December, 30 2005
Jharkhand government to challenge order for Chiria mines to IISCO
Jharkhand government has decided to challenge the mining tribunal order renewing mining lease to Indian Iron and Steel Company IISCO in the High Court. The states mines and geology minister Mr Madhu Koda said that is government will fight nail and tooth for the return of Chiria mines.
The mining tribunal order will soon be challenged in the High Court. In any case there is no dearth of iron ore reserves in the state. We are ready to give other virgin mines to Mittal Steel and other industrial houses, who have signed MoUs during the recent past, he added.
The minister said his government was ready to give the Mittal Steel virgin iron ore reserves for captive mining in Ursian, Budhaburu, Chutiburu or any other suitable place. The quality of iron ore available in these places is very much comparable to the ones found in Chiria mines. It is a separate thing that the Mittal Steel representatives have not spoken to us on the issue, but we are ready to extend them all possible help, he added.
The mining tribunal recently ordered renewal of mining lease granted to IISCO. This company has been carrying out its operations at the Chiria mines for the last several decades. But, during the last six months or so the Jharkhand government refused to renew their mining leases at three places and asked them to stop carrying out their mining operations. Consequently, IISCO approached the Jharkhand High Court for justice. The High Court stayed the Jharkhand government order and transferred the case to mining tribunal which decided in favor of IISCO
Sources said before signing MoU for setting up a 12 million tonne steel plant in Jharkhand, Mittal Steel had secured a word from chief minister Mr Arjun Munda that he will be given Chiria mines for captive mining. TATA Steel and other industrial giants who have agreed to set up new steel plants have been eyeing the Chiria mines.
The Chiria mines are the countrys biggest iron ore mines, with 2.5 billion tonne reserves.
West Bengal sponge iron units threatens closure
It is reported that a total of 41 sponge iron units in the West Bengal are going to shut down from January 5 owing to the hike in the price of iron ore. The West Bengal government is apathetic towards our condition and if we shut down our units, the government will be losing about 800 crore annually in terms of excise and sales duty taxes. aid Mr Shubhendu Bhattacharjee secretary of West Bengal Sponge Iron Manufacturing Association.
It is reported that the West Bengal sponge iron industry is getting support from the sponge iron industries of Chhatisgarh, Orissa and Jharkhand. The total number of units in eastern region along with Orissa and Jharkhand is reported to be around 253.
The price of sponge iron is around Rs 8,200 per metric tonne, but on the other hand the cost of iron ore and coal, have increased at an alarming rate, which is giving a tough time to the sponge iron manufacturers, said Mr Bhattacharjee.
Presently, iron-ore producers are selling ores at the cost of Rs 2,400 per metric tonnes, earning a profit of around 600 per cent. Mr Bhattacharjee said. He also said that iron ore prices had gone up by almost 400% in last three years from Rs 500 per ton in 2002 to Rs 2,400 per ton in 2005.
The association has demanded from the Central Government and the State Government to set up a regulatory committee for reducing the coal and iron -ore prices.
Indian steel minister hints at banning export of high quality iron ore
Indian Union Minister Mr Ram Vilas Paswan said that his ministry is against the export of high quality iron ore when the domestic industry needs such raw materials for cost effective production. Mr Paswan said that his ministry is finalizing a new steel policy by April next year that would focus on expansion of domestic production of steel at an estimated investment of Rs 175,000 crore over the next 15 years while banning iron ore, mainly of high grade, whose reserves are depleting.
He said that India has a reserve of high grade ore of 936 million tonnes which would last only 18 years to feed our domestic steel making industry.
Govt likely to put emergency coal production plan in action
It is reported that Indian government is planning to put an emergency coal production plan to increase the capacity of existing coal mines and also planning to give away coal blocks originally earmarked for CIL to other consumers such as power, steel and cement industries to augment coal production as CIL is already operating at optimal capacity.
In effect, this would bring in larger number of players in the coal mining sector. The move comes even as power plants which complained of critical stocks of coal all through the year
The emergency plan was drawn up in response to the power sectors warning that the 2011-12 coal production target of 525 million tonnes would fall short of the requirement by 70 million tonnes.
