INDUSTRIES - Steely focus.Summary: Brazil's Vale SA has officially opened its nine million tonne iron ore plant in Oman.
TEXT BY PETER SHAW-SMITH
REGIONAL STEEL PRODUCTION has undoubtedly played hostage to the fortunes of the downturn, given the capital intensity and cyclicality of the industry, but global steel demand remains so high that formidable supply is always potentially on call. so when Brazil's Vale sa, one of the world's leading iron ore producers, officially opened its nine million tonnes a year iron ore pelletising plant at sohar in Oman earlier this year, it was seen as an important sign of the global commitment to the region's steel business.
production of iron ore - the main ingredient for steel manufacture - has been growing steadily in the region in the past decade, with Vale one of two major players. now it will produce nine million tonnes a year, which, added to rival Gulf Industrial Investment Corporation's (GIIC GIIC Global Information Infrastructure Commission
GIIC Gulf Industrial Investment Company (Safat, Kuait)
GIIC Gujarat Industrial Development Corporation (India) ) existing 11 million tonnes per annum Per annum
Yearly. (mpta) in Bahrain, makes the region a formidable pellet producer in its own right.
direct reduction (dr) pellets are an intermediate input to the steel-making process, and ideal for the small electric- arc furnace-type largely used in the Gulf and Middle east, which produces over 25 per cent of global dr output.
GIIC is now the region's biggest player, looking to increase capacity with new plants in Oman and egypt. the plans for salalah and ain el-sukhna have been on the table for at least four years and have failed to move forward, reflecting the stalled demand dynamics that the regional steel industry has seen in the slowdown. Oiginally, Vale was a joint- venture partner of GIIC, but pulled out in 2006 citing "different views about... business management," selling its GIIC stake for $418 million.
Vale's interest in Oman also stems from the increasing bad blood in its relations with China. In 2007, Vale decided to create its own shipping fleet to manage the lucrative ore trade to China, producer of just under half the world's steel. China's shipping community has reacted with suspicion to the Brazilian mining giant's attempt to control not only iron ore pricing, but freight costs as well.
When Vale announced the newbuild programme for 35 very large ore carriers (VlOCs) or so-called "valemaxes," it was less vocal about the fact that it would need Chinese financing for some of the vessels. as a result, clarity on the orders of 12 vessels from Chinese yard rongsheng took years to emerge, and it's still unclear when the ships will be delivered. Oman shipping Company also ordered four similar vessels from rongsheng, which Vale will charter, or lease.
Of the 35 valemaxes Vale plans to build in the next two years, only six have been delivered, and only one has succeeded in getting a cargo through to port in China, at dalian, in december. In January, China's transport ministry announced a ban on all bulk carriers over 350,000 dwt entering its ports, a thinly veiled reference to Vale's VlOC operations.
Vale has responded to China's hostility by creating a floating transhipment hub in the philippines, and a distribution centre in Malaysia. the plant and distribution centre in Oman is also part of its response. "We should have physical centres where we feed in and link into bigger vessels, and stock, blend and distribute with quality for our clients wherever they are," said Marcelo Figueiredo, Vale's project portfolio director for Oman and Malaysia. "as for moving to the Middle east and asia-pacific with this strategy, it can serve for both. From [sohar], we [can] serve the Middle east, Indian and asia- pacific markets. From Malaysia, we will be able to serve asia-pacific and even China and Japan."
Vale Oman employs 1,200 directly, with 450 of them Vale employees and 750 local contractors working on site, and 3,120 jobs generated indirectly. Vale officials put the Omanisation rate at 63 per cent.
Vale awarded contracts of around $420 million to local companies during construction over the last five years and completed a study of the al Batinah region Al Bāţinah (Arabic: الباطنة) is one of the regions (mintaqah) of Oman.
Al Batinah Region, otherwise known as Al Batinah Coast is one of the most highly populated regions of Oman. to partner with sohar aluminium and Oman Oil refineries This is a list of oil refineries. The Oil and Gas Journal also publishes a worldwide list of refineries annually in a country-by-country tabulation that includes for each refinery: location, crude oil daily processing capacity, and the size of each process unit in the refinery. and petroleum Industries Co. to deliver social programmes from its local presence.
Jose Carlos Martins Carlos Jorge Neto Martins (born on 29 April 1982 in Oliveira do Hospital, Portugal) is an attacking midfielder of Recreativo de Huelva and Portugal. Club
Carlos is a product of the youth training system of Sporting. , head of ferrous ferrous (fĕr`əs), iron in the +2 valence state.
Containing or having to do with iron. The difference between ferrous and ferric is the number of valence electrons they contain (ferrous contains two and ferric contains three), which and strategy, said a Vale team was mapping exploration in Oman with a view to finding phosphates and other mineral resources in commercially recoverable quantities. "We are going to share this information with the Omani government," he said. "Vale is undertaking an assessment of mineral potential in Oman based on historical geological information to identify exploration target areas with the geological potential to host metallic and non-metallic deposits, primarily copper and potash potash: see potassium carbonate.
Name used for various inorganic compounds of potassium, chiefly the carbonate (K2CO3), a white crystalline material formerly obtained from wood ashes. ."
the miner may consider doubling plant capacity to 18mtpa, at an additional investment of $1 billion, after apparently receiving a commitment from the government of Oman for additional gas to power the pelletising expansion. "Infrastructure (port and land) was designed already to reach that capacity," said Martins. "the market will drive the implementation time. Vale has just started the process to get additional gas for its future expansion."
Martins was accompanying Vale CeO, Murilo Ferreira, on his first trip to Oman, where Vale officially inaugurated its plant by achieving full production capacity. "We are very positive for the [global] market for the year," said Ferreira. "Quarter one is weak, but we are confident that the second and third quarters will see an improvement." Iron ore prices have languished around the $140 per tonne mark of late, but are expected to trend towards around $160 per tonne by the end of the year.
In addition to the 35 valemaxes, Vale owns or charters another 60 smaller class vessels to carry out its global iron ore distribution. In June 2009, Oman shipping Company ordered the Vale liwa, Vale sohar, Vale shinas and Vale saham for $480m from rongsheng for Vale's global distribution network, all ships the Brazilian company will charter.
Vale is believed to be supplying saudi arabia's Hadeed, a unit of saBIC, with 3.5mtpa of dr pellets. Jindal shadeed, a plant next door to Vale Oman in the industrial port, and a venture formerly owned by abu dhabi Abu Dhabi (ä`b thä`bē, zä–, dä–), Arab. Abu Zabi, sheikhdom (1995 pop. 928,360), c. investors now in Indian hands, is also a pellet offtaker. Other customers in the region include Qatar steel, saudi arabia's private sector player al tuwairqi, egypt's ezz steel and suez steel Suez Steel is an steel company located in Ababia, Egypt. As of September 2006, Banque du Caire, which owns or owned up to 80% of Suez Steel's stock, has offered the stock for sale.
The company's stock is listed on Egypt's stock exchange. and direct reduction plants in south-east asia South-East Asia n → le Sud-Est asiatique
South-East Asia south n → Südostasien nt
South-East Asia n → , Martins said.
"Vale Oman emplOys 1,200 directly, with 450 Vale emplOyees and 750 lOcal cOntractOrs wOrking On site, and 3,120 jObs generated indirectly. Vale Officials put the OmanisatiOn rate at 63 per cent."
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