Source: Kazakh Invest
- Indicator Results
- Investment amount, thousand US dollars 179 220
- NPV of the Project thousand, US dollars 77 054
- IRR, % 21,9%
- IBITDA yield, % 45%
- Payback period, years 6,5
- Discounted payback period, years - - 9,5
Project description:
The project provides for the construction of a complex for the production of cast iron, according to the ROMELT technolonia. The extraction of iron ore and its crushing will be carried out at the Beskempir deposit. The processing complex using the ROMELT technology, where iron ore is transported after crushing, will be located at the SEZ “Seaport Aktau”.
Products:
Front cast iron
Production process:
- Mining is open;
- Recycling – liquid-phase recovery with energy coals
Sales market:
China, Russia
Annual production capacity:
250 thousand tons of cast iron.
Market prerequisites:
The presence of a rich resource base.
The Beskempir deposit, located in the central part of the Karatau ridge, is the largest iron ore deposit in the Mangystau region.
Positive price dynamics.
After the decline in 2014-2015, in the last two years, prices for pig iron again show a positive trend. According to the forecasts of market analysts (available in the Bloomberg database), these prices will remain relatively stable in the medium term.
Potential for the export of pig iron.
Pig iron exports are not sufficiently developed in Kazakhstan (in particular, exports to China were not carried out until 2018). Since 2018, China’s interest in importing pig iron from the Republic of Kazakhstan has increased: in 2018, China imported 93 thousand tons of pig iron, of which 39 thousand tons were delivered from the Republic of Kazakhstan. Meanwhile, the import of pig iron in the Russian Federation is also growing rapidly. Thus, in the period from 2017 to 2018, the import of pig iron in the Russian Federation increased from 96 thousand tons to 540 thousand tons (463%). This generally creates prerequisites for the development of export potential for Kazakhstani producers.
Further growth in demand for cast iron.
According to the forecasts of the International Steel Association, global demand for steel (the product of the final stage of pig iron conversion) will increase by 1.4% and 1.7% in 2019 and 2020, respectively. Thus, taking into account the specifics of the cast iron and steel market, an increase in demand for cast iron is also expected.