Fire in MCL coal mines
All mining operations in mine number three of the Orient area in Brajarajnagar under Mahanadi Coal Field Limited MCL were suspended today following detection of fire.
Police said there was huge amount of carbon monoxide inside the mines as a result of the fire forcing the MCL authority to close down the mines.
MCL sources said the automatic fire fighting system detected the fire and the authorities promptly prevented it from spreading to other areas. No casualty was reported.
Investigations are being conducted to ascertain the exact cause of the fire
TATA Metaliks gets Usha Ispat's Redi assets
TATA Metaliks has won the bid to acquire the immovable and movable assets of Usha Ispat located at Redi, Maharashtra. Stressed Assets Stabilization Fund had invited the bids, which were finalized today, and the company has been declared as the highest bidder.
"The physical possession will be transferred and the necessary definitive documentation will be executed as per the procedure set out by SASF," the release added.
Villagers disrupt construction work at Bhushan Steels Orissa
It is reported that villagers of Sarappa and Raghunathpur led by the Hindol MLA Ms Anjali Behera have stopped construction works of Bhushan Steels and Strips Ltd. near Banarpal here demanding fulfillment of their basic demands.
They were led by the Hindol MLA, Ms Anjali Behera.
The agitating villagers alleged that the company authorities were oppressing them by denying due compensation to them for their land and employment.
They waged a peaceful stir at the construction site since 16 December but disregarding their demand the company authorities tried to do some excavation works from yesterday attracting all-out protests.
Arcelor to buy stake in Erdemir from OYAK
Arcelor is reported to have agreed to buy a holding in Eregli Demir & Celik Fabrikalari TAS from OYAK, three months after 49% stake in Erdemir auctioned to Ordu Yardimlasma Kurumu OYAK, the Turkish military's pension fund for $2.77 billion
Turkish government's asset sale agency said this in a statement today, without giving a value for the transaction. Arcelor spokesman Mr Luc Scheer wasn't immediately able to comment on the statement from the Turkish government.
A stake in Erdemir gives Arcelor access to an expanding domestic market and an export hub that straddles Europe and the Middle East.
Arcelor engages into strategic partnership for Erdemir
Arcelor and the Turkish armed forces pension fund Ordu Yardimlasma Kurumu OYAK have agreed on December 23, 2005 that Arcelor will acquire, subject to certain conditions, 41% of Ataer Holding, a wholly owned OYAK subsidiary that has been founded to acquire a 49.29% equity stake of Eregli Demir ve lik Fabrikalari AS Erdemir
This move will allow Arcelor to develop its position in the growing Turkish and regional steel markets, leveraging the performance of the high quality assets of Erdemir. The Turkish steelmaker will benefit from the technology and innovation leadership, powerful sourcing and extensive global commercial network of Arcelor to further boost its operational excellence.
The price offered by Oyak for Erdemir shares in a public auction organized by the Turkish Privatization Administration on October 4 2005 $2.77 billion for a 46.12% stake will be the reference for the acquisition by Arcelor of the stake in Ataer.
The transaction is subject to various regulatory approvals, including the Turkish Competition Authority. Further details will be disclosed upon the closing of the transaction between Arcelor and Oyak.
In the context of the privatization process, Oyak additionally obtained the right to acquire 3.17% in Erdemir from the Development Bank of Turkey TSK, allowing it to acquire a total equity stake of 49.29% in Erdemir.
Separately, Arcelor holds approximately 5% of the capital of Erdemir.
Chinas steel & coke capacities to cast a global doom
China has issued new official estimates of enormous overcapacity in
Steel making, supporting earlier forecasts of glut in 2006 by a think-tank attached to the cabinet "It's pretty likely we'll see more Chinese steel in the US market," says Mr Michelle Applebaum, an independent steel industry analyst in Chicago. "China is so big and is trying to match production growth with consumption", which the world now knows isn't happening.
China's annual steel capacity would hit approximately 470 million tons by the end of 2005 up by 10.6% from 2004, according to Ms Ma Kai, head of the National Development and Reform Commission NDRC Chinas top economic planner. Earlier NDRC put 2006 surplus production in excess of 116.5 million tons and than China's Steel Industry Association CISA had dismissed that earlier forecast as "rubbish," saying 2006 output of 380 million tons would be balanced by demand.
