China launches 30 mln-tn steel project in Guangxi
SHANGHAI, Sept 3 (Reuters) - China has launched a steel making project in southern China's Guangxi region that will build up annual production capacity of 30 million tonnes, the official Xinhua News Agency reported on Wednesday.
Guangxi Iron and Steel Group, formed by Wuhan Iron and Steel Group and Liuzhou Iron and Steel Group, will have annual capacity of 10 million tonnes after the project's first phrase is competed.
The capacity of the plant, in the southeast coastal city of Fangchenggang, is set to expand to 30 million tonnes after the third phrase of construction, although the companies have given no time frame for its completion.
China's current steel production capacity is about 550 million tonnes.
The project is part of a consolidation of the Wuhan Iron and Steel Group, parent of Wuhan Steel (600005.SS) and China's fourth-largest steelmaker, with Liuzhou Iron and Steel Group, which owns Liuzhou Iron and Steel (601003.SS).
The two will also shut 9 million tonnes of outdated capacity under the reorganisation plan.
Wuhan Iron and Steel Group has already begun preparations for infrastructure construction at the site, on the Guangxi coast.
In late 2005, Wuhan Iron and Steel Group announced that it would take over Liuzhou Iron and Steel Group and that the two would jointly build a 10 million-tonne steel mill as part of Beijing's plan to build large, state-of-the-art mills along the coast.
China also plans to develop the coast of the Gulf of Tonkin, near the border with Vietnam, and boost trade ties with Southeast Asia. (Reporting by Alfred Cang; Editing by Edmund Klamann)
