Essar to fast track Algomas expansion plans

Canadian media reported that a small Algoma delegation is bound for Mumbai this week to begin preliminary discussions on how best to integrate Algoma with Essar Steel. As well, previously announced projects and strategies by Algoma are being accelerated. The vision is to increase annual shipments from the current 2.4 million ton level to 4 million tons, possibly 5 million tons further down the road.

Mr Denis Turcotte president & CEO of Algoma in a teleconference with local media last week to discuss recent Q1 performance said "Essar is pretty well aligned with our five year capital plan for growing the business, a significant investment into expansion and they want us to implement it quicker than initially proposed. We had advised the board of directors that we would complete expansion over five to seven years but Essar would like it completed in three to five years. Ownership has the last say on how and when to move forward."

Mr Turcotte added that "Essar has massive corporate resources that we could tap into if they want to accelerate the process. The real work will be integration so that both sides are getting the full benefit of the relationship. We need to develop an edge on the competition and we feel that opportunity's there through Essar's massive resources."

Algomas plan called for capital investment of more than USD 500 million to significantly increase production, into product diversification and infrastructure such as mill upgrades. As per report, an Essar information technology team is expected to visit Algoma in the near future to assist in remedying problems plaguing the Algomas investment into business system renewal.

Essar Global Ltd's CAD 1.85 billion cash offer for the Algoma is yet to get two third shareholder approvals at next month's annual general meeting.

Independent body calls for a halting work on POSCO project

Hindu reported that an independent fact finding team has called for a White Paper on the POSCOs proposed steel plant project in Jagatsinghpur district of Orissa and demanded that till such time Orissa should stop the implementation of the project. The White Paper is being sought in the interest of making the information and the processes related to the project available to all concerned in the wake of the protests.

The team said the project should not be allowed to come up against the wishes of those affected by it and as a first step towards building such an atmosphere, police and para military forces deployed in the surrounding areas should be withdrawn immediately.

The team described POSCO project as a case of clear misuse of the Land Acquisition Act of 1984 and strongly recommended that the government should not use the act to acquire land for companies or to coerce people to give up their land. Quoting the 73rd and 74th Constitutional Amendment, the report suggests that the rights given to the communities under these amendments to plan the use of their natural resources, which include riparian rights and rights to common property resources must be protected.

The report warns that in the prevailing situation there is every possibility of a confrontation breaking out; such a confrontation could lead to violence and take the shape of civil war. It added that every effort should be made by all concerned to prevent such an eventuality in the larger interest.

The team, comprising of independent observers including Mr Sumit Chakravarty, Ms Sridevi Pannikkar, Mr MV Bijulal and Manshi Asher visited the site in April to get an insight into the concerns raised by the affected communities.

TATA Steel inaugurates iron ore beneficiation facility at Noamundi

PTI reported that TATA Steel last week inaugurated an automated iron ore fine jigging plant at its Noamundi mines in West Singhbhum district of Jharkhand.

Mr B Muthuraman MD of TATA Steel inaugurated the jigging and hydro cyclone plant of capacity about 300 tonnes per hour or 1.6 million tonnes per annum throughputs.

The jigging plant has been installed at a cost of about INR 25 crores and within two years. The hydro cyclone plant installed at a cost of about INR 7 crores will help in recovering iron values from the slime being discharged from washing plant and reduce alumina level.

The facilities will help in effective use of iron ore fines, reducing coke consumption and increasing productivity of blast furnaces.

Mixed reaction from Goas iron ore miners on export tax policy change

UNI reported that a section of iron ore miners from Goa are not happy with recent concession granted by Indian government on export tax on iron ore.

Mr Nitin Kunkuleinkar president of Goa Chamber of Commerce and Industry told UNI that he was not happy with Mr P Chidambaram union finance minister's announcement in parliament about reducing the export duty on iron ore by mere INR 50 per tonne.

Mr Kunkuleinkar told UNI that ''We are not too happy and he should have reduced it further to INR 100 from INR 300 announced initially. The industry expected the levy of duty grade wise.

However, Mr S Sridhar executive director of Goa Mineral Ore Exporters Association welcomed the announcement saying it would benefit the industry to some extent. He said that almost 50% of the 26 million tonnes of iron ore is exported every year from Goa is of low grade with below 62% Fe content.

Goa is the largest exporter of iron ore, particularly low grade to traditional countries besides China.

JSL orders Sherman for a 4HI CR mill

It is reported that Jindal Stainless Ltd has contracted UAE based Sherman Steel Technologies FZE to design, build and supply a new 620 mm wide single stand 4 HI cold reversing mill for their plant in Hisar in Haryana in India.

The mill will have a speed of 400 meters per minute and will roll down up to a thickness of 0.10mm.

Sherman Steel Technologies FZE is an affiliate of Sherman International Corporation, which supplies new and second hand steel mill equipment.

INSDAG promoting use of steel in rural areas

BL last week reported that the Institute for Steel Development & Growth has taken several initiatives for promoting usage of steel in rural India. National Steel Policy had outlined that per capita steel consumption in rural India should go up from 2 kilogram at present to 4 kilogram by 2019-20.

