May, 06 2007
JSWs WB project gets order for buying land
It is reported that West Bengal government has handed over the order for possession of 4,300 acres at Salboni in West Medinipur to JSW Steel for setting up a 10 million tonnes steel plant. The order excludes the 560 acres to 570 acres of land for which JSW is directly negotiating with the villagers.
According to the offer letter issued by the land department WB government is ready to hand over the land on a 99 year lease if the JSW Steel accepts its commercial terms and conditions. Mr Abdur Rejjak Molla minister for land and land reforms of WB said that the government wants INR 0.19 million per acre for the land. He added that they have to pay 95% of the price up front and pay a rent according to the prevalent rate there.
Mr Sajjan Jindal vice CMD of JSW Steel is expected to meet Mr Buddhadeb Bhattacharjee chief minister of West Bengal later this month to discuss the progress of the project and finalize the price the 4,300 acres of land.
With regard to the land, which JSW is planning to acquire on its own, Mr Biswadip Gupta joint MD & CEO of JSW Bengal Steel informed that the villagers have agreed to hand over their land. He said that the company has assured the villagers that they would be compensated for their livelihoods.
The project would be implemented through a special purpose vehicle, which will have an initial paid up and authorized capital of INR 100 crore. The JSW group holds 89% in the SPV, while the balance is held by the West Bengal Industrial and Development Corporation and the West Bengal Mineral Development and Trading Corporation. In the first phase of the project, JSW Steel plans to put up a facility of three million tonne. It would be subsequently ramped up to 10 million tonne at a total project cost of INR 35,000 crore.
Chhattisgarh signs 7 more MoUs for INR 192 billion investment
It is reported that the Chhattisgarh government has signed 7 more deals worth INR 192 billion for setting up steel units and power plants in the weekend.
The list includes the following MoUs
1. Jindal Steel and Power Ltd for bringing in INR 80 billion for installing an integrated steel plant, captive power plant and oxygen plant at Raigarh. It has already a sponge iron unit, steel plant and a 1,000 mw power plant under construction in Raigarh town.
2. Bhushan Steel and Power Ltd signed deal for investing INR 55 billion for setting up a steel plant with a capacity to produce 1.2 million tonne steel per annum at Raigarh. It also proposes to set up a 300MW power plant in the same place.
3. Monnet Ispat and Energy Ltd will pump in INR 20.8 billion for expansion of its Raigarh based steel plant, ferroalloys unit and coal beneficiation plant.
4. Vandana Ispat Ltd will invest INR 13.1 billion at its Raipur based existing steel unit.
5. Topworth Steel Ltd will invest about INR 12 billion for expansion of its unit at Borai in Durg district
6. MSP Steel and Power Ltd will pump in INR 8.5 billion at Raigarh
7. Salasar Sponge and Power Ltd will pump in INR 2.3 billion at Raipur.
Dr Raman Singh chief minister of Chattisgarh said that Chhattisgarh has emerged as a hunting ground for investors mainly for the steel and power sector players.
Supreme Court asks for report on underground coal fires in Jharia
The Telegraph reported that the Supreme Court has asked the central government to inform within 2 months the steps taken by it to combat fire and subsidence in the coalfields of Jharia and Raniganj. It has also asked a court appointed committee to give details of the work done by the government and coal companies.
The report added that the panel which submitted a report to the court after a trip to the area had said that it was not satisfied with the work which was to be done in accordance with the action plan prepared by the Central Mine Planning and Design Institute.
Supreme Court has been monitoring the central governments efforts to tackle the decades old fire in the mines since 1997, when then MP Mr Haradhan Roy moved a public interest litigation. Mr Roy had said that the central government had ignored his representations on the violation of the rights of people in Raniganj, Jharia, Asansol and Dhanbad. His petition mentioned that parliamentary panels on coal and energy had said the problem could lead to one of the greatest economic disasters in the country if not tackled immediately.
HZL raises zinc prices by 4%
Indian zinc major Hindustan Zinc Ltd has raised zinc prices by 4% or INR 6,900 to INR 180,900 a tonne effective immediately.
The price of lead has also been raised by 2.3% to INR 94,700 per tonne.
JSW Energy aiming for 5,000MW capacity
BS recently reported that JSW Energy will invest INR 15,000 crore in the next 2 to 3 years in thermal power projects for increasing its power generation capacity to 5,000 MW from the current 260 MW.
