ENRC increases capital expenditure program to $11.1 billion

Kazakhstan-based mining group Eurasian Natural Resources Corporation Plc. (ENRC) has announced that it has increased its capital expenditure program to an estimated $11.1 billion for expansionary projects which are in execution, planning and design and pre-feasibility stages, of which $2.5 billion will be invested in 2011. For 2010, ENRC's capital expenditure amounted to $1.187 billion, up from $1.147 billion in 2009.
 
ENRC eyes 440,000 mt ferroalloy output expansion by 2013
 
ENRC's investment program for its ferroalloys division includes the construction of four new direct current furnaces at the Aktobe plant with 440,000 mt of capacity. The new furnaces will replace some 270,000 mt per year of old ferroalloy smelting capacity. The feasibility study for the project was completed some time ago and the plant is currently under construction. Supply agreements for capital equipment and machinery, as well as engineering, procurement and construction contracts have been signed. The total project cost is approximately $750 million, with completion planned for 2013.
 
ENRC plans $6.78 billion capex for iron ore division expansion
 
For its iron ore division, ENRC plans a capital expenditure of $6.78 billion, following favorable feasibility studies and the overall improved conditions in the steel industry. ENRC's iron ore division is working on the following projects:
 
-  Expansion of the ore base including the enlargement and reconstruction of deposits at the Kachar and Rudny sites, as well as the development of a new deposit at Sorsk. The commissioning date has been postponed to 2015 to reflect recent updates of the mining expansion strategy. The estimated expenditure for the mine expansion is $720 million.
 
- The construction of a high quality concentrate plant with total capacity of seven million mt per year by 2014 at an estimated total cost $440 million. High quality concentrate will be used as raw material for production of high quality pellet and for direct sales to customers. In 2010, preparation works took place and project documentation has been submitted to the government authorities.
 
- The construction of a high quality pelletiser plant of three million mt per year capacity and a hot briquetted iron (HBI) plant with a capacity of 1.8 million mt per year by 2014. The total project cost is estimated to be $920 million.
 
These projects will allow ENRC to expand its product base, offering three new products - high quality concentrate, high quality pellet and HBI - and increasing total saleable output to approximately 23 million mt per year by 2015.
 
In addition, at the end of 2010 ENRC expanded its iron ore division with the inclusion of Bahia Mineração's iron ore division which operates the Pedra de Ferro Project (the BML project), at a current estimated total capital expenditure cost of about $2.1 billion.