July, 17 2006
Bangladeshs committee submits recommendations on TATA proposal
Bangladesh governments negotiation committee on TATA's proposed investment plans in the country recommended yesterday that the gas price at no point of time will be less than the prices offered by international oil companies.
Mr Mahmudur Rahman Energy Adviser told newsmen that the committee has finalized the report on the basis of the revised proposal offered by TATA. He said The negotiation committee did a great job by keeping the country's interest on top. By the end of this month, the report will be submitted to the high powered ministerial committee which would then put forward it to the cabinet for final consideration. TATA told us that they are ready to reinitiate the negotiation. We will convey the cabinet decision to TATA which will then decide whether they will invest or not.
TATA had announced suspension of its $3 billion investment proposal in Bangladesh as the government told it that Bangladesh will not go for any deal before the upcoming election.
GSHL interested in several countries for global expansion
Global Steel Holding Limited is reported to be looking at steel facilities in several countries to increase its global presence. Mr Suman Das Sharma GM of communication strategy of GSHL during an interview with Reporter.gr outlined the current position of the company and revealed companies interest in various countries.
Mr Sharma said Global Steel has acquired a 51% stake in Lucovac coke plant in Bosnia. In Bulgaria, we are present since 2005, when we took over Kremikovtzi Corp. Once we took over Kremikovtzi Corp, we introduced a renovation plan, so that soon enough it would produce its full capacity, which is 2 million tons.
Mr Sharma said that GSHL is interested in getting a foothold in the Greek market without giving further details. It is reported that he sadi that GSHLs plans also include Northern Africa, MEA, CIS and Central & Eastern Europe.
Global Steel Holding Limited already has operations spread across 7 countries including India, Nigeria, Libya, Zimbabwe, Philippines, Bosnia and Bulgaria with steel making capacity of more than 15 million tons.
GAIL & CIL join for CTG project
Gas Authority of India Limited and Coal India Limited have formed a 50:50 JV to execute India's first above ground coal gasification project at an estimated cost of Rs 2,400 crore. The two companies will now set up a joint working team to evaluate the scope of major business components. It is also to undertake a techno-economic analysis and work out a project implementation mechanism with time schedules for each stage.
Preliminary studies estimate the project to require an assured supply of 5,900 tonnes of coal a day. The plant will have a capacity of 7.76 million standard cubic meters per day of synthesized gas or 3000 tonnes per day of ammonia with a calorific value of 2560 Kcal/k. The prospective sites include Talcher in Orissa, Karanpura in Jharkhand and Durgapur & Haldia in West Bengal.
The cost of production of gas through this process is estimated at Rs 6,250 per tonne as against Rs 8,600 per tonne of natural gas. Clean coal technologies are now being seen as the only way to bridge the 41.4 billion cubic meters projected shortfall of natural gas in 2012. Other technologies like underground coal gasification, coal bed methane and offshore gas hydrates are also being developed.
Haldia to complete EIA for 2 jetties soon
It is reported that the environment impact assessment study by Indian Institute of Port Management for two waterfront multipurpose jetties at Haldia is about to be completed.
The Haldia Dock authorities will thereafter apply to get environment clearance from the State Environment Department for smaller jetty estimated to cost a little less than Rs 50 crore and from Union Environment Ministry for bigger one estimated to cost around Rs 100 crore.
TATA Agrico increases reach through DCMs Hariyali Kisaan Bazaar
TATA Agrico, the agricultural implement division of TATA Steel, has entered into a business venture with Hariyali Kisaan Bazaar, a rural initiative of DCM Shriram Consolidated in North India. According to the arrangement, TATA Agrico's product would be available at all the Hariyali Kisaan Bazaar outlets across North India with products like powrah, sickle for the farmer community.
Hariyali Kisaan Bazaar was aimed at empowering the farmer by addressing to all his occupational requirements like availability of quality agricultural inputs like seeds, pesticides, fertilizers, implements and agronomy services, contract farming, credit to farmers, among other activities. Presently there are 28 Hariyali Kisaan Bazaar outlets in North India, spread across in the states of Punjab, Haryana, Uttaranchal, Uttar Pradesh and Rajasthan.
