CVRD eyes iron ore project in Mongolia

CVRD eyes iron ore project in Mongolia

Brazilian iron ore producer Companhia Vale do Rio Doce (CVRD) announced that it, along with the Japanese trading firm Itochu Corp, would commence a feasibility study for coal mining operations in southern Mongolia. The project would be the first coal development project in southern Mongolia. According to the project, Itochu and CVRD plan to develop the Tavan Tolgoi coal deposit, whose reserves are estimated at about 600 million tons. About 83% of the project's total output will be destined for use as coking coal. CVRD and Itochu will form joint ventures with other Mongolian and Chinese firms to build roads, railways, a power plant and other infrastructure facilities required for the project. If the project proceeds, it is expected to start yielding results in 2009. Most of the coal produced will be exported to Japan and China.