March 6, 2019 / 1:03 PM / 7 months ago

ArcelorMittal reaches railway deal, resumes output at Bosnia mine

FILE PHOTO: Steel factory ArcelorMittal's logo is seen on an old train in Zenica, Bosnia and Herzegovina, February 9, 2016. REUTERS/Dado Ruvic

SARAJEVO (Reuters) - ArcelorMittal has agreed a provisional transportation deal with a Bosnian regional railway company, the steelmaker said on Wednesday, allowing production to resume at its iron ore mines in northwestern Bosnia.

Production at the mine was halted after talks on the deal with the Zeljeznice RS railway company collapsed last week. Transportation of iron ore was also halted.

ArcelorMittal, the world’s largest steelmaker, operates a steel plant in the central Bosnian town of Zenica which processes iron ore from its Omarska mines in the town of Prijedor.

The new agreement over transportation costs and quantities of iron ore shipped will enable the production to resume, the company said in a statement without giving more details.

In January, ArcelorMittal’s application to bid for the Bosnian government’s stake in the nearby Ljubija iron ore mine was rejected over procedural issues, prompting the company to warn of risks to the future of mining in the area.

The company’s steel-making operation in Zenica, ArcelorMittal Zenica, is Bosnia’s largest steel exporter and accounts for 2.5 percent of the country’s GDP. ArcelorMittal employs about 3,000 people in Bosnia.

Reporting by Maja Zuvela. Editing by Jane Merriman

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