Palabora May Invest $1 Billion, Boost Iron-Ore Output Fivefold
By Claire Leow
bloomberg.com
April 9 (Bloomberg) -- Palabora Mining Co., operator of South Africa's largest copper mine, may invest as much as $1 billion to increase output of iron-rich magnetite five times to take advantage of surging prices, an executive said.
The company, controlled by Anglo American Plc and Rio Tinto Group, already supplies 2 million tons a year to China Minmetals Corp., Chief Financial Officer Charles Asubonten said today in an interview. The magnetite reserves contain 60 percent iron.
Iron-ore prices have jumped for six years to a record on demand led by steelmakers in China, the world's biggest maker of the alloy. The expansion will cost between $500 million and $1 billion, Asubonten said.
``We have the capacity to increase it to 10 million tons annually because we have 240 million tons-plus of magnetite reserves,'' Asubonten said in Singapore. ``Iron-ore prices being where they are today, it's a viable project. If we get into this hard and heavy, it will be 2009.''
Palabora signed a three-year agreement in 2006 to supply magnetite to China Minmetals, the Asian nation's largest metals trader.
To contact the reporters for this story: Claire Leow in Singapore at cleow@bloomberg.net
Last Updated: April 9, 2008 00:46 EDT |
