Shandong plans to develop Brazil ore building up self-sufficient overseas ore deposit
Currently, Shandong Iron and Steel Group (hereinafter called Shangang) joined hand with Xinwen Mining Group (hereinafter called Xin Mining signing the cooperative framework memorandum with Hong Kong Hongqiao Group, intending to jointly develop Brazil SAM iron ore project.
According to the framework memorandum, three sides made the initial consensus that Xin Mining is in charge of exploration and preparation, after the project formally operates, they will discuss the cooperative development details; after the exploration is completed, Shangang will raise capital to develop this project.
On March 29, reporters did not contact Shangang and Xin Mining, so they did not know capital input by these two companies.
Shangang is a large-scale steel enterprises integrated Jinan Iron and Steel, Laiwu Iron and Steel and other Shandong's related enterprises, and Shangang is integrating Rizhao Iron and Steel, targeting to building up a refined steel production base with annual production of 20mln tons.
Shandong province is eager to obtain Brazil's ore mine. In the beginning of March, Hongqiao Group bought aforesaid Brazil iron ore project, at the end of March, Shandong's two enterprises inked the above-mentioned cooperative framework memorandum with Hongqiao Group.
Brazil SAM iron ore project holds 6.2bln tons of deposit, owned by South America's VNN. In March 2010, Hongqiao Group purchased its exploration ore right, its project investment is estimated to reach U.S.$2.588bln, with the planned refined ore powder production of 25mln tons.
Hongqiao issued the statement that SAM is private company registered in Brazil, SAM and its related companies hold 94 exploration licenses. After Hongqiao acquires SAM, SAM and related companies' exploration licenses will transferred to SAM.
Shangang's subsidiaries highly reply on the imported iron ore. Signing the cooperative framework memorandum is of great significance to resolve Shandong's short iron ore resource issue. This move reflects that Shangang aims at building up its own overseas iron ore supply site.