But then Ms Ma tells a national economic conference in December that steel production capacity would reach 600 million tons if all the plants under construction or planned were included and, since his demand estimate for 2006 is 380 million tons, his projected surplus remains at 120 million metric tons. That's why the government has imposed a temporary ban on steel plant construction Ms Ma says.
The official adds that updated macroeconomic planning shows the country has too many plants making steel and coke. China's annual coke output capacity of 300 million metric tons had already exceeded demand by 100 million tons says Ms Ma but the industry is building an additional 30 million tons and planning yet another 30 million tons.
Evraz shareholders elect new CEO and Chairman
Shareholders of Evraz Group S.A., Russia's biggest steel producer, appointed Mr Valery Khoroshkovsky, who is currently Evraz MD Operations, as the new CEO with effect from January 1, 2006 at an extraordinary shareholders' meeting in Luxembourg on December 29.
The Evraz board also appointed Mr Alexander Frolov, Evraz's Managing Director Corporate, as its chairman with effect from May 1, 2006,
Mr Alexander Abramov the present CEO and Chairman would step down on January 1 and would remain as a non executive Evraz director
Laiwu Steel commissions SMS Meers beam and section mill
Laiwu Steel International China has successfully commissioned the heavy beam and section mill supplied by SMS Meer. The mill with designed capacity of one million tonnes will produce beams with a maximum web height of 900 mm and maximum flange width of 400 mm from three types of continuous cast beam blanks for the whole product size range.
The SMS Meer scope of supply included a heavy two high stand, a compact reversing stand group each consisting of a universal roughing and finishing stand and a shift able horizontal edging stand of CCS design (Compact Cartridge Stand).
In addition, SMS Meer supplied a roller straightener, hot and cold saw installations and the engineering for finishing and loading facilities. The roller straightener supplied by SMS Meer is the worlds largest roller straightener of CRS design (Compact Roller Straightener). It is characterized by straightener shafts mounted in bearings on both sides, hydraulic adjustment of the straightening rollers and fully automatic straightening roller changing using a manipulator crane.
SMS Meer GmbH forms part of the Tube, Long Product and Forging Technology Business Area of the SMS group. SMS GmbH is the holding for a group of companies internationally active in plant construction and mechanical engineering relating to the processing of steel, non-ferrous metals and plastics. The group is divided into the Business Areas of Metallurgical Plant and Rolling Mill Technology, Tube, Long Product and Forging Technology and Plastics Technology.
Acindar tubes division sale to Siat approved
An Argentine court has cleared long steelmaker Acindar to sell its tubes division, the company told the Buenos Aires stock exchange. The deal was already approved by the antitrust regulator.
Under the deal, signed in May 2005 for $83.2 millions, Siat would pick up Acindar's steel tube plant in Villa Constituci. Siderar would secure tube and cold-formed product plants in Rosario and San Luis that together produce 140,000 tonnes per year.
Siat is a unit of steel pipe manufacturer Tenaris and Siderar is part of the Latin American steelmaking giant Ternium. Both Ternium and Tenaris are related to the Techint group.
Acindar is Argentina's largest producer of long steel, and is controlled by Brazilian steelmaker Belgo-Mineira. The company exports 25% of its production, primarily to Bolivia, Brazil, Chile, Peru and the US.
Coal mine flooding kills 2 in Shanxi province
Two people were confirmed dead and 15 others trapped underground in a coal mine flooding accident that occurred on Wednesday morning in Zuoyun County of north China's Shanxi Province, the provincial colliery work safety supervision bureau said
The accident took place at around 8:00 on Wednesday morning when 22 miners were working at Fanjiasi Coal Mine in Dianwan Town of Zuoyun County. Only five people escaped, with the remaining 17 trapped.
Rescue work is in progress and the cause of the accident is being investigated.
Russian rail tariffs to ports to increase 12.8% from January 1
Rail freight tariffs to Russian ports are to increase 12.8% from January 1, according to a Federal Tariffs Service FTS decision from December 2005. FTS decided to introduce a differentiated indexation of tariffs. In total tariffs are indexed 7.5% but the tariff to border crossings will remain unchanged, and on domestic routes to Russian ports it will increase 12.8%.
