Shougang Hierro Peru to invest $1 billion to expand production at Marcona

Bucking the current trend of most other mining companies, which have postponed expansion and exploration projects until mineral prices recover earlier levels, the Chinese state mining company Shougang is to invest $1 billion in its operations in Peru.

Starting this year, Shougang Hierro Peru will begin to expand the production capacity of its iron ore smelter at San Juan de Marcona, on Peru’s south coast.

The announcement was made at the end of last week by Wu Bin, president of the Chinese group, after talks with President Alan Garcia at the government palace.

The expansion, which is expected to be completed in 2010, will allow the refinery to increase production to 10 million tons per year. The bulk of the company’s mineral exports are to China.

Shougang acquired the state-owned Hierro Peru in a privatization bid in 1992 and took over management and operations in January 1993.

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