Techint plan comes days after buying Usiminas stake

RIO DE JANEIRO, Dec 3 (Reuters) - Techint, the Italo-Argentine steel and engineering group, plans to build a steel-rolling mill in Brazil with partner Usiminas, boosting capacity in Latin America's largest economy, the Globo newspaper reported on Saturday.

The rolling mill will be able to process steel from a planned Techint steel project at the Port of Acu near Rio de Janeiro and add to existing production from other group assets in Brazil, Globo said.

The Techint mill at Acu or a Chinese mill planned for the same port will be able to make steel slabs that are the main raw material for a rolling mill, according to Eike Batista, the controlling shareholder of LLX Logistica which owns the Port of Acu and is leasing a mill-site to Techint.

The Techint-Usiminas rolling mill and Techint project at the Port of Acu are expected to cost about $7 billion, the newspaper reported. The rolling mill is likely to be built in Brazil's state of Rio de Janeiro or in the central-highland state of Minas Gerais, the paper added.

The rolling-mill plan is part of Techint's effort to profit from a Brazilian offshore oil boom, the paper said.

Brazil expects to more than triple oil and natural gas output by 2020 to about 7 million barrels a day, allowing the South American country challenge the United States for the role of world's No. 3 oil producer after Russia and Saudi Arabia.

Techint controls TenarisConfab, a Brazilian steel-pipe maker, and bought a 27.7 percent stake in Usiminas, the second-largest Brazilian steelmaker for $2.7 billion on Nov. 28. Usiminas' main shareholder is a Japanese group led by Nippon Steel.

Techint bought the stake in Usiminas through its Ternium and Tenaris units. Tenaris is the world's largest producer of seamless steel pipe, a high-value steel product used in the oil and natural-gas industries.

Ternium is an Argentine steelmaker, that already has a joint venture with Nippon Steel in Mexico.