November, 13 2006
Coal ministry suggest BG to ensure timely development of coal blocks
It is reported last week Indian government plans to ask both public and private power companies to submit a bank guarantee due to delay by power generating companies in developing captive coal blocks to discourage non serious players from seeking coal blocks for setting up power plants. Government has also warned of canceling their allocation if the coal mines remain unutilized.
As per reports, the coal ministry has suggested that all generating firms would have to submit a bank guarantee of a reasonable amount which be encashed if the companies failed to meet important deadlines related to the development of the block in addition to cancellation of allotment of the block itself.
The milestones for development would not also include the progress in power project in terms of awarding the turnkey contract and delays construction of the power project. While these suggestions would ensure that power companies develop the coal blocks expeditiously.
PSA-Sical secures LoI to develop Chennais 2nd container terminal
Sical Logistics and PSA Singapores JV PSA-Sical has received a LoI to develop the Rs 492 crore second container terminal at Chennai port on build, operate and transfer model. It would take two years to fully develop the Greenfield project but the company would be able to handle containers in a year's time.
The project involves developing a new container terminal at the modernised East quay and South quay. Chennai Container Terminal, the existing private terminal, achieved a record throughput of 700,107 twenty foot equivalent units for the calendar year 2005. Once the second terminal comes up, the port can handle an additional 100,000 TEUs in the first year and 600,000 TEUs within five years of operation.
PSA Sical would pay 45.801% as its revenue share for the project to the Chennai Port Trust and a Mou between PSA-Sical and the port trust would be signed in a couple of months after payment of upfront fee to the port trust. The port trust will contribute around Rs 100 crore for the project towards dredging and reclaiming land and the rest of the funds would be brought in by PSA-Sical.
Power plants in SEZs to be put at par with others
It is reported recently that the up coming power plants in special economic zones will have to sell 75% of the power generated to the the units located within SEZ and he balance 25% power will have to be sold at a rate that no undue benefit or profiteering occurs to these power units and the units in the domestic area are not at a disadvantage.
It seems that this proposal stems from the fact that power units in SEZs get huge customs and excise benefits on the plant and machinery which are not available to their counterparts in the domestic tariff area.
These guidelines will address the concerns, which were expressed when some of the players had announced power plants in SEZs with capacities much higher than what could have been the requirement of that SEZ.
GCPB approves annual program of GSI
The 41st annual meeting of the Central Geological Programming Board consisting of representatives of central & state government, Public Sector Undertakings and some private agencies was recently held under the chairmanship of Mr AKD Jadhav secretary to the ministry of mines. CGPB reviewed the achievements of the projects undertaken during 2005-06 and discussed & approved the Annual Programme of the Geological Survey of India for 2006-07.
The Annual Programme 2006-07 has been intended to initiate the era of marked change in the organization. In the era of growing competition, a number of changes must be adopted in the system, process, structure and culture to get transformed to a highly effective modern organization equipped with latest technology and equipment. Coming couple of years would be the turning point in the annals of GSI in terms of its productivity as resource survey-cum-research organization and creating nations data base on the dynamic Earth System by acquiring the latest technology and equipment for land, aerial and marine survey systems with matching laboratory excellence.
CGPB is the apex body at the national level to overview the programme of geoscientific activities including mineral exploration in the country.
Mr Ola calls for input from stakeholeders
The 28th meeting of the Mineral Advisory Council, which is the apex think tank for mining and the mineral sector for non fuel minerals was held on 6th November 2006 after a gap of four years.
Mr Sis Ram Ola minister of mines while inaugurating the meeting of the council outlined the opportunity of closely interact between state governments and other stakeholders of the industry in evolving a new mineral policy and brining about amendments in the Mines and Minerals Development & Regulation Act, 1957 in the interest of growth of nation by streamlining and simplifying the procedures to reduce delays apart from other measures to increase the investment in the mining sector.
Mr Ola called upon the state government and industry to actively participate in development of the mineral sector in view of the changed global scenario wherein the investment was flowing into those countries which had not only the mineral potential but also an investor friendly regulatory regime.
Mr Ola called upon the state government and industry to give their valuable inputs on the recommendations of the high level committee, which have been considered as an important step towards development of the mining sector by the Prime Minister.
Indian Mining sector had a total production of Rs.75,000 crores contributing to 2% of GDP.
Ramswarup Industry focusing on exports
It is reported that Kolkata based Ramsarup Industries profit after tax for July to September 2006 quarter has increased by 53.28% to Rs 8.17 crore and for the half year it has gone up by 41.28% to Rs 18.38 crore. Its net sales during July to September quarter have increased by 12.16% to Rs 272.12 crore and during the half year by 29.74% to Rs 584.34 crore.
