The Brazilian-South Korean Companhia Siderurgica do Pecem (CSP) slab steel mill venture under construction in northeastern Brazil plans to procure its 2.4 million mt/year metallurgical coal requirement independent of the project's biggest shareholder, iron ore and coal miner Vale.
Vale, which owns met coal mines in Australia and Mozambique, will be able to offer coal to the project, but procurement will be decided by the integrated mill project company alone, CSP President Marcos Chiorboli said in Rio de Janeiro Monday. Vale is supplying all the iron ore requirements.
The 3 million mt/year slab project will procure coking coal for its coke batteries, and PCI for injection in the blast furnace, Chiorboli told the Coaltrans Brazil conference.
The various coal types to be used will be analyzed closer to the start of production, he said. US coal miners are expected to show an interest in offering hard coking coal and injection material after recently boosting their share of Brazilian imports.
The project's iron ore will come mainly from Vale's Carajas operations in northern Brazil, with some material from the Southern System as well, he said. Pellets may account for 20% of requirements, he said.
The project will have a desulfurization phase for pig iron produced in the blast furnace, vacuum degasser as well as other units for slab production.
CSP's shareholders include mill operator Posco with 20%, and Dongkuk Steel Mill with 30%, which plan to send the majority of the slab produced by the first phase of the project to South Korea, as well as possibly Mexico in Posco's case, Chiroboli said.
Dongkuk will take 1.6 million mt/year of slab, Posco will take 800,000 mt and Vale will take 600,000 mt for its California Steel Industries plant, he said.
The shareholder agreement includes an expansion to 6 million mt/year and a final investment decision will come a year after the initial phase's start of production, Chiorboli added. "It will be decided one year after start up, so in 2017," he said.
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