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Posco Signs MoA with Vale, Dongkuk to Join Steel Mill Project
11/08/2010 - Posco has signed a Memorandum of Agreement (MoA) with Vale and Dongkuk that establishes the terms for its entry in the Companhia Siderúrgica do Pecém (CSP) project. The next steps will be the negotiation and signing of a Shareholder Agreement, expected for the beginning of next year.
Posco has signed a Memorandum of Agreement (MoA) with Vale and Dongkuk that establishes the terms for its entry in the Companhia Siderúrgica do Pecém (CSP) project. The next steps will be the negotiation and signing of a Shareholder Agreement, expected for the beginning of next year.
Posco announced in July its intention to join Vale and Dongkuk in the CSP steel mill project, which is being built at the Pecém Industrial and Port Complex (CIPP) in the state of Ceará, Brazil. The new CSP shareholders participation is expected to be Vale 50%, Dongkuk 30%, and Posco 20%.
“The entry of this new partner will add even more value, as we will be supported by Posco’s technology and operational experience in major integrated steel mills,” said Aristides Corbellini, Director of Vale’s Steel Business.
CSP will be an integrated mill capable of producing 3 million tonnes of steel slabs for the export market; this figure may reach 6 million tonnes in a second phase. Implementation began on December 16, 2009, and earthmoving activities are currently proceeding. The steel mill is due to be operating in 2014.
CSP is an important private project in the Northeast region of Brazil, requiring a planned investment of US$4 billion. A significant portion of the total investment is said to be allocated to acquiring modern equipment to monitor and control air emissions, liquid effluents, and other waste.
In addition to steel slabs, CSP will also produce electricity for its own use, with surplus power sold on the domestic market.
Steelmaking projects in which Vale is directly participating involve a total investment of US$21 billion and the generation of more than 80,000 jobs during construction. The projects will add 18.5 million tonnes a year to domestic steel production, which in 2009 stood at 42.1 million tonnes of crude steel, according to the Brazilian Steel Institute.
Posco is South Korea’s largest steel producer and one of the world’s biggest steelmakers.
