Jindal Steel's pact with Bolivia becomes effective

MUMBAI: Jindal Steel on Thursday said its agreement with the Bolivian Government for developing an iron ore mine and setting up a steel plant has become effective.
   
The company had entered into an agreement with Bolivia in July 2007 for development of EI-Mutun Iron Ore Mine and setting up a 1.7-million TPA steel plant there.
   
The agreement has now become legally effective after approval by the National Congress of Bolivia and completion of legalisation formalities, Jindal Steel said in a filing to the Bombay Stock Exchange.
   
Effective steps would now be taken for development of EIMutun Iron Ore Mine and setting up of the steel plant, the company added.
   
The contracted mine contains an estimated iron ore reserves of 20 billion tons and the proposed investment would be about 2.1 billion dollars.
   
El Mutun is one of the world's biggest iron-ore mines with proven reserves of 40 billion tons of medium-grade quality ore. Jindal Steel, which won the bid in June last year, would be allowed to exploit 50 per cent of the reserve.

The project would allow Bolivia to develop its steel industry and the proposed investment was the single largest in Bolivian history.

Jindal Steel is a part of the Rs 20,000-crore Jindal group and has a turnover of Rs 3,000 crore. It has business interests in steel production, mining, power generation and coal and diamond exploration.
   
Shares of the company were trading at Rs 16,230, up 2.15 per cent, in morning trade on the BSE.