Dr RKP Singh director general of INSDAG told BL that INSDAG has taken several initiatives including the introduction of steel bullock carts in villages and facilitating increased usage of steel in rural housing and rural construction. Dr Singh added that "While we feel this target could be surpassed, for it to happen, it would be imperative to focus on increased steel consumption in rural areas. Increased steel consumption in rural areas will also improve the quality of life of people living there."

Dr Singh said that "We want to encourage innovative ways of steel consumption in rural areas. Steel companies have been persuaded to sponsor steel bullock carts. We have also convinced some banks to provide loans for the purpose. Non government organizations and the Khadi & Village Industries Corporation have been involved in the initiative."

He added that 250 farmers from Aska in Orissa have placed orders for steel bullock carts for transporting sugarcane from the fields to the sugar mills in the region. The cost of these steel bullock carts have been pegged in the INR 10,000 to INR 15,000 range and they are stated to be more durable compared with bullock carts made of bamboo or wood.

INSDAG, in association with Central Mechanical Engineering Research Institute has developed steel bullock cart models whose minimum durability has been pegged at around 20 years.

Kolkata Port aiming for 60 million tonnes of traffic in 2007-08

The Kolkata Port Trust is aiming to handle an estimated 60 million tonnes of traffic in 2007-08 as compared to 55.05 million tonnes in 2006-07. As per port estimates, the share of Haldia dock in the projected traffic would be about 46 million tonnes as compared to 42.45 million tonnes in 2006-07. Kolkata Port is also aiming at revenues of INR 1,400 crore in 2007-08 as against INR 1,249.64 crore in 2006-07.

Dr AK Chanda chairman of Kolkata Port Trust told media that To enable higher traffic handling, the port needs to set up cargo handling facilities in deep drafted areas southward to meet the demands of changing shipping trends.

Dr Chanda said that With the changing scenario in the maritime technology, both in terms of size and structural pattern, the expansion of the port will depend on the depth of draft. All along the 232 kilometer long navigational channel of the port the draft varies from 7 meters at Kolkata Dock System to an average of 8.5 meters at Haldia Docks. The draft size increases significantly with southward movement to Diamond Harbor, Saugor and Sandheads.

During the 11th five year plan period, KPT has undertaken an investment plan of INR 968.67 crore for setting up infrastructure and taking up river regulatory works. The breakup of investment is INR 268.69 crore for Kolkata Dock System, INR 278.93 crore for the Haldia Dock and INR 421.05 crore the River Regulatory Scheme. An estimated INR 551.04 crore funding would be by way of budgetary support and grant in aid and the rest through internal resources.

KPT has planned to construct three multipurpose cargo handling jetties at Diamond Harbor at an estimated cost of INR 360 crore on public private partnership basis. KPT has also formed a working group with Orissa government to undertake work of a dry bulk cargo transloading facility at Konika Sand. A similar facility is planned at Sandheads. Apart from this, the port is procuring cargo and container handling equipment. It is also constructing 2 berths and 2 river jetties in the Haldia Dock Complex.

Man Industries to raise USD50 million through FCCB issue

Man Industries India Ltd announced last week that it has successfully placed an offering of USD 50 million zero coupon foreign currency convertible bonds. Man Industries intends to use the net proceeds raised for expansion of manufacturing facilities in India, international expansion and such other purposes as may be permitted by Indian law and RBI Regulation.

The release said that the bonds have a tenor of five years and one day and are convertible into equity shares at a price of INR 287 per share at a premium of 26.2% over the VWAP of the shares on the BSE on May 3rd 2007. These Bonds are expected to be listed on the Singapore Stock Exchange. The closing is likely to take place on May 22nd 2007 subject to requisite approvals having being obtained.

Mr RC Mansukhani c of Man Industries said that "The successful launch of the FCCB is reflection of international investors confidence in the growth prospects and management of the Company. The funds raised by the FCCB will provide an impetus for organic and inorganic opportunities available to the Company in Pipe Industry globally."

BNP Paribas acted as the sole Lead Manager and Bookrunner to the transaction.

CIL not responsible for power generation losses in 2006-07

Dr Dasari Narayana Rao minister of state for coal informed the Rajya Sabha in a written reply that coal companies have sufficient coal stock to meet the assessed demand of power plants.

However, he added, off take by power utilities from Coal India Limited sources during 2006-07 was less than the Annual Action Plan target by about 4% on account of non materialization of demand, infrastructural bottlenecks, unloading constraints, transportation constraints and reluctance in building up normative level stocks by power plants at their end.

He also clarified that no generation loss has been reported by any power station on account of coal shortage during 2006-07. Dispatch of coal to power utilities from Coal India Limited sources during the last 3 years are given as under

In million tonnes

Dr Rao also informed the House that power utilities have imported only about 10 million tonnes of coal during 2006-07 as against the target of 20 million tones.

All PPP projects to follow 2 stage bidding process

It is reported that the committee on infrastructure under the prime minister has approved a common set of guidelines framed by the finance ministry in consultation with the Planning Commission for short listing bidders for public private partnership projects.