JSW Energy has already signed a MoU with Gujarat for developing a INR 4,800 crore and 2,000 MW imported coal based plant at Simar in Junagarh district and the land survey for the project has been completed and a consultant has been appointed for a techno economic feasibility study for this port based power plant.
JSW has also undertaken Brownfield expansion of two units of 300 MW each in Vijaynagar where it already has a 260 MW generation unit and operates and maintains another 290 MW facility. This plant is expected to be commissioned by December 2008 and would involve an investment of INR 1,860 crore which will be funded by IDBI.
A third imported coal based plant would be developed at Raigad in the district of Ratnagiri in Maharashtra. The plant capacity would be 1,200 MW and the investment close to INR 4,500 crore. JSW has already received the no objection certificate from the Maharashtra pollution control board and the ministry of environment and forests is expected to provide the certification soon.
JSW is in the process of setting up a lignite based 1080 MW power plant at an investment of INR 3,500 crore in Rajasthan and has already signed power purchase agreements with distributors in Rajasthan for 1000 MW, at a 30 year levelised tariff of INR 1.91 per unit excluding escalations. This project will have 8 units of 135 MW each, the first of which is expected to be commissioned by the Q4 of 2008.
Mr Raaj Kumar joint MD & CEO of JSW Energy said that it is looking at investing in hydel power plants in Himachal Pradesh and the north east, while extending its presence in the transmission and trading sector to become Indias largest integrated player in the power sector by the end of the 11th plan in 2012. Mr Kumar added that We have also been actively participating in bids for the development of a transmission network in the country and we already have an in house power trading wing, JSW Power Trading Corporation based in Delhi.
Mr Kumar added that the coal requirements would be 4 million tonnes for every 1000 MW thermal power generated and by 2010-11 the company would be importing approximately 15 million tonnes to 16 million tonnes of coal and JSW is looking at acquiring coal blocks in Indonesia to ensure fuel security.
Jindal Saw is upbeat on pipe outlook
Indian pipe major Jindal Saw has released an industry outlook as under.
Jindal Saw said that the pipe line industry has responded well to supply and distribution challenges and the growth in crude demand is resulting in tight pipeline capacities in various regions across the world while lack of capacity is likely to temper the distribution market resulting in fuel shortages and or retail price hike.
It added that Similarly, increased focus of the government of India and the civic bodies on improvement of the water and sanitation facilities is offering ample business opportunities to the companies supporting the water and sewage infrastructure.
Jindal Saw projects a significant growth in the SAW pipe, seamless pipe and ductile iron pipe business considering the increased E&P activities leading to higher demand of seamless tubes.
GMDC plans for 3,375 MW power generation capacities
It is reported that the Gujarat Mineral Development Corporation along with private players and state PSUs will set up 3,375 MW of power generation capacities at an estimated cost of about INR 15,000 crore. GMDC has already entered into an agreement with KSK Energy Ventures for setting up power generation capacities of 1,750 MW in Chhattisgarh and Maharashtra.
Mr CJ Jose CMD of GMDC said that As per our agreement KSK will supply 1,000 MW of power to Gujarat Urja Vikas Nigam, while the remaining 750 MW it can sell to anyone else. At INR 1.98 per KW, KSKs supply will be the cheapest source of electricity for the state. We have kept the benchmark price at INR 1.98 per KW and will consider any offer which comes below this rate. Otherwise, the remaining 1,000 MW project will also be awarded to KSK.
GMDC which has been a mining company till now will get transformed into a major mining and power conglomerate through various JVs. It has bid for another 10 coal blocks being offered by the central government for use in setting up coal-based power plants.
Container Crop to form JV for multi modal services
Container Corp of India Ltd is reported to be in talks with some shipping services firms to form a JV that for offering multi modal and door to door transport services.
Mr Rakesh Mehrotra MD of CCIL said that it has now plans to extend the partnership to coastal services after entering into a JV with private sector firm Transport Corp of India. Mr Mehrotra said that We have also envisaged a coastal shipping service with them, it would be a truly multi modal facility. We can expand this if needed and we are in talks with a number of shipping services firms.
