New Stage of the Igarapé Bahia Mine

7/10/2002

New Stage of the Igarapé Bahia Mine

Rio de Janeiro, July 10, 2002 - Companhia Vale do Rio Doce (CVRD) announces that the exploitation of the gold ore reserves in the Igarapé Bahia mine, in Carajás, was discontinued, after twelve years of intense mining activity. During the 12-year period Igarapé Bahia produced a total of 3,119,000 troy ounces of gold.

As of July 8, 2002, this operational unit has been integrated into the CVRD Carajás Department of Operations, which will initiate the Igarapé Bahia Phase IV project. In accordance with a pre-feasibility study under development, the ore deposit is estimated to have an annual production capacity of 36,000 tons of copper and 83,600 troy ounces of gold. It is estimated that the development of the mine will begin in mid-2003 and production will begin in 2004.

The on site beneficiation plant, which was previously used for the production of gold, will be adapted to copper processing, as well as the current on site infrastructure (energy supply, offices, etc.). A preliminary estimate for this project capex is US$ 54 million, most of which will be spent during 2003 and 2004.

The copper deposit Alemão, with an annual production capacity estimated at 150,000 tons per year of copper concentrate and 218,600 troy ounces per year of gold is located below this deposit. CVRD forecasts that the Alemão project will be commissioned in 2006.

CVRD's gold production forecast for 2002 is 305,400 troy ounces, resulting from the exploitation of the Fazenda Brasileiro (Bahia) and Itabira (Minas Gerais) mines, as compared to 514,400 troy ounces produced in 2001.

It is estimated that by 2007, the total amount of gold produced by the Company will reach 950,000 troy ounces per year. Therefore, CVRD gold production will be much higher than its average production over the last few years. The recovery of the production level will occur due to the development of the Carajás copper projects, which have gold as a byproduct. Those projects are in different stages of study or implementation , such as the case of Sossego.

 

For further information, please contact:
+55-21-3814-4540

Rogério Nogueira: rogerio.nogueira@vale.com
André Figueiredo: andre.figueiredo@vale.com
Carla Albano Miller: carla.albano@vale.com
Fernando Mascarenhas: fernando.mascarenhas@vale.com
Andrea Gutman: andrea.gutman@vale.com
Bruno Siqueira: bruno.siqueira@vale.com
Claudia Rodrigues: claudia.rodrigues@vale.com
Marcio Loures Penna: marcio.penna@vale.com
Mariano Szachtman: mariano.szachtman@vale.com

This press release may include statements that present Vale’s expectations about future events or results. All statements, when based upon expectations about the future and not on historical facts, involve various risks and uncertainties. Vale cannot guarantee that such statements will prove correct. These risks and uncertainties include factors related to the following: (a) the countries where we operate, especially Brazil and Canada; (b) the global economy; (c) the capital markets; (d) the mining and metals prices and their dependence on global industrial production, which is cyclical by nature; and (e) global competition in the markets in which Vale operates. To obtain further information on factors that may lead to results different from those forecast by Vale, please consult the reports Vale files with the U.S. Securities and Exchange Commission (SEC), the Brazilian Comissão de Valores Mobiliários (CVM), the French Autorité des Marchés Financiers (AMF), and The Stock Exchange of Hong Kong Limited, and in particular the factors discussed under “Forward-Looking Statements” and “Risk Factors” in Vale’s annual report on Form 20-F.

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New Stage of the Igarapé Bahia Mine