According to the report all public private partnership projects in the infrastructure sector including roads, railways, airports and ports will compulsorily have to follow a two stage bidding process for short listing bidders at the pre qualification stage.

The guidelines aim at eliminating the element of subjectivity in analyzing technical proposals at the pre qualification stage and essentially, bidders will be short listed on the basis of their capacity to undertake the project, past experience and financial capability. The guidelines also call for restricting the number of short listed bidders in the pre qualification stage to 5 especially in the case of large projects.

Most of the large projects that are undertaken on a PPP basis follow a two stage bidding process involving the technical and financial bid but several projects in the roads sector skip the two stage process.

Corus worker union leaders meet TATA Worker Union

Ranchi Express reported that Corus labor union representatives from Netherlands, Germany and the United Kingdom, who are on a visit here, hinted during their meeting TATA Worker's Union that steel industry in developed countries was facing stiff competition from the developing countries.

Mr Ian Crichton member of European Worker's Council told media that after TATAs acquisition of Corus, it will be interesting to watch how it deals with variant factors of two steel industries. He said that Now, they will be facing the same trying situations experienced by the same trying situations experienced by the companies there.

Navratna status for SCI under consideration

Mr TR Baalu minister of shipping, road transport and highways in a written reply in the Rajya Sabha informed that a request is pending with Government to grant the Navratna status to Shipping Corporation of India.

Mr Ballu said that many areas of deficiency have been noticed in corporate governance of SCI which need to be removed in the interest of efficiency and transparency. He added that SCI is taking corrective measures to ensure that its internal governance system achieves a level of efficiency and transparency that a company should desirably achieve before Navratna status is bestowed on it and the progress towards these reforms is being monitored regularly.

CVRD inks freight contracts for shipping iron ore to China

Companhia do Vale do Rio Doce announced that it had signed a 25 year freight contract with Bergensen Worldwide Bulk involving the construction of the four largest bulk cargo ships ever made.

The contract involves the construction of four very large ore carriers, each with a capacity of 388,000DWT, which will be the largest ore carriers in the world. The first of these ships should go into operation in the first half of 2011, contributing to the reduction of cost through economies of scale and minimizing CNF price volatility of its iron ore to China. In 1986 CVRD, with BW Bulk, had introduced the Berge Stahl at 364,000DWT, which is currently the largest ore carrier in the world.

CVRD has also entered into a separate contract wherein BW Bulk will convert a very large crude carrier into a very large ore carrier. The converted VLOC will commence service in 2008 on the Brazil to China shuttle service.

CVRD also said that it had signed a second contract lasting 20 years, with Nippon Yusen Kaisha of Japan involving the construction of a ship with a 300,000DWT the delivery of which is scheduled for 2011.

CVRDs initiatives are focused on the development of a dedicated shuttle service to carry iron ore from Brazil to China.

Mr Chavez calls Mr Rocca to curtail Sidors exports

Venezuelan president has slammed Sidor for selling bulk of its output overseas, forcing local producers to import and has threatened to expropriate company if it resists orders saying that Venezuelan industry should be given priority. Earlier last week, Mr Chavez warned he could nationalize Sidor and private banks if they failed to change what he called unscrupulous business practices that harm local industries.

Mr Chavez at a news conference on Saturday said We are going to pass a law, Rocca. We are going to force you to supply, first and foremost, the Venezuelan domestic market before you take the steel to other countries. If you do not agree, give it to me. I will grab your company. Give it to me and I will pay you what it is worth. I would not rob you. Mr Chavez said he has summoned Mr Paolo Rocca chairman of Ternium from Buenos Aires for talks.

Ternium Sidor produces steel necessary for tube manufacturing and ships it to a group of companies. This action seems to be prompted by reactivation of the Invetubos located in Carabobo state, which manufactures tubes for the oil industry. The company has been closed for 11 years but a group of traders recently purchased 55% of the plant and began production after investing USD 9.7 million. Employees own 45% of the company. State oil company PDVSA purchases Invetubos' output.

Sidors parent company, Luxembourg based Ternium SA, is controlled by conglomerate Techint Group of Argentina. Sidor was privatized in 1997 and is Venezuela's largest steelmaker with average liquid steel production of 4.2 million tonnes per year. The Ternium steel group holds a 59.75% share in Sidor, the Venezuelan state controls 20.36% through state heavy industry holding company CVG, and employees own the remaining 19.91%.

Terniums Q1 net up by 29.4% YoY

Ternium SA last week announced its results for the first quarter ended March 31st 2007 in accordance with International Financial Reporting Standards.

Its net sales increased 17% during the first quarter 2007 compared to net sales in the first quarter 2006 as a result of an 11% increase in shipments and 6% increase in revenue per ton. During the first quarter 2007, operating income was 6% higher than it was in the first quarter 2006. This was due mainly to higher shipments and steel prices, partially offset by higher raw material and labor costs.

Shipment in million tonnes
Others in million USD

Net sales for the first quarter 2007 increased 17% to USD1.8 billion compared with the same period in 2006 mainly due to higher demand and prices in Terniums core markets.

