FMO set to resume normal delivery of ore to Orinoco Iron in Feb

Venezuelan state-owned iron ore producer Ferrominera Orinoco ( FMO) will resume normal delivery to briquette maker Orinoco Iron in February, the president of the latter, Luis Velásquez, told BNamericas. "We're coming to an agreement with FMO and I expect to resolve the matter in February to start operating two production lines," Velásquez said. Orinoco Iron is currently operating one production line at the plant, while the other is waiting for raw materials. "The production line is ready, but we are waiting for the iron ore from FMO to start operating," Velásquez said, adding that they are also waiting for resources to begin maintenance on a third production line. The Orinoco Iron plant is currently operating at 30% of its installed capacity of 2.2Mt. In 2010, it produced 470,000t. Due to lack of investments to improve its operations, FMO is supplying less than 50% of the nearly 110,000t of iron ore Orinoco Iron needs to operate at 100%. Orinoco Iron has been experiencing raw material supply problems for several months and, as a result, has not been able to get production levels back to normal. The Venezuelan government announced the nationalization of Orinoco Iron in May 2009, although negotiations between the parties regarding the payment the state will have to make are still ongoing. In February 2010, the government took over operative control of the company after steelmaker Sivensa, which controlled the company, declared itself financially unable to continue its administration. Orinoco Iron is located in Puerto Ordaz in Guayana region.