the world's busiest waterway. More than 20 are in the middle reaches.

China invested CNY 1.7 billion last year to clear eight shallow sections in the middle and lower reaches of Yangtze. It planned to remove others by 2010.

MMK raises stake in Belon Coal

Magnitogorsk Iron and Steel Company have announced creation of a strategic alliance with the Belon OJSC. Creation of the alliance is the result of MMK acquiring 50% stake in company Onarbay Enterprises Ltd owning 82.6% of the Russian coal producing company Belon.

Key highlights of the transaction include the following:

1. Indirect ownership of MMK in a large Russian producer of coal and coal concentrates “Belon” increased to 41.3% for a consideration of USD 230.4 million.

2. Strategic investment advances MMK’s long term raw materials security for its steel production

3. The move secures supplies of coal concentrates to MMK

4. The planned investment will result in Belon’s coal production capacity increasing almost three fold to 14.4 million tonnes per annum by 2012

5. The transaction will secure 55% of MMK’s requirement of coking coal, and 60% of steam coal by 2012

Mr Victor Rashnikov chairman of the MMK said that “This transaction represents a major strategic step for MMK towards our declared goal of securing supplies of essential raw materials. This acquisition gives MMK an opportunity to share in Belon’s profitability and the development of its coal interests, which will meet a sizeable part of our raw material requirement. Strengthening our strategic partnership with Belon will provide us with additional advantages in terms of our competitive ability.”

Severstal subsidiary wins auction for 2 gold fields in Chitinskaya

Severstal announced that its subsidiary OOO Severnaya Zolotorudnaya Kompaniya (Northern Gold Mining Company) has won an auction for the geological exploration and gold extraction rights at the Nerchenskaya and Kunikan fields in the Chitinskaya oblast.

The auction was held by the Subsurface Management Department of the Chitinskaya oblast on March 13th 2008 in Chita.

Severnaya Zolotorudnaya Kompaniya’s winning bid for Kunikan fields was RUB 39 million from a starting price of RUB 15 million. According to Severstal Resurs estimates, the resources in this field are predicted to be 15 tonnes of gold.

Severnaya Zolotorudnaya Kompaniya’s winning bid was RUB 16.5 million from a starting price of RUB 15 million. According to Severstal Resurs estimates, the resources in this field are predicted to be 20 tonnes of gold.

Evraz set to purchase US Ipsco

FIS reported that Evraz Group is willing to purchase the US producer of steel pipes Ipsco Inc.

Evraz already made an attempt to purchase Ipsco in 2007 but got out from the competition because of high price. Ipsco was purchased by Sweden's SSAB for USD7.7 billion.

Currently SSAB is considering the opportunity of selling the plant and has finished the acceptance of proposals from potential buyers.

However the principal competitors are ready to pay from USD 3.6 billion to USD 5 billion so SSAB and its consultant on the deal Deutsche Bank suggested that potential buyers review their offers and submit new offers within a few weeks.

Australian regulator clears MMK stake in Fortescue

Interfax reported that Magnitogorsk Iron & Steel Works has obtained clearance from the Australian regulatory authorities to increase its stake in Fortescue Minerals.

Mr Viktor Rashnikov the Russian steel major's main beneficiary and board chairman said "We'd been waiting for this for a long time and eventually got it. He said MMK bought 5.37% of Fortescue in 2007. This was a very good investment. We bought the 5% but needed approvals to buy more. Their share price has skyrocketed while we've been waiting."

Mr Rashnikov said "We would like to buy 20%. We had a deal with shareholders for now. We spent USD 170 million putting our share package together, but this is worth USD 1.15 billion. There is no particular reason for MMK to increase its stake in Fortescue right now, but, depending on market trends, MMK is not ruling this out in the future.”

He said "We have looked at the company very closely and have visited all its fields. We have not forgotten about our shareholding, we might buy more."

Gazprom and Ukraine reach gas supply agreement

Russia's Gazprom will supply upwards of 7.5 billion cubic meters of gas to Ukraine per year giving it 10% of the Ukrainian gas market.

Gazprom said in a statement that its chief executive, Mr Alexei Miller and Mr Oleh Dubyna the CEO of Ukraine's Naftogaz signed the agreement which states that Ukraine will receive at least 49.8 billion cubic meter of gas originating in Central Asia at USD 179.5 per thousand cubic meters between March and December 2008. Naftogaz will buy this gas at the Ukrainian border.

It said that the 5.2 billion cubic meter of Central Asian gas supplied in January to February 2008 will be signed for and paid for in full under contracts between RosUkrEnergo and UkrGazEnergo.

In addition to the Central Asian gas, Naftogaz will sign a contract with RosUkrEnergo on the purchase sale of Russian gas supplied in January to February 2008 at a basic price of USD 315 per thousand cubic meters, with payment by returning the corresponding volumes of gas possible.

Effective from April 1st 2008, a subsidiary or affiliate of Gazprom will deliver at least 7.5 billion cubic meter of gas per year directly to Ukrainian industrial consumers. This represents around 10% of the Ukrainian gas market.

Gazprom added that negotiations on gas supplies to Ukraine in 2009 and in the years that follow will continue, with account taken of emerging tendencies in procurement prices for Central Asian gas.

Ukraine in race for Voestalpine steel plant

It is reported that Ukraine is in race for Austrian steel major Voestalpine’s proposed 5 million tonne Greenfield plant in Black Sea region. If Ukraine is selected over other countries it would represent a large Greenfield investment in steel sector after a long time.

