Tata Steel in iron ore venture with Canada's New millenium
07 Nov 2009
Tata Steel entered into Joint Venture Agreement with Canadian iron ore explorer New Millennium Capital (NMC) to develop the direct shipment ore (DSO) project in Canada, through its wholly-owned subsidiary in Singapore, Tata Steel Global Holding.
NMC, a publicly-owned company listed on the TSX Venture Exchange, controls the emerging Millennium Iron Range, located in the province of Newfoundland and Labrador and in the Province of Quebec, which holds the world's largest undeveloped magnetic iron ore deposits.
The Canadian miner owns 80 per cent of the mine that is estimated to have reserves of around 100 million tonnes. The DSO project includes several deposits in Quebec and Labrador near Schefferville.
Tata Steel, the world's sixth largest steel producer, is consolidating its requirement of raw materials although its own raw material requirements for its 5-million tpa domestic capacity has been secured locally, its international unit, Corus is dependent on imported ore and coal to fuel its 18 million tpa steel making capacity.
In October 2008, Tata Steel Global Holding acquired a 19.9-per cent stake in New Millennium Capital for $22.6 million (Rs106 crore) and got two board seats, along with the option to acquire 80 per cent equity in its DSO project. (See: Tata Steel buys stake in Canadian miner for $22 million)
The agreement had provided exclusivity to Tata Steel with respect to both the DSO Project and the LabMag taconite iron ore property located in NL, which is 80 per cent owned by NML and 20 per cent owned by the Naskapi Nation of Kawawachikamach.