CCEA approves PGCILs 2 transmission projects
Indias Cabinet Committee on Economic Affairs has approved two transmission projects of Power Grid Corporation of India Ltd entailing a total investment of Rs 5,778.47 crore last week. The approvals are for Rs 5,221.23 crore project for strengthening the Western grid and transmission line for NHPC's 520 MW Parbati-III hydropower project in Himachal Pradesh at a cost of Rs 557.24 crore. The Western region scheme would be commissioned within 48 months while the Parbati-III transmission line would be completed within 42 months
The Western grid scheme is being implemented in two parts. While the first part would be executed by PGCIL at an investment of Rs 3,581.40 crore, the second would be implemented through 100 per cent private sector participation at a cost of Rs 1,639.83 crore.
NHPC is setting up the 520 MW Parbati-III power project in Kullu district of Himachal Pradesh. The generation project is scheduled for commissioning in November 2010.
BEML to supply mining equipments to Tunisia and Syria
Bharat Earth Movers Limited has bagged orders valued at Rs 42 crore for supply of mining equipment and spares from Tunisia and Syria. The machines comprising 85 tonnes rear dump trucks and motor graders would be deployed by customers CPG in Tunisia and Gecopham in Syria for their opencast mines and rock-phosphate projects.
BEML has been expanding its overseas markets with focus on Latin America, Africa and Indonesia. It has started overseas sales and service offices in China, Singapore and Morocco. It has crossed Rs 61 crore export turnovers in 2005-06 and set an ambitious export target of Rs 121 crore for 2006-07.
Anpara C thermal power plant gets coal linkage from NCL
UP Power Generation Corporation has signed an agreement for its coal linkage for 1,000MW Anpara C thermal power project with the Northern Coal Fields Ltd. As per the agreement, the NCL will supply 3.6 million tonnes of coal every year from its Kharia coal fields in Jharkhand. This would facilitate financial closure and award of bids.
The bids for the project were opened here on June 7 and the project is likely to be awarded by September. Only three companies, Reliance Energy, Essar and Lanco have submitted bids for the project. All the three bids, containing technical and financial documents, have been sent to Ernst and Young for evaluation. Ernst & Young will prepare an evaluation report and present it to the evaluation committee.
Texmaco secures orders for 4,830 million
Texmaco Ltd has informed that its Heavy Engineering Division has secured 2 orders worth Rs 4,830 million for supply of equipments.
The first order for hydro mechanical equipment from National Hydroelectric Power Corporation is worth Rs 2,960 million. The 2nd order for container flat wagons from Indian Railways is worth Rs 1,870 million.
Global ferrous crap metal market to remain firm
According to speakers at the British Metal Recycling Associations annual meeting the world market for scrap steel appears buoyant and looks set for further increase.
It was noted that electric arc furnace steelmaking, the main market for ferrous scrap, has been growing at around 5% per annum over the past ten years and in 2005 world production topped 360 million tonnes accounting for 32% of total global steel output.
Mr Lindsay Millington DG of BMRA said Market prospects are looking good for our industry. But buoyant markets can also bring problems. Credit insurance limits are not keeping pace with higher prices; while increased cash handling means our members have greater exposure to currency fluctuations. The recent Bureau of International Recycling conference in Beijing indicated that these are worldwide problems, restricting the volumes that traders can handle, at a time when purchasing volumes are at record level.
UK is currently the fifth largest exporting country for ferrous scrap, behind the USA, Russia, Japan and Germany.
CBRC warns investment risk in power, coal & steel sector
Mr Liu Mingkang chairman of the China Banking Regulatory Commission while speaking at a conference on Chinese financial situation in the first half of this year said that Chinese banks and other financial institutions should pay special attention to investment risks in power, coal, steel, real estate, auto and transportation industry. He said that the overcapacity problem and adjustment of industrial structure in these industries may increase credit risks of banks.
He said that banks should pay intensive attention to possible risks concerning loans to enterprises with high level energy consumption and pollution, because these enterprises may face operational difficulties under circumstances of fuel price hike and governmental macro-control policy.
He also said that as China continues its reform on financial systems, banks are facing more market risks that may be brought by fluctuation of exchange rate, innovation of financial products and gradual marketization of interest rate.
BlueScope turns around US based Butler unit
BlueScope Steel Ltd said on that its Butler pre engineered steel building unit in the United States had recorded its strongest profit since 2004.
Mr Kirby Adams CEO said "This is an impressive management turnaround and we are very enthusiastic about the even greater potential of our larger North American businesses."
BlueScope Steel Ltd bought the Butler business two years ago for $221 million when Butler was near bankruptcy. It posted a $15 million loss before interest and taxes in fiscal 2005.
