Japanese steelmaker Kobe Steel has announced that it has reached an agreement with Japan-based trading firm Sojitz Corporation to acquire a 33 percent equity share in Sojitz Resources & Technology Pty Ltd, a 100 percent owned subsidiary of Sojitz Corporation.
Sojitz Resources has a 30 percent stake in the Southdown magnetite project located in Western Australia. Acquiring shares in Sojitz Resources will allow Kobe Steel to indirectly hold a 9.9 percent interest in the Southdown project. Kobe Steel will also purchase1.5 million mt of the magnetite pellet feed produced from the project, contributing to cost reductions at the pellet plant at its Kakogawa Works.
The Southdown project will produce 10 million mt of premium magnetite pellet feed with about 69 percent iron content. First shipment from the project is expected in 2015, while the total cost of the project is estimated to reach approximately JPY 250 billion.