UPDATE:ArcelorMittal Confirms EUR17 Million Investment In French Steel Mill
01 Marzo 2012 - 1:37PM
Dow Jones News
Steel giant ArcelorMittal SA (MT) Thursday confirmed it will
invest EUR17 million in its steel mill located in Florange, France,
and will resume liquid steel production at the mill in the second
half of this year should the economy recover.
The company temporarily shut down both blast furnaces at
Florange during the second half of 2011 in response to weaker
European steel demand stemming from the onset of the European Union
sovereign debt crisis. The partial plant shutdown affected around
500 of the 2,667 employees, the company said.
French President Nicolas Sarkozy has been keen to demonstrate
that he is tackling unemployment and economic growth concerns. With
less than two months to go to the presidential elections, and as
Sarkozy continues to trail behind Socialist candidate Francois
Hollande in the opinion polls, the economic outlook looks
lackluster. The government forecasts only 0.5% gross domestic
product growth this year after 1.7% in 2011 and reported a slight
rise in unemployment to 9.4% in the fourth quarter from the third
quarter.
The chief executive of the world's largest steelmaker, Lakshmi
Mittal, confirmed in a statement Thursday what Sarkozy had
announced earlier this morning in a radio interview.
The Luxembourg-based steelmaker, the world's largest by
production, plans to invest EUR17 million at its Florange plant,
EUR2 million of which will be spent on maintenance to ensure that
the hot or liquid phase of steel production at the mill is ready to
be re-started in the second half of the year should the economy
recover, the company said.
It will also invest another EUR15 million on two new projects at
Florange: EUR7 million for a new gas holder at its coke plant and
EUR8 million at the finishing plant to develop new products for the
automotive industry.
"ArcelorMittal is very committed to its operational presence in
France," said Henri Blaffart, a senior member of the ArcelorMittal
Flat Carbon Europe, a division of the steelmaker. "In the current
difficult economic environment, the investments announced today
clearly demonstrate that ArcelorMittal is committed to its Florange
facility," he added.
The Florange plant is able to produce up to 1.4 million metric
tons of crude steel annually. The plant's two blast furnaces were
closed during the second half of last year but the company's other
operations at the plant are still working.
ArcelorMittal told union members last week that it has decided
to extend the temporary idling of its blast furnaces into the
second quarter due to weak steel demand.
Steel demand in Europe dropped 1.3% in 2011. Real European steel
consumption is forecast to fall 2% in 2012, marking a 16% decrease
compared with the first quarter 2008.
-By Alex MacDonald and Inti Landauro, Dow Jones Newswires; +44
207 842 9328; alex.macdonald@dowjones.com (William Horobin in Paris
contributed to this story.)
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