JSPL starts iron ore mining at El Mutun in Bolivia Tuesday, 13 Oct 2009 ET reported that Jindal Steel and Power has begun mining at El Mutun iron mine in Bolivia and will export iron ore, a key input in producing steel, to neighboring countries such as Paraguay and Argentina besides China starting this month.
Mr Vikrant Gujral CEO of JSPL said that the move will have a moderate impact on the company’s overall revenues as the company will ship small quantities initially.
He said that "We will export only small quantities of iron ore for the next 4 to 5 years and that too to neighboring economies. Going forward, thrust will be on value added products such as pellets and direct reduced iron, till we start making finished steel.” But he did not quantify how much ore will be shipped.
Mr Gujral said that it will not be feasible, in the short term to ship the raw material back to India to feed its own steel plants as freight costs are too high.
JSPL secured the rights to mine El Mutun iron ore reserves in Bolivia in 2006. Although El Mutun has reserves of more than 40 billion tonne, making it one of the world’s biggest iron ore mines, the company holds mining rights for 20 billion tonne of reserves.
The company has lined up an investment of USD 2.1 billion over 8 year period for developing the mine and setting up a steel making facility. In addition the company will set up a 450 MW power plant to support the proposed steel plant.
