Results 1 to 1 of 1
01-05-2010, 01:46 AM #1
Bolivia Asks India’s Jindal Steel And Power Limited 2 Honour Its Pledge Of Investment
Bolivia has asked India's Jindal Steel and Power Limited to honour its pledge to invest $2.1 billion in the iron ore project in the country.
Bolivia and Jindal signed on the joint venture agreement in 2007. But, there has been tardy progress in that project.
Bolivian Vice President Alvaro Garcia Linera told reporters, "We see that there's a delay in the investments. We trust that Jindal will understand that it has to respect its commitments. We're demanding fulfillment of those commitments."
As per the agreement, Jindal has to invest $300 million annually for five years and $200 million annually over the next three years. The total investment would be $2.1 billion, which is to be done in eight years. Also, both the parties will develop the El Mutun iron ore reserve in a 50-50 partnership.
The joint venture will be implemented in the country's eastern Santa Cruz province.
According to Bolivia's mining director Freddy Beltran, the government can evaluate the firmís compliance and cancel the contract if the company fails to oblige. The $18 million performance bond could also be enforced.
However, the company's director in Bolivia, Arvind Sharma, told that the company had faced some problems related to electricity supplies, which would be sorted out soon.
According to sources, the joint venture's board of directors would meet in January to discuss the fresh investment plan and a time table to start the iron ore exports. El Mutun is a small Puerto Suarez town, bordering Brazil, and contains mainly iron and magnesium deposits of around 40 billion tonnes.
Jindal had started the project this year with two mineral processors with a 400-tonne-per-hour capacity, and is awaiting approval of its investment and development plans to export the iron ore.