On May 21, Brazilian mining giant Companhia Vale do Rio Doce (Vale) announced that the company's board of directors approved the revision of its investment budget for 2009 to US$9.035 billion, compared to the US$14.235 billion budget announced on October 16,
2008.
In its statement on the issue, Vale said, "This review basically reflects change in the average price of currencies in which our expected disbursement are denominated, revised equipments and implementation costs, delays mainly associated with environmental licenses, and simplification or change in the scope of certain projects."
According to the revised capex budget, US$6.961 billion is to be invested in organic growth, of which US$5.930 billion on projects and US$1.031 billion on research and development. The maintenance of existing operations has been estimated at US$2.074 billion.
In addition, US$3.109 billion will be invested in non-ferrous minerals, representing 34.4 percent of the total capex for 2009, while ferrous minerals will receive investments of US$2.302 billion, 25.5 percent of total capex. Expenditures in infrastructure include US$630 million in power generation and US$1.858 billion in logistics, in which the bulk will be dedicated to support the company's plans to expand its iron ore production capacity. The company also plans to invest US$578 million in the coal business in 2009.