October 20, 2010 / 6:48 AM / 9 years ago

Xstrata to spend $710 mln on ferrochrome expansion

A labourer works in a ferrochrome factory at Bharibramna, 20 km (12 miles) west of Jammu, July 15, 2008. REUTERS/Amit Gupta

LONDON (Reuters) - Miner Xstrata will spend $710 million to boost capacity of ferrochrome production and cut costs with a more energy-efficient smelter in South Africa, which is struggling to meet power needs.

Xstrata, one of the world’s biggest producers of ferrochrome, a key component in stainless steel, said in a statement on Wednesday it had approved the second phase of its Lion ferrochrome complex.

“The use of our energy-efficient Premus technology for the expansion project will expand Xstrata’s cost leadership in a global environment of escalating energy costs,” Xstrata Alloys Chief Executive Peet Nienaber said.

Under the expansion project, a new smelter will be built with a capacity of 360,000 tonnes per year, boosting the group’s overall ferrochrome capacity to over 2.3 million tonnes.

The project is due to reduce overall costs of ferrochrome production by around 6 percent, Xstrata said.

Xstrata’s joint venture partner, Merafe Resources Ltd, has the right to participate in the expansion at a 20.5 percent level.

“Merafe will be assessing Lion II and an announcement regarding the company’s participation in the project will be made by the end of the year,” it said in a separate statement.

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below