Steel giant targets Senegal mine

Mr Mittal said the project would help the firm to grow its African interests

Steelmaking giant Arcelor Mittal is to invest $2.2bn (£1.13bn) in a mining project in Senegal.

The company hopes to develop an iron ore mine in the Faleme region, as well as a new port near Dakar and a rail line to link the two.

Arcelor Mittal said it hoped the mine would produce between 15 million and 25 million tonnes of iron each year.

Production is set to begin at the site - which holds estimated reserves of 750 million tonnes - in 2011.

"Once completed, the Faleme project will prove to be an important and competitive source of iron ore supplies for our European plants," said chief executive Lakshmi Mittal.

"This project is an important step in our strategy of creating West Africa as a mining hub for iron ore supplies to our steel plants around the world.

"We are confident Senegal will prove to be a strategic location to extend our existing footprint in the promising West African markets."

On Wednesday, the group posted its first set of results since the merger of Arcelor and Mittal, showing profits for 2006 dipped 3.5% to $7.97bn (£4.07bn).