China's Taigang to invest $1.3 bln in iron mine

SHANGHAI, June 2 (Reuters) - Shanxi Taigang Stainless Steel Co (000825.SZ), China's largest stainless steel mill, and its state-owned parent will invest about 8.8 billion yuan ($1.27 billion) to develop a large iron mine, Taigang said on Monday.

The mine, in northern China's Shanxi province where the company is based, will have the capacity to produce 7.5 million tonnes of high-quality iron ore concentrate a year, the company said in a statement.

Chinese steel mills are keen to develop domestic and overseas iron ore deposits in order to secure raw material supplies and ease their dependence on the world's major miners, such as Rio Tinto (RIO.AX) (RIO.L), BHP Billiton (BHP.AX) (BLT.L) and Vale RIO.N (VALE5.SA).

Taigang said it will establish a joint venture for the project with its parent, Taiyuan Iron and Steel Group, and will hold at least a 35 percent stake in the venture.

The mine will supply more than 2.6 million tonnes of iron ore concentrate to Taigang a year, it added. ($1=6.940 Yuan) (Reporting by Alfred Cang; Editing by Edmund Klamann)