Jindal Steel signed the contract with Government of Bolivia for EI Mutun Mine

Jindal Steel & Power Ltd has announced that the Company along with its subsidiary Jindal Steel Bolivia (JSB) signed the contract for development of El Mutun iron ore mine with the Bolivian Government. The contract has been executed to July 18, 2007 at Santa Cruz, Bolivia between Mr. Vikrant Gujral, Vice Chairman and CEO of the Company & Mr. Walter Chavez, ESM (Empresa Sideurgica Del Mutun) and Mr. Hugo Miranda Rendon, President, Comibol, in the presence of Evo Morales, President of Bolivia, Mr. Alvaro Garcia Linera, Vice President of Bolivia, Finance Minister, Defense Minister and other minister of the cabinet.

The Company has committed to invest US $ 2.1 Billion over 8 years time to develop an integrated steel plant with the following facilities:

- Pellet Plant: 10 million tonnes per annum
- Sponge Iron Plant (DRI): 6 million tonnes per annum
- Steel Plant: 1.7 million tonnes per annum
- Power Plant: 450 MW

This is the largest investment by an Indian Company in Latin America and the largest foreign investment in a single project so far in Bolivia. This huge investment is expected to generate large scale employment in the country.

This is the culmination of international bidding process started by the Bolivian Government, which the Company won in May 2006.

The project would be set up at El Mutun Iron Ore Mine on the eastern side of Bolivia. El Mutun is considered to be the worlds largest Iron Ore Mine with its reserves of 40 Billion Ton and half of its 20 Billion Ton has been provided to the Company for development. Government of Bolivia has also committed to supply of natural gas required for the development of other facilities.

Jindal Steel Bolivia, S.A., a subsidiary of the Company has been created for the purpose of this project. The total investment of US $ 2.1 Billion would be invested in the debt equity ratio of 60:40

The stock was trading at Rs.3999.50, up by Rs.170.35 or 4.45%. The stock hit an intraday high of Rs.4025 and low of Rs.3771. The total traded quantity was 5918 compared to 2 week average of 4497.

Source : Equity Bulls

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