Aug 26 2004
BHP Billiton today announced its intention to form a joint venture with Japan’s JFE Steel Corporation, a recently merged entity of Kawasaki Steel Corporation and NKK.
The joint venture will be BHP Billiton’s first iron ore joint venture with a Japanese steelmaker and will underpin sales of approximately 16 million tonnes per annum (Mtpa) of iron ore from BHP Billiton’s suite of products over the next 11 years, valued at around US$3.7 billion.
The joint venture involves the joint technical development and commercialisation of 160 million tonnes of Lower Channel Iron Deposit (LCID) ‘pisolite’ iron ore, which has not previously been used in the steel making process. Development of these reserves will also extend the life of the Yandi Mine.
Under the joint venture, JFE will take a 20 percent interest in a sub-lease over part of BHP Billiton’s Yandi mine known as ‘Western 4’, near Newman in Western Australia, which has an ore reserve of 109 million tonnes. BHP Billiton will retain a 68 percent interest, with Japanese joint venture partners ITOCHU Minerals & Energy of Australia and Mitsui Iron Ore Corporation retaining 6.4 percent and 5.6 percent interests respectively.
The Western 4 deposit will provide up to 15 Mtpa of iron ore, which will be included in the Yandi product. Production, which is expected to commence in the second half of 2005, will be achieved utilizing existing Yandi infrastructure and facilities.
President BHP Billiton Iron Ore Graeme Hunt said the company was pleased to consolidate and strengthen a long standing relationship which existed prior to the formation of JFE with both Kawasaki Steel and NKK.
“Kawasaki Steel was an initial customer for the Yandi product and this early long term support and technical assistance with product development expanded our relationship substantially. In addition, we have enjoyed a strong supplier/customer association with NKK for over 30 years,” he said.
“Today, we have taken a further step in these relationships through JFE and this new partnership will strengthen our bond with one of the world’s most highly regarded steel producers.”
The information in this report that relates to Ore Reserves is based on information compiled by Peter Schultz who is an employee of BHP Billiton and who is a Member of The Australasian Institute of Mining and Metallurgy.
Peter Schultz has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 1999 Edition of the "Australasian Code for Reporting of Mineral Resources and Ore Reserves". Peter Schultz consents to the inclusion in the document of the matters based on his information in the form and context in which it appears.
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Posted Augsut 26th. 2004