Mr Claus Geiger a spokesperson at Voestalpine’s headquarters in Austria said his company would spend much of this year deciding whether to build the plant at 10 possible sites in Ukraine, Romania, Bulgaria or Turkey.

He said “No decisions whatsoever have been made. We want to gain a complete view, particularly on the investment costs and profitability of such a project. A final choice could be made late this year.”

The new plant’s capacity will mirror that of Azovstal and Illich Metallurgical Plant, both of which trail ArcelorMittal Kryviy Rih, Ukraine’s leading steel producer and it will bring a big competition on the domestic market largely controlled by domestic and Russian business groups once it is completed.

Ukraine iron ore exports in 2 months up by 16.5% YoY

Interfax reported that Ukraine raised iron ore exports tentatively 16.5% YoY in January to February to 3.611 million tonnes. Iron ore concentrate exports nearly doubled to 929,900 tonnes, pellet exports down by 4.2% to 1.419 million tonnes, and sinter ore exports rose, by 9.9% to 1.262 million tonnes.

February iron ore exports came to 1.788 million tonnes overall, including 490,700 tonnes of concentrate, 643,100 tonnes of sinter and 654,400 tonnes of pellets.

Ukrainian steelmakers increased iron ore imports 58.2% YoY in January to February to 790,200 tonnes including 421,000 tonnes in February. Concentrate imports rose 13.7% to 348,600 tonnes, sinter 43.9% to 218,000 tonnes and pellets 440% to 223,700 tonnes in the two months including 180,300 tonnes, 125,300 tonnes and 115,500 tonnes in February.

Ukrainian scrap metal exports grew 1.6% YoY in the two months to 80,900 tonnes. Scrap yards collected 1.017 million tonnes of scrap in the two months including 573,300 tonnes in February. Ukrainian steel mills received 936,200 tonnes of scrap in January to February. Scrap metal exports fell 7.8% in 2007 to 688,300 tonnes.

MMK reports 2007 results under RAS

RBC News reported that Magnitogorsk Iron and Steel Works revenue under RAS grew by 17.87% YoY to RUB 190.287 billion (USD 7.91 billion) in 2007.

MMK's gross profit increased by 4.42% YoY to RUB 61.282 billion (USD 2.55 billion), while sales profit rose by 2.67% YoY to RUB 51.447 billion (USD 2.14 billion).

As reported earlier, MMK's net profit grew by 39.36%YoY to RUB 51.723 billion (USD 2.15 billion) in 2007 compared to the previous year.

MMK is scheduled to release its US GAAP full year figures on March 17th 2008

Severstal upgrades pickling line No1 at Cherepovets

FIS reported that capital overhaul of the continuous pickling line No 1 in the unit of pickling of cold rolled sheet production was completed at Cherepovets Metal Integrated Works.

Investments into the overhaul amounted to RUB 52 million.

New pickling tubs manufactured by SSM-Tyazhmash by modern technology will have an extended service life and exclude the discharge of vapors to the air of the line's working zone.

TMK to ship 100,000 tonnes of pipes per year to Turkmenistan

Interfax reported that TMK plans to sell up to 100,000 tonnes of pipes per year to Turkmenistan's oil and gas industry.

Mr Dmitry Pumpyansky board chairman of TMK met with Mr Gurbanguly Berdimuhammedow president of Turkmen to discuss the outlook for cooperation in Turkmenistan's oil and gas sector and TMK's plans to expand its presence in the Central Asian market.

The report added that "The sides expressed their mutual interest in increasing shipments of pipe to Turkmen companies in the fuel and energy sector, specifically Turkmenneft, Turkmengaz, Turkmengazstroi and Turkmengeologiya."

They discussed the outlook for delivering large-diameter pipe for participating in major pipeline projects in the republic, and for construction of the Caspian gas pipeline and the Malai-Bagdiyarlyk pipeline.

TMK has already delivered 10,000 tonnes of large diameter pipe to Turkmenneft through its trade representation in Turkmenistan. The company has also won a number of tenders to deliver oil and gas pipe and general-purpose pipe.

Belon still planning SPO

Interfax cited Mr Andrei Dobrov president of coking and steam coal producer Belon as saying that Belon is still planning a secondary listing on Russian and foreign stock exchanges.

Mr Dobrov said the Belon could list 15% to 20% of its shares in 2009 or 2010, depending on market conditions. He said 'We are planning to list on one of the exchanges in 2009. It could happen at the beginning of 2010.”

He did not specify the international exchange on which Belon might list.

MMK announced that it raised its stake in Belon to 41.3% by acquiring half of Onarbay Enterprises Ltd from Sapwood Investments for USD 230.4 million.

Belon produced 2 million tonnes of coking coal and 2.7 million tonnes of steam coal in 2007. At present, 17.5% of the company's shares trade on Moscow's RTS and MICEX exchanges.

Belorus starts import of Russian electric power

FIS reported that on March 10th 2008 Belorus started imports of Russian electric power.

The report added that the contract with Russia's Inter RAO UES provides for the supply of 2 billion kWh in 2008.

The Byelorussian party hopes to increase supplies to 5 billion kWh.

UGMK to build electric power station in Sverdlovsk region

FIS reported that Ural Mining and Metallurgical Company selected a site for the construction of a coal fueled electric power station of the capacity of 1000 MW.

The station will be built near the Chusovaya River in the settlement of Staroutkinsk. In accordance with an agreement between the regional government and RAO UES, electric power stations of the total capacity of 5000 MW will be constructed in the Middle Ural.

The regional authorities undertook to put into operation 1000 MW of generating capacities. UGMK acted as the customer and major investor of the project costing RUB 42 billion.