Naveen Jindal-promoted Jindal Steel & Power Ltd's (JSPL's) proposed two-million-tonne steel plant in Bolivia will start production in 2011. The steel plant is part of the $2.1 billion (about Rs 8,400 crore) El Mutun iron ore mine project.
Naveen Jindal, executive vice-chairman said, the company has just received the exploration licence for the mines, which allows testing materials. "By the end of the year we hope to move small quantities of iron ore," he said.
Jindal was speaking on the sidelines of an interactive meeting organised by the Millennium Mams. The steel plant project includes a six-million-tonne direct reduced iron plant.
Jindal said the steel plant would initially cater to local demand and the surplus would be exported subsequently. In July 2007, JSPL along with its subsidiary, Jindal Steel Bolivia (JSB), signed a contract with the Bolivian government for developing the El Mutun iron ore mine.
The contract was the culmination of an international bidding process started by the Bolivian government, that JSPL won in May 2006.
El Mutun is the world's largest iron ore mine with reserves of 40 billion tonnes, half of which has been given to JSPL for development. JSPL has committed to invest $2.1 billion over eight years.
Jindal said this was an initial estimate and could change in the future. JSB was especially created for the project, which has a 60:40 debt-equity ratio.
