Pelletising plant takes shape

21 March 2003
A Japanese-led consortium has been given the go-ahead to start supplying equipment and related services to Chador Malu Mining & Industrial Company of Iranfor a new iron ore pelletising plant in Yazd province. The contract became effective on 14 March and follows a framework agreement reached during President Khatami's visit to Japan in November 2000 for Japan Bank for International Co-operation (JBIC) to finance four major steel projects - including the Japanese portion of the pelletising plant - in Iran (MEED 28:12:01).

The plant, which will be located in the city of Ardakan, will have capacity of 3.4 million tonnes a year (t/y) of iron ore pellets. Consortium leader Kobe Steelwill provide the main machinery and equipment and carry out plant engineering, project management, training and technical assistance. Kobe will source machinery and equipment from Japanese consortium members Marubeni Corporationand Mitsubishi Corporation.

Europe's ABBwill supply automation and electrification solutions, while Spain's Taimwill supply the material handling equipment. Chador Malu is the main contractor on the project. The client is National Iranian Steel Company (Nisco).

Eighty-five per cent of the estimated $70-80 million import portion of the project is financed through export credits and secured by export credit agencies (ECAs). JBIC and state-owned Bank Sepahin December 2001 signed a Y 5,716 million ($48 million) loan agreement covering the Japanese share in the pelletising plant. The remainder is being supplied from two European banks and secured by Swiss and Spanish ECAs. Total project costs are estimated at $300 million-400 million.

The iron ore pellets produced in Ardakan will be used as feedstock at the Mobarakeh steel complex, which is being upgraded and renovated by the Italian arm of Germany's SMS Demagand Italy's Techintwith the local Irasco(MEED 22:6:01).

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