Jindal Steel starts arbitration proceedings against Bolivia over mining project
24 Dec 2011
Jindal Steel and Power has filed a claim against the Bolivian government in the International Court of Arbitration over a financial dispute over its $2.1-billion mining project, the company said today.
In 2007 the Bolvian government had granted the company a 40-year contract to mine the southeastern Mutun site near the Brazilian border.
One of the richest iron ore deposits in the world, with estimated total reserves of 40 billion tonnes, the mining project was one of the country's biggest mining projects.
The project was due to be fully operational in 2014, but, instead, the Jindals and the government of Bolivian President Juan Evo Morales are at loggerheads over investments.
Jindal Steel did not comply with its obligations to pay $600 million over two years. The company paid just 2 per cent of the amount, prompting Bolivia to seize $18 million in guarantees.