A FILIPINO and Chinese joint venture will start constructing next month a steel manufacturing plant in southern Philippines, which is expected to be fully operational within four years, according to the Philippine partner.
The $1-billion smelting plant, located in Zamboanga Sibugay province on the western side of Mindanao island, will be processing ore from a mining site in the neighboring province of Zamboanga del Sur.
“We are processing the ore to steel bars,” Leonardo A. Fernandez, chairman and chief operating officer of Mount Zynai 0304 Mining Corp. (MZMC), said in an interview during the plant’s groundbreaking ceremony last week.
“This is a very important project for the country because when you have the steel plant, you have 1,000 industries that will be created… somebody will order, you give us the steel for the use of nails, steel bars,” he said.
The Mount Zynai Integrated Steel Mill and Smelting Plant will be part of the Mount Zynai Industrial Park, a complex that will serve as the administrative and operational center of the company as well as for local and foreign locators in the steel manufacturing and downline industries.
MZMC’s Chinese partner is Shenzhou Investor Corp., which holds a 40% stake in the project.
The plant is targeted for partial operation within two to three years.
Mr. Fernandez said they aim to produce 1.5 million metric tons (MT) of steel bars and steel products every year.
“What we are discussing is 60% of the production is for the domestic market and 40% will be exported,” he said, noting that the local production will help bring down construction cost.
Without the plant, he said, “Imagine the cost of bringing the ore to the port, loading the ore to the vessel, vessel going to China (for processing) and loading the steel billets back (to Philippine destinations).”
The ore mining site covers a 15,000-hectare property owned by the Subanen Pigsalabukan Gokom de Bayog indigenous community.
Mr. Fernandez said 1,000 hectares under the indigenous group’s ancestral domain will be reserved for agro-forestry, agriculture production, and other community development projects
“This will not only benefit the Subanens, not only Diplahan, not only Zamboanga del Sur, but the entire Region 9 (Zamboanga Peninsula)… we are really part of the business. We are grateful to have such a transparent business, and we are grateful to the investor,” ancestral leader Timuay Lucenio Manda said in Visayan during the groundbreaking ceremony. — Maya M. Padillo