Mr Mehrotra added that We had a growth in volume and our other expenses per twenty foot equivalent unit containers are down by 18% due to better efficiencies. The company hopes to maintain the rates, provided the Indian Railways dont increase it midway but we are working on a scheme on discounts where there is a committed volume.
CCIL already has a joint working agreement with the Seaways group for moving cargo by ship to Bangladesh and Myanmar. CCIL has also entered into a JV agreement with Gateway Distriparks to move containers from the latters depot in north India in March 2007.
Container Corp in which the Indian government owns 63.09% uses the Indian Railway network for operating its rakes and has a network of 57 container freight stations countrywide. It recorded a 25.1% rise in 2006-07 revenue to INR 3,114 crore and a net profit of INR 691 crore. It plans to spend INR 5 billion in 2007-08 on building container freight stations and also plans to add 4 freight stations this financial year to its existing 57.
HMT Machine Tools plans turnaround by 2007-08
HMT groups subsidiary HMT Machine Tools is expecting to make a turnaround in 2007-08 after securing an INR 880 crore revival and restructuring package. Of the revival package, INR 180 crore will fund investment in various units of HMT Machine Tools for refurbishing plants, modernizing foundries and upgrading machines which are almost 50 years old.
Mr AV Kamat CMD of HMT said that With cash infusion and waivers totaling INR 880 crore, the negative net worth of HMT Machine Tools will become positive and interest outgo will become zero. In this way, we are expecting to clean up our balance sheet within a year and make a turnaround in 2007-08.
HMT Machine Tools owns 5 manufacturing plants in the country and has prepared a blue print to implement an enterprise resource planning package to network all its plants. HMT Machine Tools has achieved INR 242.18 crore turnover and reported a loss of INR 6.56 crore in 2005-06 and it has posted INR 263.32 crore turnover in 2006-07 which is about 40% of the groups turnover of INR 611.09 crore. The final results are yet to be approved but sources said the losses have come down.
Panchmahal Steels Q4 earnings down by 72.45% YoY
Panchmahal Steel has announced that its earnings for the quarter ended March 31st 2007 was down by 72.45% YoY to INR 51.83 million as against INR 188.14 million for the corresponding quarter a year ago while its net sales for the quarter were increased by 66.19% YoY to INR 1,322.48 million compared with the corresponding quarter a year ago.
Panchmahal Steels operating margins were increased to 10.45% during the quarter a rise of 65.21 basis points compared with the corresponding quarter while net margins on the other hand, fell from 23.62% to 3.92% during the quarter.
GE Shippings 2006-07 net up by 7% YoY
Great Eastern Shipping Company has posted a consolidated net profit of INR 912.43 crore for the year ended March 31st 2007 up by 7% YoY as against INR 852.12 crore for the year ended March 31st 2006.
According to an official release issued by the company to the BSE, its total income has decreased to INR 2417.73 crore for the year ended March 31st 2007 from INR 2459.41 crore for the year ended March 31st 2006.
GE Shipping has also posted a net profit of INR 240.92 crore for the quarter ended March 31st 2007 as against INR 183.52 crore for quarter ended March 31st 2006 while its total income has recorded at INR 592.67 crore for quarter ended March 31st 2007 up by 7.83% YoY as against INR 549.88 crore for quarter ended March 31st 2006.
Bay Forge to increase 2007 turnover by 42% YoY
ET has reported that Italian Fomas Groups 100% subsidiary Chennai based Bay Forge is aiming to cross the INR 150 crore turnovers in 2007 after INR 63 crore in 2005 and INR 105 crore in December 2006.
Mr RC Mohan president of Bay Forge told ET that We expect to complete the utilization at the current capacity of the hydraulic press in about 2 months to 3 months time."
Me Mohan added that "We are a capital intensive organization having niche product areas involving a high knowledge quotient. Our further expansion program would be chalked out at the board meeting."
Bay Forge, set up in 1996, specializes in open die forging and large seamless rings. It took up an INR 100 crore expansions about 4 years ago and has utilized about 60% to 70% of the 15 acre space used to house its manufacturing facility.
Borusan and Socotherm form spiral pipe JV in Spain
Metal Expert reported that Turkish pipe producer Borusan Mannesman Boru and Italian pipe coating company Socotherm have signed an agreement to set up a JV named Borusan Mannesman Espana in Spain to produce 50,000 tonnes welded pipes per year at an investment of USD 16 million.
