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Bolivia postpones allocation of its largest iron ore mine

Bolivia postpones allocation of its largest iron ore mine

LA PAZ: The Bolivian government has once again postponed the allocation of the country’s largest iron ore mine, El Mutun, located on the border with Brazil, an official said Tuesday.
Two Chinese companies are vying for the rights to develop the mine.
The general counsel of the Santa Cruz department administration, Jose Luis Parada, who is on the board of directors of the state-owned mining company Empresa Siderurgica Mutun, or ESM, told reporters the company is still awaiting technical evaluation reports before taking the final decision.
The allocation has been postponed several times during the last few days and will be done in the first or second week of January, once the Higher University of San Andres in La Paz completes an evaluation of the technical proposals for the exploitation and industrialization of iron ore, Parada added.
Chinese firms Sinosteel Equipment and Henan Complant Mechanical are competing for the project that includes construction of a steel complex to process the output from El Mutun, as well as additional infrastructure and training Bolivian personnel.
Sinosteel initially offered to invest $450.6 million, while Henan’s initial proposal amounted to $419 million, according to the Mining Ministry.
The new delay in awarding the project to foreign companies comes after India’s Jindal Steel & Power pulled out of its contract to develop El Mutun three years ago.
Jindal abandoned the project in 2012 over a legal squabble with President Evo Morales’ government, which accused the company of contractual non-compliance.
Jindal won a $22.5 million arbitration judgment against Bolivia last year before the Paris-based International Chamber of Commerce, or ICC, which accepted the Indian company’s argument that, among other things, it never received access to lands where the project was to be developed.
The ICC ordered ESM to return a performance bond it had collected after accusing Jindal of failing to make sufficient investments in the project.
El Mutun, which is primarily located in the eastern Bolivian province of Santa Cruz but extends across the border into Brazil, contains some 40 billion tons of different minerals, mainly iron ore.