The Brazilian flats producer Usiminas announced that the investments required for the refurbishment of its coke plant in the Ipatinga plant will reach BRL 1.1 billion ($216 million), compared to previous estimates of BRL 500 million.
The company also announced that the refurbishment of blast furnace number 3 of the same plant will cost BRL 633 million more than expected, reaching now BRL 2.7 billion.
With the announcements, the shares of Usiminas traded in the São Paulo stocks exchange declined by 6 percent, as analysts were expecting lower refurbishment costs, one of them adding that the additional expenses represent around 5 percent of the market capitalization of the company.
The company informed that the refurbishments are virtually like the building of new units, as both the coke plant and the blast furnace are very old units, adding that the analysts were basing their costs assumptions on the cost of conventional refurbishments of not so old similar units.
According to Usiminas, most of the expenditures related to the coke plant will occur between 2024 and 2026, while for the blast furnace the major expenses are due for 2023.
