VietNamNet Bridge - Some shareholders at Thach Khe Iron Joint Stock Company (TIC) were sluggish in handling their capital contribution obligations in the Thach Khe mining project, while some other partners wanted to jump into the project.

Deputy Minister of Industry and Trade (MoIT) Le Duong Quang talked about the project’s activities.

What will the MoIT do to iron out problems related to TIC shareholders’ financial obligations?

TIC shall be restructured with the Vinacomin holding the dominant share. This is not a simple work at all as it must conform to the Enterprise Law and the company’s operational rules. At first, we need money to spend on people’s relocation and site clearance. MoIT urged TIC’s management board to gather a meeting to reach a consensus on charter capital hiking, payment deadline, first round capital pooling and discussed all these issues at the general shareholder meeting. Disobedient shareholders will lose their rights to hold a stake in TIC.

What impacts has the sluggishness in mapping out concrete plans for Thach Khe steel project’s implementation led to late capital contributions by TIC shareholders cast on the development of the steel industry and relevant projects?

The sluggishness has had bad influences on all relevant parties.

How many projects have registered to source iron ores from Thach Khe mining site?

There is only the Thach Khe iron steel project in place. Thach Khe iron ores will be used for domestic consumption not for export. As planned, the extracted ores will feed TIC’s two million tonne capacity per year steel making plant which is now in the evaluation process, a joint venture project with India’s Tata and the Kobelco Iron Nugget Vietnam project in central Nghe An province.

In case TIC continues showing sluggishness in capital contribution and project’s implementation should we consider withdrawing the project’s license and holding a public auction on the right for mining activities at Thach Khe ore mine?

I believe the project’s pace will be given a boost following TIC’s capital restructuring. Not all mining sites will be offered for auctions. The new Mineral Law does not say that. Thach Khe is Vietnam’s biggest iron ore until present, so I believe the Vietnamese government will not decide on putting Thach Khe mine extraction right on auction.

Hoa Phat Group (HPG) lately appeared in the meetings of TIC shareholders and MoIT about the steel project. Does the group want to join the project?

HPG is a big steel maker with clear business strategies and wise development steps. Whether the group will hold a dominant stake in TIC or not must follow regulations in the Enterprise Law, the Mineral Law and relevant legal documents but not through issuing administrative decisions.

As far as I know HPG and BIDV which holds a 5 per cent stake in TIC had inked a cooperative deal. However, BIDV is currently still a TIC founding shareholder.

Source: VIR