In USD million
Other products include iron ore and pig iron.

Shipments of flat and long products reached 2.5 million tons during the first quarter 2007, an increase of 11% compared to shipment levels in the first quarter 2006, as a result of higher demand in most of Terniums markets. Revenue per ton shipped increased 6% to USD 701 in the first quarter 2007 versus the same quarter in 2006.

In 10,000 tonnes

The main investments made during the first quarter 2007 were: the upgrading of the hot strip mill in Mexico; the relining of one of the blast furnaces and the construction of new coking facilities in Argentina; and the construction of a new ladle furnace in Venezuela.

Ternium is one of the leading steel companies in the Americas, producing a wide range of flat and long steel products. With operations in Mexico, Argentina and Venezuela and 18,000 employees, Ternium had net sales of USD 6.6 billion and a production of 9 million tons of finished steel products in 2006.

CVRD forecasts low nickel inventories in 2007

CVRD, despite slowing stainless steel production growth and increased production of nickel pig iron in China, said that We estimate that the growth in nickel supply will be sufficient only to meet the increase in consumption, with nothing available for the necessary replacement of inventories.

CVRD added that Stainless steel production growth is expected to slow to 7% in 2007 from 16% 2006 but demand for nickel for other applications coming from the oil and gas industries, aerospace and batteries holds firm, and no sudden changes are expected.

Price of HRC in US drops by USD 10 per short tonne

Platts reported that the psychology of the HR coil spot market may be turning in favor of steel buyers as the price of HRC was off at least USD 10 per short ton to a range of USD 550 per short ton to USD 560 per short ton or a midpoint of USD 555 per short ton for 1,000 short ton to 3,000 short ton orders.

The report adds that the previous high end of the range of USD 570 per short ton is now being quoted for smaller orders of about 500 short tons. There were even some one off, bargain deals reported in the USD 520 per short ton to USD 540 per short ton range but these were for big tonnage orders in excess of 10,000 short tons in some cases.

While, scrap price in the US has declined for the second successive month this week, dropping by more than USD 60 per long ton on the heels of a scrap price decline last month of at least USD 40 per long ton. Another key factor, demand from end users in the US is frail. According to another source, the soft orders reflect the lack of strength from key demand drivers. US GDP growth is so so, the auto market is lousy and housing's just plain bad and almost all the major sectors are down.

Mr Yanpei's address on obsolete steel capacity elimination in China

Mr Zeng Yanpei deputy premier of China made a speech about stepping up elimination of obsolete steel capacities on a lately held conference. Given below are the main targets for the obsolete steel capacity elimination campaign and measures to take to reach the goal.

China aims to force out iron smelting and steel making capacities of 100 million tonnes and 55 million tonnes respectively by the end of 2010, with 30 million tonnes and 35 million tonnes to be closed down this year. By then, comprehensive energy consumption for per ton steel produced should be reduced: standard coal from 0.76 kg to 0.73 kg; fresh water consumed down to 6 ton from 12 ton; sulfur dioxide emission down to 2.64 kg. China also purposed to form two to three 30 million tonnes level and a number of 10 million tonnes level world competitive large steel groups, with the top ten steel makers to account 50% or up of the nationwide steel output.

China will then have these tasks to do.

1. It will force out outdated steel capacity in light of the industry policy, including quicken phasing out of 300 cubic meter and smaller blast furnaces, 20 ton or lighter converters and electric furnaces as well as outdated rolling mills. All the facilities included for elimination must not be transferred or sold for re building in another place. The sector will consume 17 million tonnes less standard coal, 30 million tonnes less water, and discharge 90,000 tonnes less sulfur dioxide once outdated facilities under this year's target are phased out.

2. It will tighten technical and economic requirements for setting up new projects, and raise the threshold for industry admittance. The existing and under construction capacities need to get internationally competitive while small blast furnace of less than 1000 cubic meter and converters of 120 tonnes or below could not be approved. In the areas short of water, iron ore resource and inconvenient for transport, construction projects should be prudently decided based on specific market capability.

3. It will better utilize resource and protect environment and try to realize zero emission of smoke gas, dust or slag and 95% water cyclic utilization rate by 2010. All steel makers are required to raise utilization of waste gas, water and residue by making use of reclaiming systems and pollutant treatment establishment.

4. It will work to build the first rate steel makers in the world. In light of the medium/long term development blueprint and industry policy, steel sector should improve technical level for structure upgrade and investment to catch up with world plane, in the direction of large-scale, high-efficiency, continuous, automatic, environment-friendly, intensive and cyclic growth. In principle, sheet, plate & strip projects are required to equip with 2000 cubic meter or larger blast furnaces.

5. It will be supportive to cross region merger and acquisition of the steel makers, regardless of their ownership, encourage big steel makers' growing to groups and create better environment for shaping of world competitive large mills, so as to increase the sector's concentration rate.

In order to realize all these goals, following measures should be carried out at present.

