Vale looks at building hydro plant, coal mine

Brazilian mining and metals group Vale (NYSE: RIO) is looking at investing in construction of a hydro power plant and coal mine in Colombia, Vale CEO Roger Agnelli told Brazilian magazine Época.

The executive met with Colombia's President Álvaro Uribe to discuss the benefits of investing in the country, such as security and fiscal incentives, Agnelli said in an interview.

"I am looking at the option of building a hydro plant and a coal mine in Colombia," he said.

However, reports did not specify in which area of Colombia the investment would be made or how much it would be.

In September Colombia's transport minister Andrés Uriel Gallego said Vale was looking at investing US$6bn in Antioquia department to build an aluminum smelter plus infrastructure including a port terminal and a hydroelectric plant.

OTHER ENERGY INITIATIVES

Vale also plans to create a company dedicated to the energy sector, Agnelli told the magazine.

"Energy is strategic for us. Vale is Brazil's biggest energy consumer," he was quoted as saying.

The company aims to invest in new fuels such as biodiesel and recently acquired gas exploration blocks in an auction. It is also is keeping an eye on hydroelectric projects on the Madeira river in the Amazon, the CEO added.

Vale recently announced a plan to create a technological development center targeting clean energy initiatives along with federal development bank BNDES in São Paulo state's São José de Campos city.

"Beyond the São José project, in 2008 we want to create a technology center for the mining area and another dedicated to production processes, which would be built in Minas Gerais and Pará states," Agnelli said.

Rio de Janeiro-based Vale do Río Doce, which recently took the short name of Vale, is the world's largest iron ore producer and its assets include nickel, copper, aluminum, electric power and logistics.

Publication: Business News Americas - English News
Provider: Business News Americas
Date: December 6, 2007