Brazil's Rio State Vetos Three Iron-Ore Terminal Projects
January 29 2009 - 2:49PM
Dow Jones News
The Rio de Janeiro State government has vetoed the installation
of three iron ore export terminals worth BRL5 billion (US$2.19
billion) on the state's southern coast, State Secretary for
Development Julio Bueno told Dow Jones Newswires Thursday.
The projects are: BHP Billiton's (BHP) terminal with 50 million
metric ton annual capacity; Ferrous, owned by U.S., British and
Australian investment funds, also with 50 million ton/year
capacity; and Brazore, a joint-venture of ArcelorMittal (MT) and
Canada's Adriana Resources (ADI.V), with 45 million tons/year
capacity.
Bueno said the projects had been rejected for social,
environmental and economic reasons.
"The projects won't give Rio a cent in state taxes," he
said.
The projects affected are all in the Mangaratiba area near
Itaguai, some 80 kilometers south of Rio de Janeiro City.
The same stretch of coastline contains a number of sailing
resorts centered on Angra dos Reis, the historic town of Paraty, as
well as a national park.
Bueno also said the region already contained too many projects
of this type since Mangaratiba and Itaguai already have major iron
ore export terminals.
"Our role is to defend society, and make sure there is
compatibility between economic and social interests. We won't
accept terminals at any price," he added.
"Iron ore exporters want to build terminals with capacity
totaling 250 million tons, that more or less doubles Brazil's
current exports," he said.
Bueno was referring to all seven iron ore terminal and steel
mill complexes planned for the region.
The other four projects planned involve Gerdau SA (GGB), LLX
Logistica (LLXL3.BR), Companhia Siderurgica Nacional (SID) and
Usiminas Siderurgica de Minas Gerais (USNZY).
However, it isn't all bad news for the would-be iron ore
terminal builders. Bueno said Rio de Janeiro State would guarantee
access to other ports in the state for their iron ore.
Bueno also said the backers of the three vetoed terminals would
be able to bid to use 50 million tons/year capacity to be built by
the Rio state dock company, CDRJ.
A tender will be published for the concession by July, Bueno
said.
-By John Kolodziejski, Dow Jones Newswires; 5521-2586-6086;
john.kolodziejski@dowjones.com
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