1. Taxation and pricing tools to regulate. Rebate cut moves introduced in last year and this April 15 should be carried out earnestly; meanwhile, the nation is mulling to hike provisional export tax on billet & slab, coke and some low end steel products to further tame production and export of high energy consuming and high pollutant products. For higher end steel products and some specialty types, the rebate could be kept at a suitable rate. Differential power rates will be imposed to clear up obsolete capacities.

2. Tighten market admittance management. In line with national development blueprint and industry policy, relevant depts. will hold the threshold for existing and under construction steel projects by resorting to land use and environment protection rules. If not approved, the projects should not be granted of production license, taxation registration, no credit from financial institutes, no design paper from the designing units, or equipments from the manufactures.

3. Insistently take elimination of obsolete capacity as primarily qualification. Those who have taken initiative in closure of inefficient capacity would be granted preferential treatment when seeking for approval of new projects; while those who fail to meet required commission will not allow for new items. Meanwhile, the leading mills are required to make promise to scrap backward capacity equivalent to the Greenfield project they are applying for; and they need to gradually condense the inefficient capacity once the new projects are approved, till entire shut down.

4. Financially support the campaign. The local governments may be compensated economically when some small mills, which were its taxpayers, are forced out; for the mills approved by local governments themselves, they also need financial remedy when being shut down. Earnings gained from differential power rates should come to the local governments to back up capacity election.

5. Strengthen supervision. The set rules, measures and policies about stepping up obsolete capacity elimination should be carried out in a planned and systematic way; strict and timely measures should follow for the missed closures along with investigation into responsibility. The obsolete capacities should be published in batches, to receive public supervision over the campaign.

(Sourced from MySteel.net)

Outotec Oyjs interim report for January to March 2007 quarter

Good profit performance continued and order backlog remained strong in the first quarter of 2007. The market conditions for mining and metals industries continued to be favorable. Outotec achieved 47% sales growth and 234% operating profit growth on the corresponding period in 2006.

Highlights of the reporting period (Q1/2007):
1. Sales for Q1 of 2007 grew by 47% from the comparison period in 2006 and amounted to EUR 211.7 million as compared to EUR 144.2 million in Q1 of 2006.
2. Operating profit improved by 234% to EUR 13.6 million as compared to EUR 4.1 million in Q1 of 2006. Profit before taxes amounted to EUR 15.3 million as compared to EUR 5.3 million in Q1 of 2006.
3. Order intake was EUR 168.1 million as compared to EUR 185.6 million in Q1 of 2006.
4. Order backlog was EUR 836.5 million as compared to EUR 633.5 million in Q1 of 2006..

Summary of key figures

In EUR million

Mr Tapani Jvinen CEO of Outotec said that "Our customers' investment activity and confidence in our technologies and products strengthened our performance during the first quarter. The new emerging markets are offering more and more business opportunities for Outotec. Our customers in traditional mining countries are also continuing their investments, because the continued high metals consumption forecasts keep the metals prices high. As the raw material prices have increased and delivery times across the industry are getting longer, we have seen that the decision making process takes time in large projects. This means that some large projects that we expected to become effective already in the first quarter are anticipated in the second quarter of 2007. Our operating profit during the first quarter of 2007 improved clearly from the corresponding period in 2006. The balance sheet remained strong, and our earnings per share more than doubled from the first quarter of 2006.

Mr Jvinen added that When changing the company name to Outotec we turned a new leaf in our decades long history as a provider of leading-edge technologies for the mining and metals industries. Outotec will be uniting all our global businesses and represent technological leadership, innovativeness, reliability, and good collaboration spirit with customers the same brand values that Outokumpu Technology had."

ChTPZs Pervouralsk to add a finishing center

ChTPZ Groups OAO Pervouralsky Novotrubny Works has placed an order with SMS Meer for the supply of a complete finishing center for the existing pipe plant. The finishing center is designed for an annual capacity of 75,000 tonnes to 90,000 tonnes and consists of tubing & casing line, testing line, upsetting line and heat treatment unit. Tubes in the size range from 60.3mm to 177.8mm can be finished on the tubing & casing line. Commissioning of the whole finishing center is scheduled for the end of 2008.

The line essentially comprises four pipe threading machines, a two head hydrostatic pipe tester with a maximum pressure of 150 MPa, two drifter units for checking the pipe inside diameter, the automatic measuring system for weighing, length measurement, testing and marking and a magnetic bundler for stacking pipes in hexagonal bundles.

On the upsetting line, tubings and drill pipes in the size range from 60.3mm to 127 mm are upset at the pipe ends. The scope of supply includes an upsetting press with an upsetting force of 2,500 kN with upline induction heater and the necessary inspection and testing stations.

The testing line is used to inspect the quality of the heat treated and non-heat treated pipes. Longitudinal and transverse flaw tests are performed in accordance with the international standards.

Upset and plain-end pipes in the size range from 60.3mm to 219.1 mm are heat treated on the heat treatment line. The scope of supply includes a hardening furnace and an annealing furnace supplied by SMS Meer of Italy, the quenching facilities with the associated water management system, a hot straightened with the necessary contraflow cooling beds and the interconnecting transport facilities.

