May 28 (Bloomberg) -- Vale SA, the world’s largest iron-ore producer, won approval to exploit a deposit of the steelmaking ingredient in the Brazilian state of Minas Gerais as it seeks to replace dwindling production.
Vale, based in Rio de Janeiro, received the concession to work at a mine in the municipality of Mariana, according to a statement in Brazil’s official gazette today. The permit will allow an estimated 20 million metric tons of iron-ore production a year on reserves of 64.9 million tons, it said.
Vale is seeking to expand output as aging mines and permitting delays in Brazil led to a market share loss to Australian producers in the last five years. The company’s iron-ore production in the southeastern region where Mariana is located declined 7.4 percent in the first quarter from a year earlier, Vale said April 17.
The permit will allow Vale to explore new mine sections at its Mariana iron-ore complex, the company’s press office said in an e-mailed statement today. The licensing will resolve the lower productivity registered at the mine in the first quarter, it said.
Vale dropped 1.6 percent to 29.77 reais at the close in Sao Paulo, extending its decline during 2013 to 27 percent.
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