MercoPress. South Atlantic News Agency

Bolivia signs largest ever mining project with Indian company

Bolivia signed a 2.1 billion US dollars mining deal with Indian company Jindal Power & Steel Ltd. after more than a year of negotiations for the exploitation of vast iron deposits near the Brazilian border.

The deal, which includes an iron mine and a steel plant, is the largest foreign investment in a single project in Bolivia, President Evo Morales said Wednesday night at a signing ceremony in the eastern city of Santa Cruz. The government is expected to earn some 200 million US dollars annually from the project. "Just imagine, that from this Mother Earth more natural resources continue to appear after so many years of looting, after 500 years of looting" Morales said. "Together we are obligated to take advantage of these natural resources for the good of the region and the nation." Jindal is required to invest 2.1 billion US dollars in the project during the first eight years of the 40-year deal, while creating 4,000 jobs, Morales said. "We have become partners of the government and partners of the people" added Jindal Vice President Vikranta Gujral. Under the deal, Jindal can mine up to 50% of the Mutun deposit's estimated 40 billion metric tons of iron ore. The deposit will remain property of the state. Bolivia awarded Jindal development rights to Mutun in June 2006, but the deal was delayed by negotiations over the price Jindal would pay for Bolivian natural gas to fuel the steel plant, among other issues. In the final contract, Jindal agreed to pay 2.50 per million British Thermal Units of gas, or about half the price at which Bolivia sells gas to neighbors Brazil and Argentina. Bolivia's Mines minister Luis Alberto Echazú said it was "the largest mining contract in the history of the country" which ratifies the Morales administration policy of having partners "and not bosses", in the exploitation of natural resources.