Vale says it is building second floating iron ore transfer station

Rio de Janeiro (Platts)--18May2012/627 pm EDT/2227 GMT

Vale is building a second floating iron ore transfer station, set to begin operations in Subic Bay, Philippines, in 2013, the company said Friday.

Speaking at a meeting with journalists, Vale's director for ferrous metals and strategy Jose Carlos Martins explained the stations are used to transfer iron ore from the company's very large ore carriers (VLOCs), known as the Valemax, which are able to carry 400,000 mt.

Vale would not comment on the cost of the transfer station.

Martins added that the company was considering building more transfer stations, saying "we could eventually have one in Korea, maybe even China and Japan."


The first transfer station, which has been in operation in Subic Bay since February, has become a vital part of Vale's distribution network in Asia since the Valemax was refused access to Chinese ports in January on account of its size.

"We still haven't got permission yet," Martins said on the issue of access to Chinese ports.

"Unfortunately we have encountered strong opposition from Chinese shipowners who don't believe allowing the ships access is in their interests," he said.

However, Martins said Vale was working hard to reach an agreement and expected a resolution to the impasse within the coming months. Vale said Wednesday it had been meeting with the China Shipowners Association.

Until then Vale will continue to use smaller ships to access the lucrative Chinese market, which is the company's largest iron ore export destination.

Vale's first VLOC began operating in late 2011 and the company hopes to finish construction of its 35-strong fleet by the end of 2013, at a cost of about $4.2 billion. The entire fleet will be able to transport 60 million metric tons of cargo per year. The Valemax currently only has permission to dock at five ports worldwide.

--Stephen Eisenhammer
--Edited by Carla Bass