Ramswarup Industries has decided to focus on the export market in Africa and other neighboring countries and its export sales have grown by about 314% for the quarter ended September 30 at Rs 16.7 crore.
Mr Ashish Jhunjhunwala MD of Ramswarup Industries said "We see a strong opportunity in the export side and are scouting for further contracts, other than the ones we already have in hand."
Queensland to build Australian $1 billion coal port
The state government in Queensland, Australia has announced plans to build a coal export terminal at Wiggins Island. The cost of initial construction phase will be Australian $1 billion.
A constant rise in coal demand and other bulk commodities from Asia led to congestion at at Queensland's ports. The enable the miners to need the increased demand, this port is planned. The port will be completed 2011.
The expansion will ensure that there is an outlet for so far undeveloped coal deposits in the Surat and Bowen basins such as AMCI Australia's Belvedere deposit and Macarthur Coal's Monto site as well as allowing existing operations to expand.
Sandvik to supply SS pipe to weatherford
Sandvik has won a multi million pound contract to supply stainless steel pipe for expandable sand screen to Weatherford Completion and Production Systems in Aberdeen. Weatherford offers Completion and Production Systems for oil and natural gas fields.
The contract is for a five-year period. During this period Sandvik will maintain stocks at its Halesowen warehousing facility in the West Midlands, in order to supply pipe on a call-off basis to meet Weatherford's production schedules.
Pipe for the contract is being supplied in austenitic stainless steel grade AISI 316L in double random lengths and coupling material is supplied in super duplex grade Sandvik SAF2507.
Molten metal spill slows steel mill operations
In an accident that took place at Lorain's steel mill spilled molten metal. This was followed by a fire. There were no casualties in this accident. The accident caused slowdown in production.
In the bloom caster, hot molten steel is made into solid products through a series of molds. The liquid steel was in a large ladle which was being poured into a cast. The mechanism to the pouring malfunctioned which caused the spill. As a result of this spill bloom caster is shut down but the billet caster was running.
Republic Engineered Products located at Lorain, Ohio in US is owned by Republic Steel which is a leading North American supplier of steel bars. It is one of the few integrated steel mills left in the US.
Mittal Steel SA expects pricing ruling next year
Mittal Steel South Africa recently said that it expects a ruling from South Africa's Competition Tribunal on alleged excessive pricing case by South Africa's gold miners Harmony and DRDGold early next year.
According to Mittal Steel SA, closing arguments will be made at the end of November. Mittal Steel SA in its latest quarterly report for the three months to end September said, "We maintain our view, based on advice from senior counsel that no significant exposure exists in this regard.
The ricing mechanism battle has been going on for over four years since September 2002 when the two companies lodged a complaint with the South African Competition Commission against what was then known as Iscor.
Scrap trade to remin strong BIR
Bureau of International Recycling has said the world's appetite for scrap steel continues apace despite China's investment two years ago in a blast furnace for producing steel from ore as substantial new electric arc furnace capacity is being added in Turkey and a number of other countries.
Mr John Neu of US based Sims Hugo Neu and member of BIR Ferrous Division board said that It is clear that scrap has not gone out of style. Mr Neu said that international consumption of scrap remains at a high level and said "Scrap prices will probably increase in December and certainly in January when consumers replenish for the winter ahead.
Mr Anton van Genuchten of TSR GmbH & Co KG also suggested that prices would remain at least stable until the end of this year, with some grades likely to have upward potential due to short term local shortages. He said that EU 25 exports of ferrous scrap to Turkey had soared by 124.1% in the first half of 2006 to 2.378 million tonnes.
Mr Denis Ilatovskiy of Mair Joint Stock Company in Russia reported that Russia has recorded a sharp upturn in domestic scrap consumption following the addition of significant electric arc furnace capacity. As a result, the countrys scrap exports are expected to fall to no more than 2 million tonnes by 2008. He added that domestic collection volumes were also falling because of a dwindling supply of easily obtainable scrap.
Mr Colin Iles of EMR in the UK noted the fundamental shift in scrap flows and suggested a reduction in exports from Russia and the Ukraine would boost scrap sales into Turkey by EU and US East Coast exporters. He also contended that as the world steel industry moved increasingly towards consolidation it will quite naturally try to control its supply chain.
Chinese steel prices in Domestic market stabilizes
The prices of austenitic flat rolled stainless steel is stable in Chinese domestic market prices. There has been an increase or more than RMB 950 per tonne since mid October. Traders in southern China inform that buyers are carefully purchasing material to limit inventory as buyers want to limit stocks on hand rather than risk losses if high market prices do not sustain.