The new plant will be located at Hellin in South East of Spain adjacent to Socotherm Coating Mill which will provide coating of pipes produced by BM Espana.
Commercial output of spirally welded pipes of 711mm to 2,540mm diameter and 6.35mm to 33mm wall thickness is scheduled to start in the third quarter of 2008.
Borusan Mannesman Boru operates pipe welding facilities of 750,000 tonnes per year capacity in Turkey and exports about 35% of its output to the EU, the USA and Canada.
Socotherm operates pipe coating facilities in Italy, Spain, the USA, Brazil, Argentina, Venezuela, Qatar, China, Australia, Malaysia, Nigeria, Angola.
Establishment of the JV will allow BMB to extend their pipe business to Spain where a large scale expanding of gas services planned by Spanish government should spur high demand for large diameter pipes by mid 2008.
Rio asks for 30 year permit for mining nickel in Indonesia
Rio Tinto Group announced that a planned USD 2 billion nickel project in Indonesia may not proceed without the company getting an extended forestry permit.
Mr Tom Albanese CEO designate of Rio Tinto in an interview before meeting Mr Yusuf Kalla vice president of Indonesia said that Rio Tinto Group wants a 30 year forestry permit along with its mining permit. He said "Its a big thing thats why I am here. I dont think wed find it acceptable that every five years wed need to negotiate."
Indonesia now debating a mining bill, is trying to win USD 22 billion in annual investments in metal mining sector. But its ministry of forestry only gives five year renewable permits for mining companies seeking ore in forests.
USW to wait and see proposed buyout of IPSCO by SSAB
The announcement of USD 7.7 billion purchase of IPSCO Inc by Swedish Steelmaker SSAB Svenskt Stal has added to the United Steelworkers' growing concern about the rapid globalization of the steel industry although USW has been expecting an announcement about IPSCO ever since Mr David Sutherland president & CEO said that the company was open for offers.
Mr Steve Hunt Western Canada Director of USW said that "As in any take over situation we are concerned about maintaining employment levels by enhancing value-added operations in Canada. Our union is currently assessing SSAB to learn more about how it operates, about its labor relations record and its record on the environment."
Mr Mike Park USW staff representative for more than 800 members of local 5890 who work at IPSCO Regina's operations said that "Members are waiting to see how a buyout will shake out. We just don't know if this deal will go through or if there will be further bids on IPSCO from companies elsewhere Our members know that they work in very efficient and profitable operations and feel confident their plants will compete and remain open, no matter what happens."
Mr Keith Turcotte area supervisor for 240 members of USW Local 6673 at the IPSCO pipe mill in Calgary said "Our members put out the best products on the market. They have worked to make the plant one of the most efficient found anywhere, so there should be no surprises for them if any new buyer operates in a straight-up fashion."
Severstal joins Living Steel Program as full member
Living Steel announced that Russian SeverStal has joined the Living Steel program as a full member to achieve the common objective of providing innovative and efficient steel housing solutions for the global housing shortage. SeverStal is the 11th full member to join Living Steel, which also includes Arcelor Mittal, Baosteel, BlueScope Steel, Corus, Celsa, Erdemir, IMIDRO, POSCO, Ruuki and TATA Steel.
Mr Scott Chubbs program director of Living Steel said that "On behalf of all our members, I welcome SeverStal to Living Steel. The growth of cities has placed unprecedented pressure on society to rapidly address increasing urban population densities and the consequent impact on local environments, economies and quality of life. Living Steel strengthens its commitment for providing effective and responsible housing using steel now with the expertise and knowledge in construction which SeverStal brings to the program."
Mr Alexei Venediktov project manager of SeverStal said that "We believe that partnering with Living Steel members will be of great benefit in growing this important residential construction market. Through our combined efforts, we can more quickly realize the development of a supply chain that can support sustainable steel solutions for the global housing deficit."
Associate member includes St Gobain BPB and supporting members include Associao Portuguesa de Construo Metica e Mista, Asociaci para la Construcci de Estructuras Meticas, Asociaci para la Promoci Tnica del Acero, Bouwen mit Staal, Canadian Institute of Steel Construction, Centro Brasileiro da Construo em A, European Convention for Constructional Steelwork, Finnish Constructional Steelwork Association, Fondazione Promozione Acciaio, HERA, Institute for Steel Development and Growth, Instituto Latinoamericano del Fierro y el Acero, International Zinc Association, Korea Iron & Steel Association, Korean Society of Steel Construction, Singapore Structural Steel Society, South African Steel Institute, Staalinfocentrum - Centre Information Acier, Stahl-Informations-Zentrum, Steel Construction Institute, Steel Framing Alliance and Turk Yapisal Celik Dernegi.