In addition, from January 1 a number of exclusive rail tariffs come into effect. In particular, there is a reduction factor of 0.831 for oil freight to China over 8.8 million tonnes. The factor comes into effect for the first tonne over this amount.
Exclusive tariffs will be in place in 2006 for coal and fuel oil freight to the Far East and Arkhangelsk region.
At the same time, from January 1 the discount will end on rail transportation of iron ore commodities from Ukraine, in place in Russia since May 2005. The tariff for rail exports of iron and steel through Far East ports will remain unchanged in 2006.
The Federal Tariffs Service plans to even out tariffs by 2009. In 2007 tariffs for freight transport to ports will be indexed by about 10.4%, and in 2008 - by 8.8%.
Inner Mongolia Baotou Steel Union starts production of rails
The Inner Mongolia Baotou Steel Union Co Ltd has successfully rolled out a rail on the newly erected mill in Baotou. The order for 900,000 tonnes rail and section mill was placed on SMS Meer in December 2003 and production has started within 24 months
The Inner Mongolia Baotou Steel Union plans to focus its production in future on the manufacture of high-speed rails for the expansion of the railway network in China.
The SMS Meer scope of supplies and services included the planning of the whole rolling line, supervision of the manufacturing in China for selected mill components as well as the production and supply of the reversing tandem stand group as the key component of the plant.
SMS Meer has also supplied and commissioned the automation system for the mill. This included essentially the control engineering, mill operating system with host system and the hydraulic roll adjustment system.
SMS Meer SpA forms part of the Tube, Long Product and Forging Technology Business Area of the SMS group. SMS GmbH is the holding for a group of companies internationally active in plant construction and mechanical engineering relating to the processing of steel, non-ferrous metals and plastics. The group is divided into the Business Areas of Metallurgical Plant and Rolling Mill Technology, Tube, Long Product and Forging Technology and Plastics Technology
Baotou Steel shares up on report of Mittal Steel interest
Share prices for Baotou Iron & Steel (Group) Co jumped yesterday following reports that Mittal Steel is considering an investment in the company. Inner Mongolia Baotou Steel Union Co's shares also surged by 3.7% considering that a deal was likely with its state owned parent company.
Baotou Iron & Steel, founded in 1954 in north China's Inner Mongolia, is a medium size steelmaker and also is China's biggest producer of rare earth products.
Mittal Steel is reported to be in talks with Kunming Iron & Steel Co, the biggest steelmaker in the southwestern province of Yunnan, also about a possible JV.
Although foreign investment in China's steel industry is restricted "in principle" due to its strategic importance, the government is encouraging foreign involvement to help local steelmakers acquire advanced technology and improve their management, the state-owned newspaper China Securities Journal said in a report yesterday.
Wugang steel production crosses 10 million tonnes mark
Wuhan based Wuhan Iron and Steel (Group) Corporation (Wugang), one of China's major iron and steel groups, had produced 10 million tons of steel by December 18 and 10.01 million tons of iron and 9 million tons of rolled steel by December 25.
It represents a landmark for the iron and steel giant to have both iron and steel output surpassing 10 million tons.
Bekaert to build tire cord plant in Shenyang China
Belgium based Bekaert a steel cord major has planned to inject $30 million in building high quality wire products in Shenyang of Liaoning Province for producing fine wire and special type of steel cord products. Construction of the project will officially start in February 2006.
In March 1998, Bekaert invested $11.5 million in setting up a joint venture, Bekaert Shenyang Steel Cord, which is engaged in turning out steel wire and cord for world's two famous auto tire producers Michelin and Bridgestone.
Brazil Bank BNDES to finance foreign acquisitions
Brazil's biggest lender state development bank BNDES, plans to step up financing of corporate acquisitions outside the South American country to help companies expand. BNDES has set up an unlimited credit line to make loans or investments in companies for foreign acquisitions, transactions that will make them less vulnerable to takeover themselves, said Mr Guido Mantega, the bank's president.
If these companies don't grow they will be absorbed by competitors,'' Mr Mantega said. We will support these companies, including their international actions.''
The first such investment was $80 million of financing for Brazilian meatpacker Friboi Ltda's September acquisition of Swift Armour SA, Argentina's largest meat exporter, he said.
