TPT July 2007

From the

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ugust

2007

for offshore oil rig construction as well as alternative energy sources

like wind turbines.

“We like energy,”

Mr Sutherland told the

Times

• Of related interest, also on May 4 it was reported that Norilsk

Nickel of Russia had made an all-cash bid of US$4.8 billion for the

Canadian nickel and gold producer LionOre Mining International,

topping the $4.1 billion bid by Xstrata, of Switzerland. Analysts

said they expected Xstrata, based in Zug, to respond with a

new bid. LionOre, based in Toronto, has operations in Australia,

Botswana, and South Africa. Moscow-based Norilsk is one of the

world’s largest producers of nickel and palladium.

India’s Essar Group is buying Minnesota Steel,

Algoma Steel

On April 19, Essar Global Ltd – which earlier in the week announced

a $1.63-billion takeover of Canada’s Algoma Steel – said it had also

agreed to acquire privately owned Minnesota Steel Industries and

invest $1.65 billion to build an integrated steel plant in Nashwauk,

northwest of Duluth. The site in the Mesabi Iron range has abundant

taconite reserves in an open-pit mine, and according to Minnesota

Steel management this would be the first vertically integrated ‘mine

mouth’ steel plant in North America.

Construction is due to start in the third quarter, with the first phase

scheduled to be commissioned in 2009. Raw steel capacity of

2.5 million tons per year of slabs is projected for the first phase.

There was no official notice that the US and Canadian operations

would be combined, although

Metal Producing & Process

(Penton

Media) reported that one Essar official acknowledged that

possibility. Algoma Steel, in Ontario, will have a raw steel capacity

of about 3 million tpy when capital improvements, now underway,

are completed.

Metal Producing & Process

also reported that a number of

equipment contracts have been let for the Minnesota plant. HYL

Technologies (Mexico) will supply a 1.8-million tpy DRI (direct

rendering infrastructure) module, while Danieli & C SpA (Italy) will

provide a 1.6-million tpy electric melt shop and thick-slab and thin/

soft-reduction slab casters. Algoma Steel is similarly equipped, but

is fed by blast furnaces rather than a DRI plant.

The Minnesota and Algoma deals will give Essar Global, the

international division of the Essar Group conglomerate, a

significant presence in North America. Essar already employs

more than 3,000 people in the US, of a global workforce of

20,000. Essar Global chairman Shashi Ruia stated,

“Minnesota

Steel is exciting as it gives us a cornerstone in the North

American market. From this we will further expand our global

steel business.”

Essar produces more than 4 million tpy of steel in India, and is

expanding in such low-cost markets as Vietnam and Trinidad &

Tobago. Indian firms are prominent in a consolidation trend in

the steel industry, driven by surging demand from fast-expanding

economies – China’s in particular.