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Semperit snares 5-year, $138 million conveyor belt contract

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VIENNA, Austria—Semperit A.G.'s Sempertrans business has won a major contract that will make it the primary conveyor belt supplier of German utility company RWE Power A.G.

The five-year pact, worth an estimated $138 million, goes into effect in January and covers more than half of RWE's steel cord conveyor belt requirements during that span.

It represents the largest single order in the history of the Semperit group of companies and significantly expands Sempertrans' business relationship with RWE, a company spokeswoman said. The companies have a long-term relationship that dates back to 2001, she said.

Sempertrans will manufacture the rubber-covered steel cord belts at its plant in Belchatow, Poland, the spokeswoman said. The company is spending $52 million to enlarge the belt manufacturing factory and add machinery and about 150 employees. That project began in July.

Production capacity at the site will be boosted once the expansion project is complete in 2015. The size of the facility, the size of the expansion and details about the capacity expansion weren't disclosed. The plant produces heavy duty steel cord and textile belts.

RWE operates three opencast mines with nearby lignite power plants and a refinery in Garzweiler, Hambach and Inden, Germany, all located west of Cologne, the spokeswoman said. The long-haul conveyor systems at the mines rely on steel cord belts.

RWE mines about 100 million tons of lignite annually and transports more than 15.8 billion cubic feet of evacuated material a year, according to Semperit.

The belting manufacturer said the mines use highly wear-resistant conveyor belts, which the firm supplies to RWE in an energy saving version. Belts with enhanced flame resistance are required for use in large machinery in open mining such as bucket wheel excavators and spreaders, the company said.

Its energy saving belt, using a new rubber compound, came on the market earlier this year. The firm claims the belt saves up to 25 percent of energy required during its operation compared to conventional belts.