China’s Sinosteel assumes Mutún steel and iron project in Bolivia

Wednesday, 20 January 2016 23:22:53 (GMT+3)   |   Sao Paulo
       

The Bolivian government has chosen China’s Sinosteel to develop its Mutún steel and iron ore project, the nation’s mining ministry said this week.

After stepping back in its previous decision in late 2015 to accept the same contractor, the Bolivian government gave one more chance for the two companies competing in the public tender to make their proposals.

Cesar Navarro, Bolivia’s mining minister, said the directors of state-run company Empresa Siderurgica del Mutún (ESM) elected with six votes Sinosteel as the company which will develop the steel and iron project. The second company competing in the public tender, Henan, received just one vote.

Navarro said Sinosteel is expected to sign a final contract soon.

“First, we hope that the [elected] company will not only deliver us the El Mutún [project], but will also let it start producing. Second, the product that the company will deliver should be commercially feasible and competitive, in other words, with ISO characteristics,” the official said.

Sinosteel had initially proposed a $388 million investment for a non-flat finished steel mill, while Henan, another company competing in the public tender, said the development of the project would cost about $442.1 million, including a gas pipeline stretch as well as a steel pipe.

In October, the Bolivian government said the Mutún iron and steel complex should start up by 2019. The building and the implementation of the complex and all its plants should take 36 months.

ESM expects to meet up to 60 percent of the country’s demand for steel.

The Mutún iron and steel complex project includes concentration, pelletizing and direct reduction plants, which would be attached to a rolling mill. The rolling mill would be able to produce 150,000 mt of non-flat finished steel. Once the plant is ready to start-up, Bolivia could save up to $230 million per year, as it won’t need to import finished steel from Brazil and Peru.

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