Morales not to compensate oil companies
Mr Evo Morales president of Bilivia announced that it will not compensate energy companies such as Spain's Repsol YPF SA and Brazil's Petroleum Brasileiro SA for the nationalization of oil and gas reserves. Mr Morales during a recent meet of Ibero-American leaders at Montevideo in Uruguay said that We have tried to recover our natural resources without expelling anybody, without confiscation, and we have the right to not compensate anybody.
Morales has nationalized the nation's oil and gas reserves and negotiated new contracts with all energy companies that have interests in Bolivia including Repsol, Brazilian state controlled Petrobras and France's Total SA. Morales said Bolivia may expel companies that are not following the country's rules.
Mittal Steel SAs CAPEX likely to get delayed.
It is reported that Mittal Steel South Africa is unlikely to start its R8 billion capital program this calendar year due to new environmental impact assessment related delays.
Mittal Steel SA went through a full EIA process, which included the public participation process and the appeal period, but a late submission made subsequent to that by an environmental group had been accepted by the authorities. The objections were wide ranging and a thorough counter submission is now being prepared by Mittal Steel SA.
Mr Rick Reato CEO of Mittal Steel SA told Engineering News last week that it had still not received a record of decision for its expansion program, as the authorities had agreed to accept a late objection. Mr Reato had earlier this year acknowledged that the company had underestimated the time necessary for environmental approvals.
Mittal Steel SAs R8 billion CAPEX is designed to lift output by 2.5 million tonnes to 9 million tons a year by 2010.
UK Coals JV to develop commercial properties on old sites
UK Coal will unite with JV partners to develop its old sites into commercial uses and housing. It said that it will manage the process of disposal by phasing the release of the sites, and then reinvest any proceeds from selling off land in the development phase of the sites.
The company said its 49,500 acres has the potential for 14,000 homes and 25 mln sq ft of commercial space, leading to an aggregate value of 800 mln stg over the next six years. The money generated from land development will be held principally for land development because of the nature and capital cost of putting new coal mines in, company directors said.
UK Coal said that despite the windfall most of its property portfolio was off balance sheet and thus would not affect its results, after it said last month it would make a loss for the full year. Mr Chris Mawe director finance said that The full year loss won't be impacted by this. The valuation we're going through at the moment is off balance sheet. The current red book value is 274 million stg but the majority of that isn't on the balance sheet now.
LionOres profits soar in Q3
LionOre Mining International Ltd has reported its third quarter 2006 financial and operational results. Its group production on 100% basis of 7,812 tonnes of payable nickel at a cash cost of $3.79 per lb as against 7,872 tonnes of payable nickel at a cash cost of $3.01 per lb in Q3 of 2005.
Its net mineral sales in the quarter amounted to $276.7 million as against $88.9 million in Q3 of 2005 and net earnings to $148.1 million as against $7.9 million in Q3 of 2005, includes $25.0 million recorded as income for the net proceeds of a break fee resulting from the termination of the proposed acquisition of the Nikkelverk Refinery.
Mr Colin Steyn president and CEO of LionOre said, "I am pleased to announce that LionOre has achieved a record profit for the second consecutive quarter, earning $148.1 million or $0.68 per share. LionOre's earnings have been bolstered by the high nickel price and achieving group production.
Downers Roche Mining bags coal contracts from Xstrata
Downer EDI Limited recently announced that its Roche Mining division had negotiated a new agreement with Xstrata Coal for the development of two new processing plants to service Xstrata Coals Mt Owen and Liddell operations in the New South Wales Hunter Valley.
Downer said in a press statement that the Mt Owen plant is set for completion by early 2008, with Liddell staggered to complete approximately three months later.
APST moves for environmental clearance for seamless tube mill
Boulder Steels subsidiary Asia Pacific Seamless Tubes has lodged an environmental impact statement at Ipswich council's for a $580 million steel mill west of Brisbane. Construction of the proposed mill is to begin by June next year with the first steel production in 2009-10.
Asia Pacific Seamless Tubes is formed as a special purpose company with several Dubai investors for the construction of a mill at Ipswich and a second finishing mill in Dubai with a capacity to produce 400,000 tonnes of seamless tubes annually.
Mr Darryl Smith MD of APST said that there were no seamless steel tubes being produced in Australia. He said, "Once the steel mill is operating at full capacity, seamless steel tubes worth approximately $150 million a year will be replaced while exports will generate a further $350 million annually."