Aricoms study suggests 10 million tonnes from Garinskoye iron ore project

Aricom PLC announced that it completed scoping study of its 60% owned Garinskoye project, which suggest that the project could support iron ore mining at 10 million tonnes per year for producing up to 6 million tonnes per year of concentrate. Aricom also said it has already completed a quarter of the required confirmation drilling with historic reserve and resource estimates supporting a mine life well in excess of 25 years and will now work with OJSC Giproruda on the Garinskoye feasibility study expected by the fourth quarter.

Aricom said on this basis it is estimated that the first stage of concentrate sales could commence in 2009 and full production capacity could be reached in 2011.

ITAR TASS reported that an agreement between the Amur Region and Aricom was signed on last weekend for implementing Garinskoye iron ore mining project. The agreement envisages investments of more than RUB 31.9 billion in construction of a mining complex at the Garinskoye iron ore field to produce 10.5 million tonnes of ore a year. It is planned to be put into operation in January 2013.

Aricom won the right to work on the field, the largest in the east of the country in December 2006 in an auction, in which 7 contenders participated. There are almost 400 million tonnes of prospected ore reserves and there may be even 500 million tonnes to 600 million tonnes. About half of the deposits contain up to 50% of Fe and the Fe content is rather high in the rest part.

Eramets Q1 nickle production down by 14.3% YoY

Paris based Eramet SA, the operator of the worlds largest ferronickel plant, announced that its Q1 sales rose by 13% YoY aided by higher prices for nickel and manganese. Its revenue increased to EUR 811 million from EUR 717 million in 2006.

Eramets nickel sales went up by 25% YoY to EUR 281 million although its output went down by 14.3% YoY to 14,605 tonnes and nickel deliveries were down by 22% YoY at 12,999 tonnes. The increased prices of nickel offset lower production. The strike at the end of 2006 in New Caledonia resulted in a reduction in the grade of ore used in metallurgical nickel output at Doniambo.

Eramets manganese sales also increased by 1.5% YoY to EUR 269 million and its alloys units sales increased by 14% YoY to EUR 262 million.

Eramet said that its first half operating income will be higher than a year earlier if the price of nickel remains at its current level.

Eramet said that the outlook for the global nickel market remains favorable and its nickel output is due to rise in the second quarter with 2007 production due to reach between 63,000 tonnes to 64,000 tonnes as compared to 62,383 tonnes in 2006.

Malaysian Smelting Corp forecast lower tin output in 2007 due to limited feed

An official of Malaysia Smelting Corp told Platts that Malaysia Smelting Corp expects to see its 2007 tin output lower than that produced in 2006, despite the grant of a tin export license for its Indonesia subsidiary PT Koba Tin. The official attributed the lower expected output to lower production at its Butterworth plant in Malaysia and its Indonesian subsidiary PT Koba Tin. However, he declined to give details on how much lower the 2007 output would be or what the 2006 production was.

The official said that Its 75% subsidiary, PT Koba Tin has been granted an export license by the Ministry of Trade in Jakarta effective from April 18th 2007. With the license, we can deliver and ship production of tin metal. However, there is documentation to follow up with and it will take some time. We don't expect to ship immediately."

He added that PT Koba has two sources of tin concentrate; one is through its own dredging and gravel pump operations and the other is from small scale Indonesian miners. We still can't get supply of tin concentrate from these small scale miners and thus we can't be producing our desired maximum output of 2,000 tonnes per month tin metal. Its own dredging and pump operations could only produce an average of 500 to 600 tonnes per month of tin metal. An investigation has been carried out on PT Koba Tin as a result of a report alleging PT Koba Tin's involvement in the collection of tin ore from small scale miners operating outside its contract of work area.

PT Koba has a maximum output capacity of 20,000 million tonnes per year of tin metal and has been producing at this capacity.

The official said its Butterworth plant in Malaysia was expected to see lower output in 2007 as its feed stock from Indonesia had been affected since the ban on tin export by the Indonesian government in late 2006. The company buys from some of the affected private Indonesian smelters on Bangka. On October 4th 2006, 23 private smelters on Bangka were raided and closed down by the police as they did not have to proper licenses to operate. The Butterworth plant has a designed capacity of 50,000 million tonnes per year.

POSCO to increase electric steel production capacity by 2009

POSCO recently announced that it has approved an investment of KRW 282.8 billion to expand its electric steel production capacity in order to meet its increased demand.

The investment period will be made during April 2008 to October 2009.

Gas explosion kills 15 miners at Pudeng Coal Mine in Shanxi

It is reported that a gas blast around 1:50 PM on Saturday at Pudeng Coal Mine in Kecheng Township in near Linfen City of Puxian County of Shanxi Province has killed 20 miners. 125 miners were working in the shaft at the time of explosion and 95 miners escaped, but 30 others were trapped underground. The fate of 10 other miners is still unknown.

Mr Zhao Tiechui director of the State Administration for Coal Mine Safety Supervision has asked the rescuers to continue search for the missing while ensuring their own safety. Mr Zhao said that Rescue work is quite difficult since the shaft is still filled with smoke. The smoke inside the shaft is so thick that it's very difficult for us to go down to look for those still trapped.

