BHP Billiton is to form a joint venture (JV) with Japan’s JFE Steel Corporation, a recently merged entity of Kawasaki Steel Corporation and NKK.
As part of the JV deal, JFE will take a 20% interest in a sub-lease over part of BHP Billiton’s Yandi mine known as ‘Western 4’, near Newman in Western Australia, which has an ore reserve of 109 million tonnes.
BHP Billiton will retain a 68% interest, with Japanese joint venture partners ITOCHU Minerals & Energy of Australia and Mitsui Iron Ore Corporation retaining 6.4 percent and 5.6 percent interests respectively.
The joint venture intends to extract and then commercialise 160 million tonnes of Lower Channel Iron Deposit (LCID) ‘pisolite’ iron ore from the mine, ore which has not previously been used in the steel making process.
Production of up to 15 Mtpa of iron ore is expected to begin in the second half of 2005 using the existing infrastructure and facilities at the Yandi mine.