Mumbai: Tata Steel has acquired through its subsidiary Tata Steel Minerals Canada (TSMC) half the interest in Labrador Iron Mines’ (LIM) Howse deposit for Canadian dollars 30 million (Rs 160 crore).
TSMC has the option to raise its stake to 70 per cent by paying Rs 130 crore. Howse has estimated iron ore reserves of 28 million tonnes (mt). TSMC will transfer its “Timmins 4” deposit, having resources of 1.7 mt, to LIM for C$3 million (Rs 16 crore), which is recoverable from sales.
Tata Steel already has a presence in Canada after it bought 27.7 per cent in New Millennium Iron Corporation. It also owns 80 per cent in NML’s DSO Project in the Labrador region. The DSO Project has 125 mt of resources spread over 25 deposits.
While the mine has produced 300,000 tonnes of ore, the construction of the processing plant is in full-swing. The TSMC facility, fully commissioned, will put out 6 mtpa of sinter fines, said a Tata Steel press release. H. M. Nerurkar, Managing Director, Tata Steel, said the arrangement is expected to enhance the raw material security and streamline the logistics of the DSO Project.
Infra Sharing
TSMC and LIM operate adjacent iron ore projects spread over the Provinces of Newfoundland, Labrador and Quebec. The Labrador Trough is a 160-km wide iron-ore bed in the Labrador-Quebec region in Canada.
The trough has delivered over two billion tonnes of ore in the last 50 years and attracted investments of $15 billion. It is estimated that the annual iron ore production of this region will increase from 35 mt to 65 mt by 2015.
TSMC and LIM have entered into multi-part co-operation agreements in areas of logistics and potential offtake arrangements.
It includes development of a rail line that will pass through LIM’s rail yard and connect TSMC’s processing plant with the main rail line.
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