Tata Steel today said the Quebec government will invest Canadian $175 million (about USD 133 million) in its joint venture firm's direct shipping iron ore project (DSO project).
Tata Steel Minerals Canada (TSMC) is a JV established in October 2010 by the Indian firm and New Millennium Iron Corp with the former owning 94 per cent.
Quebec's Deputy Premier Lise Theriault announced award of a government financial contribution of Canadian $175 million to TSMC to support achievement at Schefferville of a DSO project, Tata Steel said in a statement.
Tata Steel Group has invested in excess of Canadian $1 billion, it added.
Quebec's Minister of Energy and Natural Resources and Minister responsible for Plan Nord and the North Shore Region, Pierre Arcand was also present at the occasion.
"The financial contribution includes equity stake of 125 million Canadian dollars through Capital Mining Hydrocarbons Fund and a loan of 50 million Canadian dollars from Investissement Quebec, acting as an agent of the government," it said.
TSMC is developing the DSO deposits located in Quebec and Newfoundland and Labrador and forecasts an annual production of over 6 million tonnes (MT) of iron ore.
Tata Steel Group ED (Finance & Corporate) Koushik Chatterjee said: "This is a challenging time in the global iron ore industry due to soft underlying steel demand, over capacity in the steel industry and volatile foreign exchange fluctuations."
Tata Steel will continue to work closely with Quebec government and other stakeholders to do all that it can do to improve the competitiveness of the Canadian iron ore business and make it more sustainable for the future, he added.
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