Establishment of A Joint Venture for Coke Manufacture and Sale in China

Nippon Steel Corporation (president: Akio Mimura) has come to an agreement with Kanematsu Corporation (president: Tadashi Kurachi) and Tianjin Tiantie Coking and Chemical Co.， Ltd.， hereinafter referred to as ”Tianjin Tiantie”， a company from which Nippon Steel procures coke in China， on the establishment of a joint corporation for the manufacture and sale of coke， etc. in Tianjin City， China.

The new plant of the joint venture will be built on the site owned by Tianjin Tiantie， adjacent to its existing coke plant. By utilizing the existing infrastructure， the amount of investment is planned to be held down to about a half of that for its existing facility. Also， the new plant’s proximity to Tianjin New Port (23km) gives a locational advantage for the export of coke. Through equity participation， Nippon Steel seeks to secure stable supplies of coke.

Main contents of the joint venture
(1) Name of the company: Tianjin Tiesong Coking Co.， Ltd.
(2) Location: Tianjin City in the People’s Republic of China (on the adjacent site to the existing coke plant of Tianjin Tiantie
(3) Form of the company: a China-foreign country limited partnership
(4) Main business: Coke manufacture and sale
(5) Production: 1 million tons a year
(6) Total amount of investment: 815 million yuan (about 10.8 billion)
(7) Registered capital: 415 million yuan (about 5.5 billion)
Equity ratio:
Tianjin Tiantie: 269.75 million RMB (about 3.56 billion， 65%)
Kanematsu: 137.5 million RMB (about 1.37 billion， 25%)
Nippon Steel: 41.5 million RMB (about 550 million， 10%)

For the balance (400 million yuan) between the total amount of investment and the registered capital， borrowings will be made.
(8) Number of employees: about 460
(9) Preferential right of taking deliveries: Nippon Steel and Kanematsu have the preferential right to take deliveries of their combined total of 300，000 tons a year.
(10) Board of directors: 5 members: Nippon Steel has the right to nominate 1 person， Kanamatsu 1 person and Tianjin Tiantie 3 persons for the board. President will be nominated by Tianjin Tiantie， and Vice President (1 person) by Kanematsu.
(11) Schedule:
Establishment of the joint venture: January 2004
Start of construction of the plant: March 2004
Completion of the plant: March 2005
Start of production: around July to August 2005.
- End -
Please direct any inquiries to the Public Relations Center at 03-3275-5021.