Online BusinessTata Steel partners NML; to invest 300 mn Canadian dollar
Tata Steel today said it has entered into a joint venture agreement with Canadian mining firm New Millennium Corp for development of an iron ore project in North America, in which the Indian firm would invest 300 million Canadian dollars.
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The world"s sixth-largest steel producer, Tata Steel, which signed the pact through one of its subsidiaries, aims to achieve raw material security for its European operations through assured supply of iron ore from the project.
"Tata Steel Global Minerals Holdings has entered into joint venture agreement with New Millennium Capital Corp (NML) and LabMag Limited Partnership (in which NML controls majority stake) for development of the Direct Shipment Ore (DSO) Project in Canada," the company said in a statement.
It said that the feasibility study for the DSO Project was underway based upon which the company may make its investment decision within 180 days from delivery of feasibility report.
"Tata Steel will arrange fund for 100 per cent of the project cost (of) up to 300 million Canadian dollars for 80 per cent equity stake in the joint venture company with NML holding a 20 per cent stake," the statement added.
The DSO project contains an estimated 100 million tonnes of direct shipping quality ore and NML expects an annual production of four million tonnes of iron ore from it.
Tata Steel, which has 100 per cent offtake right from the DSO project, expects that initial production would start from the mines in the second quarter of 2011.