India Jindal Steel to use coal for power in Africa after CIC buy
MUMBAI, Sept 5
MUMBAI, Sept 5 (Reuters) - India's Jindal Steel & Power Ltd will spend about $100 million over two to three years to develop a coal mine in Botswana that it is acquiring through its purchase of Canada's CIC Energy Corp, a company official said on Wednesday.
Jindal agreed to buy the Canadian company in July for $115 million in cash, mainly for its holding in Mmamabula coal field in Botswana with estimated reserves of 6 billion tonnes.
"The basic premise of taking the project is the huge opportunity in power business in Africa. Our effort will be to supply power in the region," Jindal's group chief financial officer Sushil Maroo told reporters in a conference call.
"At this time, we don't plan to bring any Botswana coal to India," he added.
The company expects to start coal production from the South African mines in two to three years and is initially looking to set up a 300 megawatt power plant, which will be scaled up later.
Jindal currently operates power plants of 2,298 MW capacity in India and plans to add another 5,000 MW of coal-fired capacity there. It also operates a 3 million tonnes a year steel plant in its home country.
It also holds coal mining licences in South Africa and Mozambique and is eyeing more coal and iron ore projects in South America and Australia to boost its self sufficiency in steel raw materials.
Jindal, which last month secured approval from CIC Energy shareholders and the Botswana authorities for the acquisition, will start the process for delisting the Canadian company within a week, Maroo said.
Shares in Jindal Steel & Power closed down 4.9 percent at 335.80 rupees in a weak Mumbai market.
- Exclusive: Secret contract tied NSA and security industry pioneer |
- U.S. aircraft hit by gunfire in South Sudan as conflict worsens
- With Fed out of the way, what's next on Wall Street?
- Analysis: Lost Brazil order raises threat to Boeing fighter jets
- Four men arrested in deadly N.J. shopping mall carjacking