Vietnamese steelmaker Hoa Phat Group has acquired the Roper Valley iron ore mine in Australia.
The deal marks Hoa Phat’s entry into the world largest iron ore supply market and has been approved by the Australia’s Foreign Investment Review Board (FIRB).
The financial terms of the deal were undisclosed.
According to estimates, the project has 320 million tonnes (Mt) of reserves and a mining capacity of four million tonnes per annum (Mtpa).
Hoa Phat is also considering investments in other new iron mines in Australia to support a long-term supply of at least 50% of its iron ore demand, which is equivalent to 10Mtpa of steel.
The firm also looks to purchase coking coal mines in Australia in the future to become self-sufficient in its procurement of coking coal, which is a key raw material in steel production.
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Founded in 1992, Hoa Phat has a crude steel production capacity of 8Mtpa, according to the company’s filing.
Recently, BHP started production from the $3.6bn South Flank iron ore mine in central Pilbara, Australia.
It comprises an 80Mtpa crushing and screening plant, an overland conveyor system, and stockyard and train loading facilities.
The project will replace the production from the 80Mtpa Yandi mine, which is nearing the end of its mine life.
BHP owns an an 85% stake in the South Flank project while other partners include Itochu (8%) and Mitsui (7%).
The South Flank mine, together with MAC operation, will form the largest operating iron ore hub in the world.