Local police have put two of the managerial staff of the Pudeng Coal Mine under surveillance.

The cause of the gas explosion is being investigated.

Pudeng Coal Mine has an annual production capacity of 150,000 tonnes a year.

Bucyrus completes purchase of DBT for USD 710 million

Bucyrus International Inc announced last week that it has completed its previously announced acquisition of DBT GmbH, a subsidiary of RAG Coal International AG. It is not known whether any changes were planned for DBT's operations.

Bucyrus, which originally announced the acquisition in December, said in a press release it purchased DBT for USD 710 million in cash and 471,476 shares of Bucyrus common stock with a market value of USD 21 million at the time of the acquisition announcement.

DBT is based at Lunen in Germany and has its North American headquarters in Houston. In addition to its North American headquarters and manufacturing operation in Houston, DBT has seven facilities around the world with 3,200 employees. DBT, with annual revenue of about USD 1 billion, makes roof support systems, armored face conveyers and other coal mining equipment.

Mr Timothy W Sullivan president & CEO of Bucyrus said that the acquisition is a major step for the company, as it adds underground mining equipment to its product line up. He said "We believe our entry into the underground mining equipment industry will enhance our ability to sell original equipment and aftermarket support to a larger segment of the global mining equipment market, and we are very pleased to add DBT's internationally recognized brand and leading market position to our product portfolio.

Bucyrus is one of the world's leading manufacturers of large scale excavation equipment used in surface mining.

United Tractors acquires coal miner PT Dasa Eka Jasatama

ANTARA News reported that publicly listed heavy duty equipment company PT United Tractors through its subsidiary PT Pamapersada Nusantara has acquired 99% of Dynamics Acres Sdn Bhds stake in coal mining firm PT Dasa Eka Jasatama at a price of USD 19.5 million.

The transaction is subject to terms and conditions contained in a Shares Sales Agreement signed by the concerned parties last April 30 and to become effective after all conditions precedent set in the SSA had been fulfilled. If the conditions precedent in the SSA could be met within 9 months Pama would obtain the DEJ stake and own all DEJ shares indirectly.

Mr Djoko Pranoto VP of United Tractors told the Surabaya Stock Exchange that "Part of the transactions value namely USD 14.4 million will be paid in advance in the form of a bank guarantee which DASB can cash subject to conditions stipulated in a shares sale agreement. As part of the agreement Pama will help repay DEJs obligations to third parties totaling USD 11 million."

He said the signing of the SSA was part of Pamas comprehensive plan to settle DEJs claim and previous acquisitions of mining concessions and a coal marketing firm.

Berong to set up a nickel project at Quezon in Palawan

Atlas Consolidated Mining and Development Corps Berong Nickel Corp announced that it is planning to invest PHP 1.2 billion on a new facility that will produce nickel ore at Quezon in Palawan in Philippines. Berong said that the new facility is expected to have an annual processing capacity of 1.47 million tons of nickel ore.

As per report Berong has received a special mines permit from the Philippine government that allows Berong to start mining operations after it completes a feasibility report.

Atlas said it has negotiated to supply up to 50% of the mines output to the BHPBs QNI plant at Townsville in Australia in long term and it intends to have contacts with Chinese and Japanese customers for a shorter term supply.

Japan, US, China, India & South Korea to build emission free pilot power plant

Japanese Nikkei, quoting Japanese government sources, reported that Japan and the United States will lead a 5 nation project to develop a coal fired power plant which discharges no carbon dioxide into the air. The five nations, including China, India and South Korea, are expected to sign a deal this year on technological cooperation for the project.

The report said that the new plant will cut carbon dioxide emissions by some 20% from the level of conventional models by gasifying coal with oxygen before burning it. Then the carbon dioxide generated at the plant will be liquefied and locked in an underground storage facility.

A pilot plant, with a relatively small capacity of about 280,000KW will be built in the United States, with each of the four other countries contributing at least USD 10 million to the project. Most of the cost, estimated to top USD 1 billion, will be borne by the United States, with Japan and other participants supplying technology.

The costs of building and operating the new power plant will initially be twice as much as a conventional coal power station. But the costs will be reduced to make the project profitable by the 2020s.

EU slams Germanys plans to build lignite fired power plants

Germany's Bild newspaper reported that European Environment Commission has slammed Germanys plans to build at least 26 new power stations fired with low energy high polluting brown coal.

Mr Stavros Dimas European Environment Commissioner during an interview said that "Brown coal is the least favorable choice when it comes to greenhouse gases. Those still building new coal fired power stations must be aware that this policy could be expensive for all of us in the long term.

Mr Dimas noted that the EU, under Germany's presidency, had earlier this year committed the bloc to cutting carbon dioxide emissions by 20% from 1990 levels by 2020.

Brown coal, also known as lignite, produces less energy and more carbon dioxide per tonne than do hard coals such as anthracite.

