Local firm eyes $250-M Leyte steel mill project

MANILA, Philippines – A company formerly engaged in mining in Leyte is proposing to develop a steel mill plant in the province with an investment of $250 million.

Philippine Economic Zone Authority (PEZA) director general Charito Plaza said officials of Nicua Corp. met with her last week to discuss their planned Leyte steel mill project.

“They just presented last week and wanted to partner with PEZA. We will report it to the President. As you know, one of the major programs of the President is that for us to have our own steel industry towards industrialization. Almost everything needs steel, automotive, computers and buildings,” Plaza said.

“The country for the first time will become a producer and exporter of steel alloy and steel products and join the ranks of emerging industrial nations should the project be pursued,” she added.

Plaza said the proposed steel mill project would have a target production of 6.4 million metric tons of magnetite concentrate to be processed on Leyte to produce three million tons of steel and 27,000 tons of vanadium.

She said the project is expected to benefit from the availability of nearby cheap and abundant geothermal power and low cost nearby production of iron ore.

“They will put up in Leyte because they have the abundance in iron there and majority of the raw materials needed in manufacturing steel is iron. Chromite and nickel they will get from the Caraga region in Surigao,” she said.

The project will require 40,000 hectares of land and is expected to employ 4,000 people upon completion in two to three years.

Plaza said the project proponents have already identified the 40,000 hectares of property in Leyte which they intend to buy from current owners.

She said Nicua is majority owned by Filipinos, which allows it to buy and own lands in the country. The company has a British equity investor, according to the PEZA chief.

“The project will provide a major boost in the economically depressed region in Eastern Visayas and will have a significant flow-on effect to the rest of the country,” Plaza said.

With the Duterte administration’s plan to spend close to P1 trillion on airports, seaports, major roads and bridges and farm-to-market roads in the next few years, local steel demand is expected to grow.

Plaza said the Philippines is currently importing $3 billion worth of steel annually.

“If we succeed in developing our steel industry, slowly we’ll stop importation because we produce it locally already so that $3 billion worth of importation a year will be gone,” she said.

Plaza said Nicua has also expressed interest to expand its steel mill project in other areas where chromite and nickel are abundant.