Living Steel is a worldwide, collaborative program designed to stimulate innovative and responsible housing design and construction. Through its global partnerships, Living Steel combines existing best practice across disciplines to create the broadest possible base of knowledge and intellectual insight. It was launched in February 2005 by the International Iron and Steel Institute.
Arcelor Mittal to pay 5% royalty on iron ore to Senegal Report
Reuters reported that Arcelor Mittal will pay Senegal a 5% royalty for iron ore from a planned USD 2.2 billion mine project, well above the 3% stipulated in the West African country's mining code. The report cited a source as saying that "We are paying a higher royalty than in the mining code. We are paying 5 % of pit head price for concentrate against 3% in the mining code.
Arcelor Mittal has recently secured rights to big deposits in Senegal. The Senegalese deal gives it rights to iron ore reserves estimated at 750 million tonnes with projected output of up to 25 million tonnes a year.
Arcelor Mittal is setting up a Senegalese company and applying for a mining license so that it can start construction work on the mine infrastructure a railway to the Atlantic coast and a new port. The first shipment is due in 2011.
JFE to double HDG capacity at Guangzhou JV
JFE Steel Corporation has recently announced to double output capacity at its JV which is cooperated with Guangzhou Iron and Steel Enterprises Holdings Ltd in China. The project is expected to start in 2007 and be completed in 2010.
Production output of hot dip galvanized steel sheets primarily for the automobile industry will be raised to 800,000 tonnes per year from current 400,000 tonnes per year.
JFE said that it is expecting to continue their expansion in China in order to meet the demand for high quality automotive steel sheets.
Kuwait Oil orders premium casings from Tenaris
It is reported that Tenaris received a new order from the Kuwait Oil Company for 42,000 tons of casing with premium connections gas tight for sour service applications.
Mr Pablo Ibarguren sales manager at the Tenaris Dubai office said that We have been a major supplier to KOC over the past 10 years, mainly in the high end segment with our proprietary steels and premium connections. We believe the present contract strengthens our position in Kuwait and the Gulf, consolidating our presence as leaders in this market.
The new equipment will be used in KOC's exploration campaigns that will fulfill the company's requirements for more than two years. Given that the average depth of the wells in this area is 5,000 meters and the conditions of the formation are very demanding, these projects require high performance materials.
Steel Technologies' Q2 net remains flat YoY
Louisville based Metals processor Steel Technologies Inc which is being acquired by Mitsui & Co Ltd of Japan announced that it posted slightly lower quarterly earnings due to merger related expenses and the impact of discontinued operations.
Steel Technologies in a statement said that it posted Q2 net income of USD 2.8 million as compared with USD 2.9 million YoY. The year ago figure includes a gain of USD 645,000 from discontinued operations. Revenue for the second quarter ended March 31st 2007 rose to USD 251.5 million from USD 238.3 million. Steel Technologies in a news release, said the increases in sales and net income were driven by higher selling prices and volumes.
For the first six months of fiscal 2007, net income fell to USD 3.7 million, from USD 6.2 million, a year earlier. The year ago figure includes a gain of USD 1.1 million from discontinued operations.
Mr Bradford Ray CEO of Steel Technologies in a statement said that he sees continued volume and income improvements during the third quarter. He added that Steel Technologies remains on track to complete the merger by the end of the third fiscal quarter.
Louisville based Steel Technologies processes flat rolled steel for automotive, appliance, agriculture, railcar, construction and other industries.
Philippine government to mediate Jinchuan & Philinco talks for Nonoc nickel investments
Metals Insider has reported that Chinese nickel producer Jinchuan has improved its original USD 1 billion offer and asked the government to help it in negotiations to buy the mothballed Nonoc nickel mine and refinery in the Philippines.
