Nov 21 2007
Companhia Vale do Rio Doce – (CVRD) is negotiating with Dongkuk Steel, one of the largest steel producers in South Korea, the construction of an integrated steel slab plant in the Industrial District of Pecém, in the Brazilian State of Ceará. The memorandum of understanding (MOU) is expected to be signed in November 20, 2007.
The viability study of this project is expected to be completed in coming months. The project encompasses the construction of an integrated coal-based steel slab plant with an initial production capacity of 2.5 million tons per year, with the possibility to be expanded to 5 million tons per year. The investment for the first phase of this project is expected to be US$2 billion.
This initiative is consistent with CVRD’s strategy of attracting new investments in the steel industry in Brazil, through minority stakes, thereby increasing iron ore consumption in the country. This is the third largest steel project CVRD is undergoing in the past three years, including ThyssenKrupp CSA in the State of Rio de Janeiro, and Baosteel CSV, in the State of Espirito Santo, Brazil, increasing the country’s steel production capacity by 12.5 million tons with investments around US$10 billion.