May 20, 2011 / 4:24 PM / in 7 years

UPDATE 2-ArcelorMittal to spend C$2.1 bln on Quebec mining

* To invest in Mont-Wright mine and Port-Cartier assets

* Expansion to create 8,000 jobs in construction phase

* To create over 900 permanent jobs once plan complete

By Euan Rocha

TORONTO, May 20 (Reuters) - The world’s largest steelmaker, ArcelorMittal ISPA.AS, said on Friday it will spend C$2.1 billion ($2.2 billion) to expand its iron ore mining operations in Quebec, as it moves to secure supplies of the steelmaking ingredient.

ArcelorMittal said it plans to expand its Mont-Wright iron-mining complex in northeastern Quebec and its industrial complex at Port-Cartier on the Gulf of St. Lawrence.

The Luxembourg-based group said the investment will help raise its Canadian iron ore concentrate output to 24 million tons a year by 2013 from 14 million tons now.

It said it is also considering plans to boost its Canadian production of iron ore pellets to 18.5 million tons a year from 9.2 million tons.

The expansion project is expected to create 8,000 jobs during the construction phase and more than 900 permanent jobs once completed, the company said.

“We have already announced our intention to grow our iron ore production to 100 million tonnes by 2015 and this expansion forms an important part of that,” the company’s mining head, Peter Kukielski, said in a statement.

The announcement came just days after the Quebec provincial government unveiled plans to develop its northern reaches into a powerhouse of mining and renewable energy, targeting C$80 billion ($82.5 billion) of private and public investment. [ID:nN09173762]

Quebec hopes to tap into the region’s abundant deposits of nickel, cobalt, platinum group metals, zinc, iron ore, gold, lithium, vanadium and rare-earth metals.

ArcelorMittal said its expansion plans in Quebec are still subject to environmental and other regulatory approvals.

The company’s Canadian arm is already a leading supplier of steel products and iron ore to markets in North America and overseas. ArcelorMittal owns extensive mining, steelmaking and tube manufacturing facilities in the provinces of Ontario, New Brunswick and Quebec.

Earlier this year, it obtained a giant iron ore deposit in the Canadian Arctic through a C$590 million deal to buy Canada’s Baffinland Iron Mines.

Baffinland’s Mary River deposit will help ArcelorMittal reach its long-term goal of nearly doubling the amount of iron ore it produces, while reducing its dependence on miners such as Vale SA VALE5.SA, Rio Tinto RIO.AX RIO.L and BHP Billiton BHP.AX BLT.L.

$1=$0.97 Canadian Reporting by Euan Rocha; editing by Peter Galloway

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