Mr Peter Favila secretary of trade and industry of Philippines government said that Philippines government would try and help bridge the gap between Jinchuan and Nonoc owner Philnico after talks broke down some time back over the question of revenue split. He said Jinchuan is going back to the negotiating table with government bridging the negotiations between the Chinese and Philnico. That is why they are communicating through us.
Nonoc has been closed since the early 1980s but has the capacity to produce 41,000 tonne per year of nickel.
CMCC & Ghaem Reza to construct Arfa Steel in Iran
It is reported that Chinese Metallurgical Construction Company in partnership with local Ghaem Reza Industries Company has been selected to carry out steel factory construction of Arfa Steel at Ardakan in Yazd province.
Construction of steel factory comprises of direct reduction facilities and a melt shop with capacity of 1 million tonnes per year. The budget of the project is estimated at USD 315 million.
As per report the main consultant for the project is Iranian Foolad Technic International Engineering Company.
Timkens Q1 net dips by 35% YoY
Bearings and specialty steel maker Timken Co announced that its Q1 earnings fell by 35% primarily because of increased restructuring costs and the lower demand in the North American automotive industry.
Timken reported a profit of USD 42.6 million, for the quarter ended March 31st 2007 as compared with earnings of USD 65.9 million a year ago. Its sales rose slightly to USD 1.28 billion from USD 1.25 billion. Excluding special items like restructuring and rationalization charges of USD 27 million.
Timken's industrial group reported record first quarter sales of USD 544.4 million, up by 8% from USD 503.9 million YoY. Favorable pricing and higher volume, particularly in aerospace and heavy industry, were responsible for the increase with earnings up by 7% to USD 49.2 million.
Steel group sales, driven by demand in the energy and service center sectors, rose by 4% to USD 390.3 million. But losses at the automotive group widened to USD 7.2 million from USD 3.1 million YoY, the company said, citing the sale of its steering business and lower demand in North America.
Mr James W Griffith CEO of Timken said that "Our first quarter results rebounded following the challenges we encountered during the second half of 2006. We are confident that our strategic initiatives, including automotive restructuring and targeted industrial capacity additions, will combine with continued strong steel performance to deliver improved results in 2007."
Timken said earlier that it is closing its Sao Paulo, Brazil, facility as part of an effort to cut back on manufacturing in its automotive group. Since 2005, the company has reduced its automotive group employment by more than 2,500 jobs, including those in the sale of the global steering business.
European Nickels Caldag nickel project in Turkey held up due to forest clearance
It is reported that European Nickels Caldag nickel project in Turkey is held up due to delay in receiving the forestry permit to allow it to clear trees covering the area for its leach pads.
Mr David Whitehead chairman of European Nickel while addressing the companys annual general meeting said that "The infrastructure at the mine has now been largely completed with long lead items starting to arrive. However, there is a limit to how much more we can do in the absence of the Forestry Permit and we have stopped placing further orders for equipment until it has been granted.
Mining at Caldag has already started and the company continues to deliver ore to Greek ferronickel producer Larco with 130,000 tonnes shipped to date. However, this is an interim phase prior to the construction and operation of a heap leach plant to produce nickel in hydroxide.
GVM to Look at Mooiplaats Coal Projects Feasibility
Business Day reported that GVM Metals plans to start a feasibility study on its latest acquisition the Mooiplaats coal project during the current quarter.
GVM said that Holfontein drilling was continuing to increase the definition of the coal resources and a feasibility study should be completed by the end of the September quarter.
GVM Metal is finalizing the purchase of Kelso Mining whose main asset is the right to take 70% of the Mooiplaats coal project and planned to bring into production the 1.2 million tonne a year Holfontein project and the 4.5 million tonne a year Mooiplaats project within the next two years. Mooiplaats is within 2 km of the Camden power station and also close to the Richards Bay coal export line.
GVM said Eskom was consuming more coal than it had originally planned and needed substantial new coal sources.
Fitch and Moody assign stable outlook for Raspadskaya
It is reported that Fitch Ratings has assigned Russia's OJSC Raspadskaya a 'B+' issuer default rating and a short term 'B' rating with a stable outlook and Moody's Investors Service has assigned a 'Ba3' foreign and domestic currency corporate family rating with a stable outlook.
Fitch said the ratings reflect Raspadskaya's position as the second largest coking coal producer in Russia its strong financial profile and low cost advantages. It also said the ratings also factor in Raspadskaya's modest diversification across products geography of sales and customers. Fitch also noted that OJSC Raspadskaya scale of operations that could restrain operational and financial flexibility, particularly in an industry downturn.
