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.
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