Global Steel eyeing North Korean ore: Reports

Steel tycoon, L N Mittal's younger sibling Pramod Mittal, head of Global Steel Holdings, is in negotiation with North Korean for a stake in Musan Iron Ore mines in the country, according to a reported in The Economic Times. The mines hold an estimated 7 billion plus tonnes of reserves, according to the report.

The report says the company's move is being seen as a strategic initiative to access the ore which is in sharp demand as steel makers expand capacity and iron ore miners move to a quarterly price regime to meet the growing demands of markets in Asia and Africa.

Mittal is chairman of Global Steel, a closely-held company of the Mohan Lal Mittal family. He had visited Pyongyang last week to discuss with senior government officials the modalities of share acquisition, the report says.

The M L Mittal family consists of steel tycoon L N Mittal and his younger siblings Pramod and Vinod Mittal who look after the Mumbai-based Ispat Industries.

Citing unidentified sources familiar with the development, the paper reported that Global Steel could be in negotiations with Pyongang for development rights to Musan for a fixed period, where Global Steel would carry out the mining to acquire an agreed portion of the reserves, the report said. It says such development rights are typically granted for a period of 20 to 50 years.

Two years ago, China's Tonghua Iron & Steel Group had been granted development rights on Musan for 50 years by North Korea, according to the report. However, the agreement has been recently terminated without any reasons having been assigned, by the North Korean government, the report says.