Oct. 23, 2013
Sumitomo Corporation Capitalized Sakura Ferroalloys and Sakura Ferroalloys concluded Power Purchase Agreement for Manganese Alloy Production Project in Malaysia
Sumitomo Corporation (Head Office: Chuo-ku, Tokyo; President and CEO: Kuniharu Nakamura), Assmang Ltd. (Head Office: South Africa; Chairman: Desmond Sacco, “Assmang”), and China Steel Corporation (Head Office: Taiwan; Chairman: Jo-Chi Tsou; “China Steel”) capitalized Sakura Ferroalloys Sdn. Bhd. (Head Office: Malaysia) for the purpose of production and marketing of manganese alloy in Sarawak, Malaysia (“the project”).
Assmang, which already produces and sells manganese ore and manganese alloys in South Africa, will supply manganese ore for the project; China Steel will purchase approx. 30,000 tons/year of manganese alloys produced; and Sumitomo Corporation will coordinate the project and sell manganese alloy in specific markets. The construction work is scheduled to begin early 2014 and will be completed in 2016 when production of manganese alloy starts. Also, Sakura Ferroalloys concluded Power Purchase Agreement (“PPA”) with Syarikat SESCO Bhd., an electric power supplier in Sarawak, with 80MW of contract electric power supply. This PPA enables the project to secure procurement of stable and competitive electric power on long-term basis for production of manganese alloy.
Manganese alloys are mainly used for steel production to improve the strength, toughness, and wear resistance of steel. Demand for manganese steel alloy is expected to grow in the medium- to long-term as Asian economies continue growing in the future. Through the project, Sumitomo Corporation,Assmang, and China Steel will commit a stable supply of manganese alloy in the future and contribute to the direct and indirect job creation and economic development in Sarawak state.