Rosneft IPO rakes in $10.4 billion
Bloomberg News reported that OAO Rosneft, Russia's state oil company, raised $10.4 billion in the world's 6th biggest initial public offering amid record prices for crude. Rosneft sold 1.38 billion shares at $7.55 apiece. The Russian government gets US$8.5 billion from the offering and Rosneft raises about US$1.9 billion. The sale values Rosneft at $79.8 billion. Russian President Mr Vladimir Putin built Rosneft into the nation's No. 3 oil producer using assets seized from OAO Yukos Oil Co.
Other oil companies ordered about 21% of the shares on sale, while foreign money managers bid for about 36% of the offering, the company said. Individual investors in Russia ordered about 4% of the stock. BP Plc, Malaysian state oil company Petronas and China National Petroleum Corp bid for Rosneft shares in the IPO. ONGC Videsh Ltd had also shown interest for 5% stake in Rosneft last week.
ABN Amro Rothschild, Dresdner Kleinwort, JPMorgan Chase & Co, Morgan Stanley and OAO Sberbank managed the IPO.
Shell & Shenhua to invest $6 billion in CTL venture at Ningxia Hui
The Economic Observer has reported that Shell Gas and Power Developments BV and Shenhua Ningxia Coal Industry Co Ltd will jointly invest $6 billion in a coal to liquids plant in northern China's Ningxia Hui Autonomous Region. China will hold the majority stake in the project.
Shell will offer its proprietary techniques for the project and a preliminary feasibility study on the project will be completed within three years.
As per reports Shell has sold 15 licenses for its coal gasification technology to Chinese companies and is currently constructing a joint venture plant with China Petroleum & Chemical Corp Sinopec.
Noncon nickel project in Philippines likely to restart soon
A Chinese group led by Jinchuan Group Ltd is expected to soon open a nickel refinery in the Philippines to capitalize on the present record high price of the metal. Jinchuan, Baosteel Group Corp and China Development Bank have signed a MoU with the Philippine government and Philnico Industrial Corp to resolve debt issues over the long closed Nonoc plant. The project is expected to commence soon.
The Chinese companies may invest several billion US dollars in the project, according to the Shanghai Securities News.
The Nonoc nickel project near Surigao city is the Philippines' largest nickel mine with 144 million tons of reserves. It was shut down in 1986 for financial reasons.
SA Eskom announces R97 billion CAPEX for 5 years
South African state owned electricity utility Eskom has approved a scaled up capital investment program of R97 billion for the next five years and has incorporated plans that will more than double its generation capacity over the next 20 years. Eskom plans to fund at least 50% of its CAPEX program from cash generated from its operations and balance coming from local and international borrowings.
Mr Thulani Gcabashe CEO while delivering the group's annual results in Johannesburg last week said that 67% of its budget would be spent on increasing the country's generation capacity, 15% on strengthening the transmission network, 16% on distribution and the balance would be made up by corporate and new business spending particularly on hydro projects in Mozambique and the Democratic Republic of Congo.
USs Steelmakers start Chiredzi coal mine in Zimbabwe
USs Redcliff based steel manufacturer Steelmakers owned newly formed Coal Zimbabwe has invested $5.3 million in a mine in Chiredzi in Zimbabwe and plans to go into power generation in the near future. Steelmakers said that it ventured into mining in a bid to revive its Masvingo sponge iron plant which had been closed because it was not getting sufficient supplies from the Hwange Colliery Company. So far the mining concern has produced 15 000 tons of coal since it opened a month ago and hopes to undertake an expansion program.
Mr Alexander Johnson Steelmakers group GM told media "We had to close our Masvingo plant because we were not getting enough coal supplies from Hwange Colliery Company. As a result we decided to go into coal production also as a way of reducing production costs."
Mr Johnson said tests conducted so far show that their coal was of superior grade with low sulphur and phosphate content. He said there were also plans to increase production to 50 000 tons in the next six months when the company constructs washeries meant to improve the coal grade. He said the new mine based in the Mukuvisi area of Chiredzi should go into power generation in the future, subject to the approval of the board.
The 2 500 hectares area is believed to have an estimated 500 millions tonnes of coal. Steelmakers operations manager Mr Bade Prabhakar said they expected to start full scale coal mining in the next month after the completion of feasibility studies. Mr Prabhakar said the anticipated lifespan of the coal mine was 100 years with initial monthly coal production expected to be 20,000 tonnes before significantly rising in relation to demand.
Zimbabwe consumes 320,000 tons of coal a month but HCC has not been able to meet demand.