North American Galvanizing & Coatingss Q1 net up by 138% YoY

North American Galvanizing & Coatings Inc announced that its net income in January to March 2007 quarter was USD 2.346 million up by 138% YoY as compared to net income of USD 0.982 million in January to March 2006 quarter. Its sales for the first quarter were USD 23.5 million up by 52% YoY as compared to USD 15.4 million in January to March 2006 quarter.

During January to March 2007, average selling prices for galvanizing and related coating services were 55% higher than the prior year first quarter. The company's ability to increase average selling prices above zinc cost increases had a favorable impact on operating income. The London Metals Exchange market price for zinc for the first quarter of 2007 averaged USD 1.57 per pound, compared to USD 1.02 per pound in the first quarter of 2006, representing a 54% increase.

Its operating income at USD 4.085 million is up by 112% YoY. Forward purchases of zinc at prices lower than current market during the first three months of 2006 contributed USD 915,000 to that period's operating income. Operating income as a percent of sales increased 4.9% for the first quarter of 2007 versus the first quarter of 2006.

Mr Ronald J Evans president & CEO of North American Galvanizing & Coatings Inc said "Strong market demand for hot dip galvanizing continued. Our improved plant operating rates and cost efficiencies combined with an increase in average selling prices resulted in record operating earnings, more than doubling prior year results."

North American Galvanizing is a leading provider of hot dip galvanizing and coatings for corrosion protection of fabricated steel products. It conducts its galvanizing and coating business through a network of plants located in Canton, Ohio; Denver, Hurst, Houston, Kansas City, Louisville, Nashville, St Louis and the Tulsa area.

Construction begins on large coal mine in Xinjiang

It is reported that construction has begun on a large coal mine in northwest China's Xinjiang Uygur Autonomous Region in Ili. The total investment is estimated at CNY 2.6 billion (USD 337 million). It is likely to take 42 months to complete the construction.

As per report the mine is expected to have annual revenue of CNY 1.45 billion and will be the first in Xinjiang to have an annual output capacity of 10 million tons.

The colliery is being built and financed by the Xinwen Mining Group Corporation, China's eighth largest coal mining group based in east Shandong Province.

Xinjiang is estimated to have coal reserves of 2.19 trillion tons.

Perilya forecasts longer lead zinc mine life at Broken Hill

Australia based Perilya Limited has forecast a minimum 6 year mine life for its rejuvenated lead zinc mine at Broken Hill and it expects new drilling to extend that significantly.

Mr Len Jubber CEO of Perilya Limited while speaking at 2007 Paydirt South Australian Resources and Energy Investment Conference in Adelaide said that the company was targeting at least a 10 year mine life. He said that this would be based around further development of the mine's three main ore bodies Potosi, the North Mine and the Southern Operations.

Mr Jubber said that "We have another five years mine life ahead of us based on existing resources and reserves and are confident we can continue to extend the minable ore bodies at their respective boundaries through extension drilling. He added that Good intercepts have already been intersected at Henry George, 10 kilometer to the south and we are targeting satellite ore bodies to feed the existing processing plant which is only operating at 65 to 70% capacity.

Mr Jubber also pointed to Perilya's expanding second cornerstone business, its AUD 35 million (USD 28.9 million) Flinders high grade zinc project near Leigh Creek in South Australia. He said the company was on track to direct ship its first 15,000 million tonnes of ore from the Stage 1 Beltana open pit by year end.

Thai Banpu plans IPO for PT Indo Tambangraya Megah

It is reported that Thailand's biggest coal miner Banpu Pcl is planning an initial public offering with hopes of raising USD 100 million for its Indonesian operations.

Mr Somruedee Chaimongkol CEO of Banpu Pcl said the company will use USD 45 million to expand its Bharinto mine in Indonesia and USD 50 million for a new mining project in the country.

Banpu said in a statement to the Stock Exchange of Thailand that it will provide details of the initial public offering of PT Indo Tambangraya Megah in which it holds a 95% stake at a later date.

Comprehensive report on Indian steel sector

The Indian steel industry is poised for massive expansion. Dramatic consumption growth over the last few years has stimulated enormous expansion plan, facilitated by unexploited iron ore raw material base. India is now being hailed as the new China, where crude steel production soared from less than 100 million tones in 1995 to over 400 million tones in 2006.

Indian crude steel output at just 38 million tonnes in 2005 is starting from a much lower base, and the economic steel- consuming structure of China is substantially different from India. Nevertheless, India has recently established a long-term goal of raising crude steel production to 100 million tonnes per annum by 2020.

UK based GFMS Metals Consulting in an innovative way and value for money report on Indian steel industry includes complete statistical coverage of the industry, an unbiased and frank assessment of growth expectations, a base case outlook for each steel product & the industry as a whole with a clear view of potential risks, an assessment of raw material availability and trends and production, trade and consumption forecasts out to 2011.

The report coverage includes historic production, trade & apparent consumption of carbon steel both long and flat products, raw materials, producers, economic environment, political and other risk factors.

If you are interested to know more about it please visit
http://www.steelguru.com/GFMS_MC/indian_steel_report.php
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