Australian Mining Company Plans Major Plant Construction Project in Africa

It appears to be another good sign for the steel industry, particularly in Australia.

 A down-under-based mining outfit, African Energy Resources, has announced that it is going to raise 3 million Australian dollars, effective immediately, to help finance its integrated coal and power plant project at Sese, a small town located about fifty kilometers from Francistown, the second largest city in Botswana in central Africa.

The fact that the company is moving forward with this project seems to indicate that the steel and mining industry is becoming healthy again.

The long economic malaise which affected countries and national economies the world over for the past several years (although the Australian mining and steel industries held up well) may have an end in sight.

Directors and other company executives for African Energy Resources stated publicly that they have received commitments to raise the required funds through the issue of 21.43 million new, ordinary shares (also known as common stock)at an initial issue price of just $0.14 (Australian currency) per share.

The shares will be offered to Australian and Asian investors and, when purchased, will provide the necessary seed money to allow construction to continue in Botswana without interruption.

African Energy Resources, anticipating the receipt of the funds, reached a deal in October with EPC, an international engineering and construction organization with extensive experience in the kind of plant construction that African Energy Resources wants.

The plant, when completed, will enhance the company’s ability to mine iron ore and produce steel for customers in Australia and throughout Asia, including, of course, China.

While three million dollars in Australian currency may not seem to be a huge investment, it does represent a significant financial commitment for African Energy Resources and underscores the confidence this company has in the short-and-long –term future.

Clearly, if African Energy Resources is reading the current climate correctly, the economic outlook for the international mining and steel industry is indeed improving and getting healthier every day.

That, of course, means that new construction projects are increasing and the demand for fabricated steel is rising, as well.

Does it mean that construction companies in Australia will begin hiring workers again in the not-too-distant future? That possibility exists, but until it happens it will be, for Australia’s steel and mining workers, little more than wishful thinking.

Nevertheless, the announcement of the new construction project remains a positive sign for an industry that can use all the good news it gets.

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