What Cliffs wants is cheap power. I think the world competition would like Ontario prices. I think cheaper power prices need to be developed but Cliffs should not be the only benifactor. Make them build in Ontario first, FNs land second, they will still build as it is still better than what other companies in ferro chrome market have. The can build their own power plants with FNs support if smelter on FNs land.

A proposal by South African power monopoly Eskom to increase tariffs by 45% annually over the next three years after pushing rates up 31% this year is sounding alarm bells amongst mining companies and other heavy power users.

The Finnish Government has announced its support for the Fennovoima nuclear power initiative. Outokumpu has about 10% ownership in Fennovoima, which would enable the Group to get electricity at production cost according to its ownership. Fennovoima's plan is to have the nuclear reactor in operation by 2020. Final decision on the licence to build the reactor will be made by the Finnish Parliament later this year.

Outokumpu said the ferrochrome market is very attractive because of its high growth expectations and the rising demand especially in China.

Ferrochrome production is a very energy-intensive process and the long-term price of ferrochrome is driven by difficulties in electricity availability in South Africa, the main producing country with 40% of the global market.

The constrained situation is expected to continue for several years and the electricity price in South Africa is expected to double in the coming few years compared to the level in 2009.

“We regard our own ferrochrome as a unique competitive advantage. This expansion of our production capacity will make the Group self-sufficient. Additionally it will provide us with new growth opportunities. We are confident that customers will be very interested in high-quality ferrochrome that is produced energy-efficiently and with lowest emissions. We can now establish a permanent position on the ferrochrome market and build long-term customer contracts,” Chief Executive Juha Rantanen said.

The expanded capacity is estimated to be operational during the first half of 2013 with capacity ramped up in 2015. With current prices and exchange rates the expansion will bring additional annual operating profits in the order of euro 150 million at full capacity.

It is estimated that when the expanded ferrochrome capacity is in full use, the effect of a 5 USc/lb change in the contract price of ferrochrome on the Group's operating profit will double from the current euro 10 million to some euro 20 million annually.

The ferrochrome expansion will increase the Group's annual CO2 emissions by some 270 thousand tonnes because of the use of coke which cannot be substituted in the process.

However, Outokumpu's production process is very energy-efficient relying on in-house developed state-of-the-art technology and using mainly hydro- and nuclear power. This decreases global carbon dioxide emissions by some one million tonnes compared to sourcing ferrochrome from South Africa or Kazakhstan, mainly using fossil based energy.