Viatnams Dung Quat port starts construction
Construction of the largest deep water seaport in central Vietnam began Saturday in Quang Ngai province. The VND575 billion ($35.9 million) Gemadept Dung Quat International Port is designed to receive 30,000 tonne vessels with an annual capacity of 1.5 million tonnes to 2 million tons.
Upon the completion of the first phase of the project in the second quarter of 2007, the port will distribute various kinds of cargo, including materials, machines, coal, fertilizer, garments and textiles, and furniture.
Once fully operational, it will serve the Dung Quat Economic Zone.
Bangladesh Coal policy under approval
Bangladeshs energy and mineral resources division has sent the draft of the proposed coal policy to the Cabinet for approval. Expert said that the policy is export oriented and tilted heavily in favor of foreign companies.
Under the proposed policy any company will be allowed to export double the volume of coal that would be consumed in the country. This provision will remain for the first 10 years after the coal policy comes into effect. The company will be allowed to export the same amount of coal that would be consumed in the country annually 10 years after the policy comes into effect. It means the ratio of domestic consumption and export will be 1:2 in the first 10 years and 1:1 after 10 years.
The policy also provides an option for the method of coal extraction - shaft or open pit. It is feared that foreign companies like Asia Energy and Tata which are in a race to get their grips on Bangladeshs coal resources will be going for open pit method of mining to make maximum profits. But this method of mining can be dangerously unsafe from the environmental perspective. Apart from greater polluting effects, the same will also increase the risk of serious land subsidence.
The geologists and economists have serious reservations about it. Geologists and economists are of the view that energy security will be under a threat if the policy is approved as it will reportedly allow more than half of the country's coal to be exported.
The proposed policy has stressed on foreign investment. The rates of royalties are considered by experts as pittances as compared to the amount of profits the foreign companies would be making by exporting coal. But the proposed coal policy has encouraged aggressive extraction of coal to facilitate foreign companies to make export.
PSMC Privatization - Ministry waits for revamping proposal
Pakistans ministry of industries in response to a Dawn report of July 14 has clarified that as no proposal for revamping the Pakistan Steel Mills has so far been received from the mill management, the question of having agreed to the proposal does not arise. It said that the PSM management would have to present the proposal before its board of directors before submitting it to the ministry.
However PSM Chairman Gen (Eetd) Abdul Qayyum said that he had sent a detailed proposal to the ministry. He added that the Pakistan Steel Mills management, experts and engineers felt that the revamping was necessary before privatization of the biggest industrial unit of the country. However, he said that everything would be done according to the guidance to be given by the Council of Common Interests.
Russian Ufaleinickel to increase nickel output in 2006
Russia's second largest granulated nickel and cobalt producer Ufaleinickel announced last week that it will increase its nickel output in 2006 by 18%-27% as compared with 2005 to 13,000 tonnes to 14,000 tonnes.
Ufaleinickel became part of the Industrial Metallurgical Holding in 2005, which combines the Kemerovo Coke Plant, Tulachermet and Rezhnickel. As a result Ufaleinickel now has ensured coke supplies, the shortage of which caused serious production problems in the past.
Ufaleinickel has its own Serovsky nickel mine in the Chelyabinsk region. It also produces cobalt under a tolling agreement with Norilsk Nickel.
SUBAs sinter production down by 6.9% in H1 of 2006
Ukrainian Pryvat Group controlled Sukha Balka reduced sintered ore output to 1.5 million tonnes in the frist half of 2006 down by 6.9% YOY over January to June 2005.
SUBA supplied 0.2 million tonnes of sintered ore to SCM controlled Azovstal, 0.29 million tonnes and 0.06 million tonnes to IUD controlled DMKD and Alchevsk respectively during this period.
SUBA produced 3.24 million tonnes of sintered ore in 2005
Investment funds to exit from Romanian Otelinox
It is reported that a number of Otelinox Targoviste shareholders including Broadhurst investment fund and the Property Fund have filed for exiting from the company as Otelinox Targoviste shareholders decided to have the company de listed from the Bucharest Stock Exchange during an Extraordinary General Meeting on May 10 and approved a 12 RON price per share to repurchase the interests of those investors wishing to leave.
Broadhurst Investments Limited's interest in Otelinox stands at 14.26% (1.52 million shares) and will get 18.24 million RON (Euro 5.1 million). The Property Fund owns 5.34% or 569,344 shares and will get 6.83 million RON (Euro 1.9 million).
Other major shareholders to have submitted requests to withdraw from the company include SIF Banat-Crisana having 0.24% stake.
