SteelOrbis Shanghai
Sources report that the National Development and Reform Commission (NDRC) has just given the official go-ahead to Magang Group Holdings for the commencement of
construction work on the Luohe
iron ore. The annual output of this project is expected to reach three million mt for crude ore, 983,100 mt for 66-percent refined
iron ore, and 306,000 mt for 39.8-percent refined sulfur ore. The total investment involved is RMB 1.1 billion ($140 million).
Since the late 1970s, Magang has carried out preparation work for the Luohe
iron ore project. However, due to the complicated geological environment and various exploration difficulties, the
construction of a special railway was deemed necessary for transportation to Maanshan. More importantly, in the past the demand level was very low due to
China's low level of economic development.
However,
China's economic development has seen great advances since then. Furthermore, Magang's supplies from its existing
iron ore mines are waning, with resources expected to run out in the coming three to five years. Therefore, the new project will secure Magang's raw material supply, thereby holding great importance for Magang's sustainable development.