Shougang Starts $1.1 Billion Project to Process High Phosphorus Iron Ore

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Researched by Industrial Info Resources (Sugar Land, Texas)--Beijing's Shougang Steel and Iron Group began a $1.1 billion project in Yichang City in Hubei Province to process high phosphorus iron ore. The project will make Shougang one of China's first companies to make the most of high phosphorus iron ore.

The first phase of construction began September 15 in Yichang's Changyang County, 1,400 meters above sea level. The facility is designed with mining and dressing capacity of 600,000 tons of ore ever year after its completion next June. A 1.5 million-ton-per-annum Phase II construction will follow the $39.5 million Phase I construction. Shougang's goal is to process 10 million tons of ore every year and build a deep-processing pellet factory.

Technical problems in dephosphorizing the ores have been hindering mining. Areas around Yichang are believed to have a phosphorus iron ore deposit of 3.9 billion tons, which hasn’t been mined since 1955 when its deposit was cleared. The proven deposit of 2 billion tons (800 million tons in Yichang City), which is potentially worth $100 billion, will provide sufficient raw materials for China's iron and steel industry.

Shougang President Zhu Jimin said the company managed to make technical breakthroughs after more than a year of experimenting and will make the Yichang project an important source of iron ore after Shougang moves from Beijing to its neighbor city of Tangshan to avoid air pollution.

China's iron and steel industry has been developing fast in recent years. However, China imports nearly half of the ores from countries like Brazil and Australia. The soaring price of ores have put on pressure on China's iron and steel companies, forcing them to look for iron ore within China to lower the cost.

Established in 1919, Shougang has been one of China's leading iron and steel companies since 1949. It has been readjusting its product structure in recent years to operate nonpolluting businesses in Beijing and to move its iron and steel facilities to Tangshan City in Hebei Province before the 2008 Olympic Games.

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