Two coalminers rescued in Kemerovo mine in Russia
Two coal workers who were rescued from a mine in Kiselyovsk in Kemerovo Region Russia after a cave in on Thursday are in satisfactory condition, the deputy chief of the regional technical supervision watchdog Mr Viktor Khramov has told
The incident occurred at about 08:00 Moscow time. The miners remained trapped underground for six hours but no one was hurt.
Allegheny Energy in coal mining deal with Alliance Resources
Allegheny Energy Inc said that it has signed a deal with an affiliate of Alliance Resource Partners LP to mine an Allegheny coal reserve in Pennsylvania. The reserve is estimated to hold more than 50 million recoverable tons of coal. Alliance is expected to apply for the needed permits in 2007, with mine opening targeted for 2009 or 2010. Alliance estimated it would cost $165 million over five years to develop the property.
Allegheny said it would buy up to 2 million tons a year of output from the mine in addition to royalty payments of $5 million to $10 million per year
SMS Meer bags order for a bar mill for Al Tuwairqis Thamesteel
Al Tuwairqi Trading & Contracting Est Dammam Saudi Arabia has awarded an order to SMS Meer Italy for the supply of a bar mill plant for their UK based Thamesteel Ltd. The mill will be designed for an annual capacity of 500,000 to 600,000 tonnes per year. The product mix would includes plain of 16 to 63 mm diameter, rebars with diameters from 12 to 50 mm, flats 40x5 mm to 160x6 to 25 mm and equal angles 40x4 mm to 60x8 mm. The mill will supply the stock for the existing finishing block and wire rod line. The bar mill is scheduled to go into full production in the second quarter of 2006.
The SMS Meer scope of supply includes a high-pressure descaler, 18 housingless mill stands, quenching and self-tempering facilities, lifting roller conveyor and a 102 m long rake-type cooling bed, stacking device, bundling, weighing and transfer units and all auxiliary facilities.
SMS Meer will also be responsible for the electrical equipment and automation system as well as for the software of the rolling mill and finishing line. Supervision of erection and commissioning and training are also included in the scope of supplies and services.
SMS Meer SpA forms part of the Tube, Long Product and Forging Technology Business Area of the SMS group. SMS GmbH is the holding for a group of companies internationally active in plant construction and mechanical engineering relating to the processing of steel, non-ferrous metals and plastics. The group is divided into the Business Areas of Metallurgical Plant and Rolling Mill Technology, Tube, Long Product and Forging Technology and Plastics Technology
Mittal Steel US formally announces Weirton layoffs
Mittal Steel officially notified the Independent Steelworkers Union on Thursday that it would lay off about 800 workers at the company's West Virginia mill, union President Mr Mark Glyptis said. Mittal Steel announced a month ago that it was eliminating the jobs as part of a plan to permanently shut down the facility in Weirton. "It is certainly not welcome news today but not unexpected," Mr Glyptis said in a statement.
Mittal Steel informed the union of the layoffs through a letter, a requirement designed to give employees advance notice of plant closings or mass layoffs.
Approximately 350 union employees took voluntarily layoffs. The other 450 layoffs are expected to begin by early March, ISU spokesman David Gossett said.
"Layoffs are always painful for all of us. But the number of potential layoffs the Ohio Valley is now facing is devastating," Mr Glyptis said. "So we are committed to fighting to save our jobs and our mill."
At one time, the mill employed some 13,000 people. It now has just 1,300 union workers.
Harsco acquires Northern Hemisphere operations from Brambles
Harsco Corporation announced that it has completed the acquisition of the Northern Hemisphere steel mill services operations of Brambles Industrial Services BIS a unit of Australia based Brambles Industries Limited. The Company paid approximately $229 million plus a working capital adjustment for the business, and is proceeding with the appropriate regulatory filings. The acquisition, made on cash free & debt free basis, is expected to be accretive to Harsco's 2006 earnings.
Operating under long term contracts at some 19 locations in the UK, France, Holland and the US, the operations add to the global breadth and scope of Harsco's Mill Services segment, expanding its provision of on site, outsourced mill services to the steel and metals industries to approximately 180 sites in 32 countries. The operations provide a complementary range of mill services that includes metal recovery, slag processing, and material handling, and specialty operations that include the briquetting of waste materials for recycling into the steelmaking process.
