Shougang Hierro Peru, a unit of China’s Shougang Group, and Peru’s only iron ore producer, plans to invest $1.5 billion to expand processing capacity and build a desalinization plant at its Marcona mine, according to several media reports.
The company expects to produce an additional 10 million mt/year at its existing Marcona mine. Currently, Shougang produces 11 million mt of iron ore per year. The Peruvian iron ore producer should complete the expansion of the Marcona mine by H2 2018, when it should reach over 20 million mt/year in capacity.
Earlier this year, in June, Shougang Hierro Peru obtained $500 million in financing from the Industrial and Commercial Bank of China (ICBC) to fund the second phase of its proposed Marcona mine expansion project.
The $500 million in financing from ICBC will be combined with another loan of $200 million from DBS Bank, Hong Kong branch, to expand the Marcona mine.
A company’s executive said this week using fresh water through the desalinization process will allow it to have a better product that can be sold at higher prices.