Moody said that the ratings take into account the company's large reserves with significant proportion of scarce hard coking coal, its well invested asset base with over 50% expansion CAPEX already completed, underpinning the good health and safety track record apart from other factors.
OJSC Raspadskaya is Russia's second largest coking coal producer located in the Kuzbass region. Raspadskaya is indirectly 40% owned by management and 40% by steel company Evraz Group SA with the rest being free float.
Datong Coal eyes HK IPO
The Shanxi based miner Datong Coal Industry plans to list shares in Hong Kong to raise HKD 5.6 billion for the expansion of its reserves and production capacity.
Datong Coal told the South China Morning Post that it would sell 300 million H shares, 26.39% of its enlarged share capital, to overseas institutional and Hong Kong retail investors. The strategic investors would be given priority in the institutional portion. It might sell 15% more shares if demand warranted it said without giving a timetable.
Datong Coal said if the listing on the Hong Kong Stock Exchange be successful, it will join three other Mainland coal miners China Shenhua Energy, China Coal Energy and Yanzhou Coal Mining in the Hong Kong stock market.
Datong had mandated HSBC and other investment banks to handle its Hong Kong listing.
Zimbabwe Bank to invests ZWD 10 billion in Beitbridge coal mine
The Reserve Bank of Zimbabwe through its investment vehicle Fintrust has poured nearly ZWD 10 billion towards the development of a new coal mine in Beitbridge.
Registered as Tuli Coal Mine (Private) Limited, the mine will produce coking coal a by product of coal used principally for metallurgical purposes and in steel production and will export 80% of its output while the other 20% would be for domestic consumption.
Mr Mugari Nyachiya ED of Tuli Coal Mine said that the mine is looking at increasing production to 250 000 tonnes per month in the short to medium term. Mr Nyachiya said that the moment we are hiring machines and equipment that we are using but we will be gradually buying equipment and eventually increase production to around 250,000 tonnes per month.
Its shareholders include Firmol (Private) Limited and the Kutamba.
Sally Malay lowers nickel production guidance
It is reported that Australian nickel junior Sally Malay Mining has lowered its production guidance at the Sally Malay mine in Western Australia.
Production in the current financial year ending in June 2007 is now seen at around 8,000 tonne of contained nickel in concentrates compared with a previous target of 8,600 tonne.
The slight downgrade was made after January to March quarter production fell to 1,810 tonne of contained nickel from 2,330 tonne in the previous quarter.
Production in 2006 at Sally Malay was 7,369 tonne.
Construction starts on tungsten and molybdenum facility at Luoyang
INTERFAX-CHINA recently reported that the construction has begun on China's largest tungsten and molybdenum deep processing project in the city of Luoyang in Hennan Province of China. The three companies involved in the project signed the agreement for the JV on April 16th with construction beginning on the project almost immediately. As part of the agreement Luoyang Mudu Tungsten and Molybdenum Hi-Tech Co Ltd. will be established in Luanchuan where the facility is located to oversee the project. Construction will take between one or two years to complete.
Mr Xie an official from Luoyang Mudu Mining and Smelting Co Ltd told Interfax that total investment in the new tungsten and molybdenum line will amount to CNY 300 million (USD 3.89 million) which is shared through a JV between Luoyang Mudu, Beijing Tianlong Tungsten & Molybdenum Co Ltd and Luanchuan Zhonghe Burden Co Ltd. Mr Xie added that Luoyang Mudu holds a 52 % stake in the JV with Beijing Tianlong and Luanchaun Zhonge each holding a 24% stake.
Mr Xie added that We plan to bring each of the project's production lines online as they are finished with the scheelite concentrate recovery line our first line, scheduled to begin operations by the end of 2007. The facility will produce tungsten products through recycling tailing ores while molybdenum products will be produced from locally purchased molybdenum ore."
Upon completion, the project's tungsten and molybdenum line will be able to produce 5,000 tons of ammonium paratungstate a year as well as 2,000 tonnes of tungsten powder, 6,000 tons of molybdenum oxide, 5,000 tonnes of ferromolybdenum, 5,000 tonnes of ammonium tungstate and 1,500 tones of molybdenum powder.