Trade union allege safety violations at Mittal Steel Galati
It is reported that the management of Mittal Steel Galati has been accused by trade union representatives of putting employees lives at risk through lack of attention to safety procedures. Last month one worker died and three others were injured after being set ablaze at plant's oxygen unit. The three survivors are still in critical condition. There have been six fatalities at the plant so far this year as per state safety inspectors.
A report in The Sunday Telegraph puts the number of workers killed at 25 and injured at 254 since it was acquired in late 2001 by Mittal Steel. The company disputed the inspectors' death and injury figures, but admitted that over the same five year period 17 employees have died from accidents and another 203 have suffered injuries which prevented them from working.
Mittal Steel Galati is reported to have sacked 5 managers in response to the most recent incident, which it blamed on safety procedures not being applied. A company spokeswoman said "We take safety extremely seriously and leadership must be accountable for ensuring that employees follow the safety procedures set out at all times. We have put great emphasis on reducing the injury rates with considerable success. Prior to Mittal Steel's ownership the average number of lost work day injuries per year was 147. In 2005, this had been reduced to 32, an improvement of 79%."
However trade union officials are reported to be disagreeing and Mr Gheorghe Tiber a lawyer with the Steel Workers Solidarity Union who worked at the plant for 23 years is threatening to take the company to court over the latest accident which he blamed on poor management and lack of effort to improve safety condition
So far this year, the plant has been fined 30,000 by state inspectors for disregarding safety rules. Mr Nicolae Dantes Bratu deputy head of Romania's state safety inspectorate said that "The fines have been given for not regularly checking equipment, for improper technology, for not checking employees' health and for inadequately marking dangerous areas."
Chinese molybdenum demand to go up by 20% in 2006
China's domestic consumption of molybdenum is set to increase by at least 20% this year as strong demand from steel plants is continuing amid tight domestic molybdenum concentrate supplies. The demand for molybdenum for the production of steel pipelines was also rising in China, leading to continuing growth in molybdenum consumption in the domestic market.
An official from China's largest molybdenum producer Jinduicheng Molybdenum Mining told Platts last week that China consumed about 19,800 mt of molybdenum last year. However JDC has no plans to increase its molybdenum output due to limited ore dressing capacity. JDC is expected to reach a molybdenum output of about 23-24 million lb in 2006.
Yukon Gold to acquire Andrew zinc project in Yukon
Yukon Gold Corporation Inc announced last week that it has entered into negotiations with a Yukon based prospector to acquire a 100% interest in the Andrew zinc property located in the Mayo Mining District of the Yukon Territory in Canada. The transaction is subject to a formal agreement and certain performance obligations of both parties being met. The transaction must also meet all regulatory approvals.
The Andrew property is made up of 148 contiguous quartz mineral claims totaling 2550 hectares.
Mr Paul Gorman VP of business development said "The Andrew acquisition would be a very nice fit for the Company to expand and diversify our operating base in the Mayo Mining District. Our corporate objective to acquire quality projects that possess great potential holds true with this opportunity."
Yukon Gold Corporation Inc is an active and progressive public exploration and development company. The Company's main focus is its recently acquired VMS deposit Marg Property and its Mount Hinton gold and silver exploration project in the Central Yukon Territory of Canada.
Mhag to make 2nd shipment of iron ore to China in August
Brazilian mining company Mhag plans to ship its second cargo of iron ore to China in the second half of August after heavy rains forced it to temporarily halt shipments due to transport problems along the Piranhas river near its Jucurutu mine in Rio Grande do Norte state.
The second shipment from Suape port in Pernambuco state is expected to come in at 75,000 tonnes. Following the next month's shipment, Mhag would start shipping iron ore cargos to the Asian country every 45 days.
Mhag has exploration rights in Paraa and Rio Grande do Norte states. The company aims to produce 800,000t of iron ore in 2006 and 2 million tonnes in 2007.
GSHL reported to be interested in Bulgarian football club FC CSKA
Bulgarian news agency has reported that Mr PK Mittal owner of Global Steel Holding Ltd is interested in taking Sofia based Bulgarian football club FC CSKA and that he visited CSKA's stadium in Sofia on Saturday to assess the current state of the sports facilities.
FC CSKA is undergoing a deep crisis after its chief Mr Vassil Bozhkov of Nove Holding quit the competition for the National Cup, dramatically cut the budget and opened all players sale off, although CSKA had won the Bulgarian Cup for 2005-06.
Global Steel Holding Ltd, a part of the Ispat Group, purchased Finmetals Holding the owner of a 71% stake in Sofia based metallurgical plant Kremikovtsi in August 2005.