Announcing the acquisition, Harsco Chairman, President and CEO Mr Derek C. Hathaway said, "The addition of these high-quality operations represents an excellent strategic fit which further strengthens our partnerships with the leading producers in the global steel industry and increases our opportunities for long-term service growth.Coupled with our Hunnebeck Group acquisition last month, expanding our Access Services segment, we continue to execute on our strategic objectives for strengthening Harsco's global industrial services base and providing increasing value for our stockholders."
Harsco's Mill Services segment provides the world's leading steelmakers with a comprehensive range of services that support the entire steelmaking process, including integrated materials handling, semi-finished and finished product management, and metal recovery and byproduct recycling. Similar services are provided to the makers of aluminum, copper and other metals.
Coal mine fatalities down in US mining industry in 2005
Coal mining fatalities were down nationwide in 2005, according to federal regulators. Barring more accidents before year's end, 2005 could go down as perhaps the safest coal-mining year in the country's history.
The federal numbers come from the federal Mine Safety and Health Administration, which compiles nationwide fatality statistics for all U.S. mining operations. The previous national record was 27 in 2002. As of now, only 21 deaths related to coal mining had been recorded by federal regulators. Seven occurred in Kentucky, and just three died in West Virginia
"As far as I know, it's a record," said Mr Bill Raney, president of the West Virginia Mining and Reclamation Association. "We're awfully proud of it, but you also get awfully pensive this close to the end of the year."
A 1988 MSHA policy says that if a person is killed on mine property, the death is counted as a mining-related fatality, even if the victim is not a mine employee.
Brazilian coalminer CRMs production up by 30%
Rio Grande do Sul-based Brazilian mining company CRM is on track to produce 2.2 million tonnes of coal in 2005 up by 30% over last year. CRMs gross revenue is expected to come to 91.0mn reais ($38.8mn) this year, up 40% compared to 63.1mn reais in 2004.
"This is a great moment for coal and the outlook is promising for the next few years, when we will increase our sales to Candiota III coal-fired power project," CRM president Mr Jo Carlos Vieira was quoted as saying by a local newspaper
CRM expects to increase coal production to 4.2 million tonnes starting 2009 to supply Candiota III, which is due to start operations in 2010
Arch Coal announces conversion offer period
Arch Coal Inc today announced that the determination period for the conversion premium to be paid in connection with the company's conversion offer for its 5% Perpetual Cumulative Convertible Preferred Stock has concluded.
Each share of preferred stock validly tendered and accepted for conversion will be converted into an aggregate of 2.4424 shares of the company's common stock, which includes a conversion premium of .0439 shares.
On December 1, 2005, Arch commenced an offer to pay a premium to holders of any and all of its 5% Perpetual Cumulative Convertible Preferred Stock who elect to convert their preferred stock to shares of the company's common stock subject to the terms of the offer. The offer is scheduled to expire at 12:00 midnight on Friday, December 30, 2005.
China's Tianjin Port to handle 240 million tonnes cargo in 2005
Tianjin Port, one of northern China's major ports said that its cargo turnover is expected to increase to over 240 million tonnes this year. In 2004, the port handled 200 million tonnes.
The company said that it expects to handle 4.8 million twenty foot equivalent units of containers in 2005, up from one million units from last year.
Tianjin Port mainly handles iron ore, crude oil, chemicals and coal.
Algoma Steel pays $50 million in advance to reduce tax liability
Algoma Steel Inc announced that it has made a $50 million contribution to its pension plans in December, primarily as a pre-payment towards 2006 contributions, to reduce 2005 income taxes and generate higher returns.
The company said that the pre-payment is expected to reduce the income tax provision for the fourth quarter by about $11 million due to the deductibility of the contribution. But the income tax provision rate will increase in the first nine months of 2006 when Algoma won't be making its regular monthly pension contributions
Algoma, Canada's third-largest steelmaker has locked horns with its largest shareholder, New York-based Paulson & Co., which is trying to force Algoma to distribute hundreds of millions of cash to all its shareholders.
