Tata Steel acquires 80 percent stake in Canadian iron ore project

On September 14, Indian steel giant Tata Steel announced that it has decided to exercise its option of acquiring an 80 percent interest in the direct shipping ore project of New Millennium Capital Corp, Canada (NML).
 
As part of the joint venture agreement, Tata Steel will reimburse NML 80 percent of NML's cost to date on the DSO project, will arrange funding up to CA$300 million of capital costs for the project to earn its 80 percent share of the JV and will commit to take 100 percent of the DSO project's iron ore products of specified quality, at world market prices, for the life of the mining operation.  It is expected that the JV will produce 4 million dwt per year of iron ore products commencing in 2012.
 
NML's DSO project contains 64.1 million metric tons of proven and probable iron ore reserves at an average grade of 58.8 percent Fe.
 
Tata Steel has up to now owned 27.4 percent of NML and is the company's largest shareholder and strategic partner.