Nippon Steel Raises Overseas Investment to Increase Coal Self-sufficiency Rate

According to Bloomberg News, Japan’s largest steel company, Nippon Steel, is expected to invest in Mongolia and Russia’s coal projects in the near future to ensure its raw material supply.

At present, the import ratio of Nippon Steel from its own overseas coal mines is 25%-30%, and the coking coal self-sufficiency rate is expected to increase further. So far, Nippon Steel has invested 8 times in overseas metallurgical coal assets, including 4 in Queensland, Australia, 3 in New South Wales and once in British Columbia, Canada. Nippon Steel's acquisition of a 10% stake in Foxleigh Mine in Queensland, Australia, held by Itochu Corporation is the eighth overseas metallurgical coal asset investment of Nippon Steel, and it is also the first time it has acquired a coal mine producing Low Volatilization Blast Furnace Blown Coal (LVPCI). Nippon Steel will also join hands with Posco to acquire a 23% stake in the Revuboe coking coal project in Mozambique. The project is expected to cost US$600-600 million. The feasibility study will be completed in December 2011 and will be put into production in 2014 or 2015. Nippon Steel will receive about 1.7 million tons of coal annually from the Revuboe coal mine with an annual output of 5 million tons, and the coal self-sufficiency rate will increase from the current 25% to more than 30%.