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:: Samancor Chrome to spend R1,4bn on local value-add projects by 2010
Ferrochrome producer Samancor Chrome would spend R1,4-billion on beneficiation projects in South Africa over the next two years, including a new pelletiser plant, a DC furnace and a smelter, the firm told Mining Weekly Online last week.
Speaking in an exclusive interview at Samancor’s offices in Sandton, CEO Jurgen Schalamon said that the company was also undertaking a feasibility study for a chrome chemicals plant, which, if approved, would require an R800-million investment.
It would probably be put up in Middelburg in 24 months to 30 months time.
Further, the company was planning on more than doubling its ferrochrome production capacity by 2015, to 2,7-million tons a year, in a three-phase greenfields programme.
“Our new DC furnace will be coming on stream in the beginning of the third quarter next year, between August and September 2008," Schalamon stated.
It would be a 60-MW furnace, with a capacity of between 110 000 t/y and 115 000 t/y capacity.
“We also plan to build a pelletiser plant in Middelburg, which will be our third," said Schalamon.
The new pelletiser plant would be commissioned in some 21 months time, at a cost of R550-million, and its price had been driven up by about 40%, mainly because of cost hikes in South Africa’s booming construction industry, he noted.
“We are ramping up our Doornhoek mine where we will build a beneficiation plant for our ore, worth around R240-million," Schalamon added. “With these three projects combined we are looking at an investment of R1,4-billion over the next 21 months."
Meanwhile, the greenfields expansion programme included three modules, with each of them bringing some 500 000 t of ferrochrome production capacity on line.
Samancor Chrome’s current ferrochrome capacity was some 1,2-million tons, and the planned expansion would more than double this.
This would take place between 2010 and 2015.
Tubatse Ferrochrome GM Chris Jordaan further added that the building of the pelletiser and additional furnaces, and the expansion of the Doornhoek mine “clearly supports the fact that we are into beneficiating products in South Africa as opposed to exporting raw material”.
Meanwhile, Schalamon reported that the effective date for Samancor’s deal with Chinese Sinosteel was “imminent”.
The firm disclosed in November that it would sell a 50% holding in two of its existing operations, the Tubatse Ferrochrome smelter and the Tweefontein mine, to China’s State-owned Sinosteel, for R1,7-billion.
“Sinosteel is a strategic partner, they have a good knowledge of the Chinese market and offer good entry points for Samancor into the Chinese market for ferrochrome," Schalamon said.
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