Pilbara steel project gets backing from North West Shelf partners

Austeel Pty. Ltd.'s planned new steel plant project in the Pilbara region of Western Australia has received backing from the majority of partners in the North West Shelf Gas Project. Five of the companies have agreed to contribute $13.5 million (Aus.) to the steel venture by subscribing to an Austeel convertible note.

Oct 11th, 2000


MELBOURNE�Austeel Pty. Ltd.'s planned new steel plant project in the Pilbara region of Western Australia has received backing from the majority of partners in the North West Shelf Gas Project.

Five of the companies�Woodside Petroleum Ltd., Chevron Australia Pty. Ltd., Shell Development (Australia) Pty. Ltd., BP, and Japan Australia LNG Pty. Ltd.�have agreed to contribute $13.5 million (Aus.) to the steel venture by subscribing to an Austeel convertible note.

The funds raised will be used to support the development of the project, which could be operational in 2003. The steel plant is expected to need 315 terajoules of gas per day for 20 years. A source for this gas would be the expanding North West Shelf project.

The convertible note subscription follows the signing of a memorandum of understanding in September between Austeel and the North West Shelf partners for gas supply to the steel project (OGJ Online, Aug. 24, 2000).

Major European steel group Corus Group (a merger of British Steel and Hoogovens of The Netherlands) is to be operator of the proposed Pilbara project, which plans to produce just under 4 million tonnes of finished steel products per year. The plant is to be built about 80 km south of Dampier township.

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