Mumbai: Arcelor Mittal, the world's largest steel company, will invest $ 2.2 billion to develop iron ore mining in the Faleme region of South East Senegal. The company has signed several agreements for the integrated project with the West African state.
The integrated mining project involves development of the mine, building a new port near Dakar and the development of approximately 750 km of rail infrastructure to link the mine with the port.
Senegal's Faleme region is estimated to have total reserves of approximately 750 million tonnes - comprising both haemetite and magnetite deposits - located in four locations.
"We are delighted at having signed the binding agreements with the state of Senegal and are now looking forward to moving forward with this important project. Once completed, the Faleme project will prove to be an important and competitive source of iron ore supplies for our European plants," Lakshmi N. Mittal, president and CEO of Arcelor Mittal, said.
"This project is an important step in our strategy of creating West Africa as a mining hub for iron ore supplies to our steel plants around the world. We are confident Senegal will prove to be a strategic location to extend our existing footprint in the promising West African markets," he added.
Production from the mines is expected to commence in 2011. The project will be developed in phases to achieve an annual production capacity of between 15 million 25 million tonnes per year .
Arcelor Mittal would also consider selective investments in downstream steel projects in Senegal. The company has also pledged its support to the community and the people of Senegal as part of its corporate social responsibility.
The agreements will become effective upon fulfillment of certain conditions precedent by the State of Senegal.