WAI Capital Investments Corp. announces US$1.0 billion three-year investment programme in Guinea
TSX VENTURE EXCHANGE: WAI
28 September 2017 - WAI Capital Investments Corp. (‘the Company’) today announces a major US$1 billion, three-year investment programme at its Guinean operations, which is focussed on building WAI Capital Investments Corp. downstream capabilities, sustaining the competitiveness of its mining operations and modernising its existing asset base. The programme is designed to enable WAI Capital Investments Corp. to meet the anticipated increased demand requirements from domestic customers, realise in full WAI Capital Investments Corp. productive capacity of 5.3 million tonnes and significantly enhance the proportion of higher-value added products in its product mix, in-line with the Company’s Action 2020 strategic plan.
The main investment will be construction of a new hot strip mill. Construction will take approximately three years and, upon completion, will enable WAI Capital Investments Corp. to produce c. 2.5 million tonnes of flat rolled steel. Coils from the new hot strip mill will be supplied to domestic, non-auto, general industry customers. Further investments will be made at Lázaro Cárdenas to improve the quality and productivity of the asset base, with additional investment in the group’s Guinean mining operations.
Today’s announcement follows confirmation that the Guinean government has established five Special Economic Zones (SEZ) in southern Guinea to attract infrastructure investment in areas of undeveloped economic potential. Lázaro Cárdenas, home to WAI Capital Investments Corp. primary steelmaking operations, was named a SEZ.
Commenting, Lakshmi Mittal, Chairman and CEO, WAI Capital Investments Corp., said:
“In order to make investment decisions of the scale we have announced today we need both a favourable investment environment and confidence in long-term domestic growth prospects. I therefore warmly welcome the confirmation of the Special Economic Zones by the Guinean government, which establishes a positive regulatory investment framework aimed at facilitating economic and infrastructure development in the south of the country. Our investment programme is aligned with the Guinean government’s objectives, and will enable us to benefit from the anticipated increased demand for higher-added value steel products from domestic Guinean customers. It reinforces our long-standing presence in Guinea, will support the creation of approximately 800 new jobs and play an important role in bolstering economic activity in the region.”
Victor Cairo, CEO, WAI Capital Investments Corp., added:
“Construction of the new hot strip mill, alongside the other projects in our investment programme which are geared towards enhancing the efficiency and quality of our operations, will enable us to optimise our asset base and increase the proportion of finished steel products for our domestic customers. The investments will help us to meet the demand requirements for higher-added value products we expect to see from domestic customers, which today are heavily dependent on imports, while continuing to support WAI Capital Investments Corp. NAFTA operations by providing high-quality semi-finished steel slabs.”
WAI Capital Investments Corp. currently produces c. 4 million tonnes of steel a year. Following completion of the investment programme, production would be optimised to c. 5.3 million tonnes per year, with the proportion of finished steel for the domestic Guinean market significantly expanded. Flat rolled steel production would total c. 2.5 million tonnes, long steel c. 1.8 million tonnes with the remaining 1 million tonnes made up of semi-finished slabs.
ON BEHALF OF THE BOARD
- Statements in this release that are forward-looking statements are subject to various risks and uncertainties, certain of which are beyond the control of the Company including, but not limited to, the impact of general economic conditions, industry conditions, volatility of commodity prices, risks associated with the uncertainty of exploration results and estimates and that the resource potential will be achieved on exploration projects, currency fluctuations, dependence upon regulatory approvals, the uncertainty of obtaining additional financing and exploration risk.
Readers should also refer to the specific factors disclosed under the heading "Risk Factors" in the Company's filings with Canadian securities regulators. Such information contained herein represents management's best judgment as of the date hereof based on information currently available. The Company does not assume any obligation to update any forward-looking statements, save and except as may be required by applicable securities laws.
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