21 Aug 2009 11:22

Baotou Steel Union plans iron ore pellet JV project

Shanghai. August 21. INTERFAX-CHINA - Inner Mongolia Baotou Steel Union Co. Ltd., a Shanghai Stock Exchange-listed subsidiary of Baotou Iron and Steel Group, announced on Aug. 21 that it plans to partner with Inner Mongolia Dazhong Mining Co. Ltd. to build an iron ore pellet facility in Bayannaoer City in the Inner Mongolia Autonomous Region.

The joint venture pellet project, which will have a designed production capacity of 1.2 million tons per annum, will supply raw material to Baotou Steel Union's steelmaking facilities.

Baotou Steel Union aims to further consolidate the iron ore resources in the mineral-rich city of Bayannaoer through the joint venture, which is expected to take a year to complete.

The joint venture will have a registered capital of RMB 300 million ($43.92 million), of which Baotou Steel Union will contribute RMB 260 million ($38.06 million) and Dazhong Mining RMB 40 million ($5.86 million). Baotou Steel Union will hold an 86.67 percent stake in the joint venture and Dazhong Mining will own the remaining 13.33 percent.

Baotou Steel Union produced 9.54 million tons of pig iron and 9.82 million tons of crude steel, as well as exported 787,000 tons of steel products in 2008.

Baotou Steel Union shares stood at RMB 4.61 ($0.67) at 2:30 p.m. Beijing time in Shanghai, up 1.52 percent from the previous trading day.