Mar 2 2004
BHP Billiton have announced their intention to enter into the Wheelarra Joint Venture with four of China’s leading steel mills:
- Wuhan Iron and Steel (Group) Corp
- Maanshan Iron and Steel Company Ltd
- Jiangshu Shagang Group Co Ltd
- Tangshan Iron and Steel (Group) Co Ltd
The joint venture represents BHP Billiton’s largest ever commercial agreement with China’s steel mills. It is expected to be worth a total of approximately US$9 billion over the next 25 years, equating to about 12 million tons per annum of iron ore.
Under the arrangement, the Chinese steel mills will take a 40% interest in a sub-lease over BHP Billiton’s Jimblebar mine. BHP Billiton will retain a controlling share holding a 51% share, with CI Minerals Australia and Mitsui Iron Ore owning 4.8% and 4.2% respectively.
while the deal is yet to be formalized, BHP Billiton will begin shipping an additional 4-6 million tons per year to their Chinese customers, effectively doubling their sales to these customers in 2004.
For more information on steel manufacture, click here.