Email Facebook Twitter

Stock Market news at - RSS News Feeds

Bhp Billiton Share News (BLT)

Share News for Bhp Billiton (BLT)

Share Price: 1,589.50Bid: 1,589.50Ask: 1,590.50Change: -6.00 (-0.38%)Faller - Bhp Billiton
Spread: 1.00Spread as %: 0.06%Open: 1,590.50High: 1,599.50Low: 1,570.50Yesterday’s Close: 1,595.50

DEALTALK-Mitsubishi seen tapping Chinese for Australia iron ore project

Mon, 20th Feb 2012 04:53

By Sonali Paul and Narayanan Somasundaram

Reuters) - Japan's Mitsubishi Corp plans to head to Beijing soon to line up a partner -- possibly Sinosteel or Baoshan Iron & Steel -- for a $10 billion Australian iron ore and port and rail development, people close to the deal said.

Mitsubishi has bought out its 50 percent partner Murchison Metals to take full control of the Jack Hills iron ore mine and the Oakajee port and rail project for A$325 million ($347 million) in a deal that closed on Monday.

The Japanese trading house has flagged it wants to bring in new partners to help fund the A$5.9 billion cost of building the Oakajee port and railway and the $3.7 billion expansion of the Jack Hills mine in the mid-west region of Western Australia, south of the main Pilbara iron ore region.

'That's the plan. With the stake buy done, Mitsubishi will move to get a partner for the rail and mine, preferably a Chinese investor,' a source familiar with the deal said, adding that a Chinese investor was preferred as it would also be a customer.

Mitsubishi wants to get a deal done in the next 6-12 months so it can move on with the project and could sell a 30 to 50 percent stake.

'At the moment they are open minded on the stake that would be sold,' the source said.

Whoever gets involved will need deep pockets, and there are not too many companies that fit the bill.

'This is a world class project. It's going to be a challenge to finance and you're going to need people with balance sheets to support it,' said a person familiar with Oakajee's evolution.

Sinosteel is seen as the most likely partner, as it is developing iron ore mines in the same area, a new iron ore belt that Asian steel makers want to see developed to challenge Australia's dominant iron ore producers, Rio Tinto and BHP Billiton.

A spokesman for Sinosteel Midwest, Sinosteel's Australian mining operation, declined to comment.

While a resouces joint venture between a Japanese and Chinese company may seem politically difficult given regional rivalries, economic necessity is bringing companies in the two countries together.

For Japanese trading houses, China is a huge market waiting to be supplied with resources and consumer goods, and Chinese companies have the cheap funding sources essential for major mining and energy projects.

If Mitsubishi and Sinosteel teamed up on the Jack Hills and Oakajee projects, they would be following in the footsteps of Mitsui and China's Shenhua Group, who teamed up in 2010 to chase coal developments.

Other potential partners in the port and rail project could be Angang Steel Co, which is a partner in the Karara iron ore mine with Gindalbie Metals in the same region, and Baosteel, people watching the process said.

South Korea's POSCO, which owns a 14 percent stake in Murchison Metals, had been seen as a potential stakeholder in the Western Australian projects. However a spokesman in Seoul said no decision has been made.

Australia's top coal transporter, QR National, is also keeping an eye on the Oakajee project.

'We're interested in seeing (Oakajee) going ahead and we'd be interested if there's an opportunity,' QR National spokesman Mark Hairsine said. ($1 = 0.9364 Australian dollars)

(Additional reporting by Rebekah Kebede in PERTH, Yuko Inoue in TOKYO and Hyun-Joo Jin in SEOUL; Editing by Richard Pullin) Keywords: MITSUBISHI OAKAJEE/

( 3 9286 1419)(Reuters Messaging:

Copyright Thomson Reuters 2012. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.

Related Shares: Bhp Billiton Plc (BLT) 

Australia shares storm to fresh 7yr high as China rate cut spurs resources

* China rate cut propels resources* Looming Australian rate cut lifts banks* Shares at multi-year highs (Adds analysis, quotes, stocks on the move)S
[Yesterday 02:06]

BHP's Nickel West cuts 3-year nickel supply deal with Sirius

SYDNEY, March 2 (Reuters) - Australian nickel explorer Sirius Resources will supply BHP Billiton's Nickel West division in Australia with much-need
[Sun 23:00]

RPT-UPDATE 1-Rio Tinto energy chief's job cut may signal coal exit

(Repeats story published late Friday; no changes to text)* Mining firms aim for simplification rather than growth* Rio's coal division worth at least
[Sun 21:01]

UPDATE 1-Rio Tinto energy chief's job cut may signal coal exit

* Mining firms aim for simplification rather than growth* Rio's coal division worth at least $3.6 billion-Jefferies* Glencore, Mick Davis among the po
[Fri 13:39]

Asia Dry Bulk-Capesize rates could improve but tonnage glut weighs on market

* Capesize rates close to 6-year low despite flurry of fixtures* Over 50 capesize ships waiting for cargo around China-Singapore* Panamax rates gain m
[Thu 07:17]

Ausdrill sees silver lining in Australian gold as iron ore drops

By James ReganSYDNEY, Feb 26 (Reuters) - Mine services group Ausdrill Ltd on Thursday said it was counting on a resurgence in Australian gold mining
[Thu 01:06]

RPT-Drought in Chile curbs copper production, to trim global surplus

(Repeats story published late Wednesday; no changes to text)* Anglo's Los Bronces mine could lose 30,000 T due to drought* Output down 2 pct at bigges
[Wed 21:03]

Drought in Chile curbs copper production, to trim global surplus

* Anglo's Los Bronces mine could lose 30,000 T due to drought* Output down 2 pct at biggest copper mine Escondida* Driest conditions on record in Jan
[Wed 16:00]

Sign up for Live Prices
Home  |  Contact Us  |  About Us  |  Careers  |  Advertise with Us  |  Sitemap  |  Terms & Conditions  |  Cookies  |  Privacy

Datafeed and UK data supplied by NBTrader and Digital Look. While London South East do their best to maintain the high quality of the information displayed on this site,
we cannot be held responsible for any loss due to incorrect information found here. All information is provided free of charge, 'as-is', and you use it at your own risk.
The contents of all 'Chat' messages should not be construed as advice and represent the opinions of the authors, not those of London South East Limited, or its affiliates.
London South East does not authorise or approve this content, and reserves the right to remove items at its discretion.