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Number 41/05

BHP Billiton today announced approval of the Samarco Third Pellet Plant project in Brazil.  The project will increase annual iron ore pellet production capacity by 7.6 million tonnes to 21.6 million tonnes per annum (100% basis), at a cost of US$590 million (BHP Billiton share).  First pellet production is expected in the first half of calendar year 2008.

BHP Billiton’s President Iron Ore, Graeme Hunt, said:  “This expansion is consistent with our strategy of maintaining our position in growing iron ore markets.  Samarco is a low cost supplier of seaborne pellets with a strong customer base.  Investment in a third pellet plant will consolidate its strong market position and will enhance BHP Billiton’s exposure to the important iron ore pellet market.”

Construction on the Third Pellet Plant project will commence immediately and will include:

  • Additional mining capacity and a new concentrator at the Germano mine site;
  • A second slurry pipeline of approximately 400 kms in length from Germano to Ponta Ubu; and
  • A third pellet plant, additional stockyard capacity and enhanced ship loading capacity at the Ponta Ubu site. 

BHP Billiton has a 50% interest in Samarco, with the remaining 50% being held by Companhia Vale do Rio Doce (CVRD).

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