Tata Steel Ltd.

Tata Steel has proposed to invest $279 million (about Rs 1,300 crore) in a joint venture for an iron ore project in Canada. The Tatas will own 80 per cent equity stake with the two Canadian firms — New Millennium Capital Corporation (NML) and LabMag Ltd Partnership — holding the rest.

The joint venture will develop the Direct Shipment Ore (DSO) project in Canada. The joint venture partners own the mining rights at Millennium Iron Range, located in the Province of Newfoundland and Labrador and in the Province of Quebec, which holds the world’s largest undeveloped magnetic iron ore deposits. In the same area, NML is also advancing to near term production of its DSO project.

Tata Steel already holds 19.9 per cent stake in NML, which is listed on the Canadian stock exchange. The feasibility study of the DSO project is under way, based on which Tata Steel through its subsidiary, Tata Steel Global Minerals Holdings, will make its investment decision within 180 days from delivery of the feasibility report.

The DSO project contains a resource of about 100 million tonnes of direct shipping quality ore. NML expects to produce four million tonnes of iron ore products per annum from the project. Tata Steel will have 100 per cent off-take rights of the production from the project.